Botswana’s proposed increase in its De Beers holding from 15% to approximately 25% remains unresolved as prospective investors negotiate an ownership structure for Anglo American’s planned sale of the diamond producer. US jewellery retailer Signet Jewelers (NYSE: SIG) is among companies considering participation.

Anglo American (LSE: AAL; JSE: AGL), the London-headquartered diversified mining group, currently owns 85% of De Beers, with Botswana holding the remaining 15%. Under the reported proposal, Botswana would acquire an additional 10 percentage points from Anglo’s holding, leaving approximately 75% for other investors if Anglo completes a full exit.

Botswana officials identified the Global Diamond Consortium (GDC), led by former De Beers chief executive Gareth Penny, as Anglo’s preferred bidder in July. However, Anglo chief executive Duncan Wanblad subsequently said the company was not exclusive with any consortium and that more than one remained in the process.

IntelliNews reported on October 13 that negotiations envisaged minority interests for Angola and Namibia alongside Botswana’s enlarged stake. The final allocation among African governments, consortium investors and potential industry partners has not been disclosed.

Swiss luxury group Richemont (SIX: CFR; JSE: CFR), owner of Cartier and Van Cleef & Arpels, is in talks to join GDC, as is Signet, Bloomberg reported on October 15, a report Reuters confirmed through its own source. Antwerp-based diamond manufacturer Pluczenik told Reuters it was also bidding for a stake. No final commitments have been confirmed.

Signet already works with De Beers to promote natural diamonds through a marketing partnership announced in May 2024. Its potential participation in the acquisition would be a separate investment decision, not an extension of the existing commercial agreement.

Senior Signet executives visited Botswana’s Jwaneng mine and attended a reception in Gaborone on October 23, celebrating Botswana’s 60 years of independence and its role in the natural diamond industry, the Sunday Standard reported. The visit reinforced commercial ties but did not establish that Signet would join the acquisition consortium.

Anglo has discussed indicative terms valuing its 85% stake at approximately $1bn, comprising about $750mn upfront and $250mn deferred, potentially supplemented by performance-linked payments, Bloomberg reported in July. GDC could inject another $500mn into the business. Neither the purchase price nor the capital injection has been agreed.

The roughly $1bn fixed consideration implies a value of about $1.2bn for the whole of De Beers, putting Botswana’s existing 15% stake at about $176mn, IntelliNews calculated in September. On that basis, the additional 10 percentage points would cost Botswana around $118mn, before any performance-linked payments or capital contributions. Anglo has written De Beers’ carrying value down to $2.3bn.

Analysts have questioned whether the proposed ownership structure could withstand a prolonged downturn. RBC Capital Markets warned that Richemont’s potential investment could become a “money pit” if demand for mined diamonds failed to recover, noting that De Beers lost $511mn last year. Rapaport chief executive Dan Mano told Reuters that the number of prospective investors suggested individual groups were reluctant to take on substantial risk.

The negotiations come amid continuing weakness in the natural diamond market. De Beers’ third-quarter production fell 11% year on year to 6.8mn carats, including a 20% decline in Botswana to 4.8mn carats, reflecting planned maintenance at Orapa.

Third-quarter rough diamond sales volumes increased 71% to 9.77mn carats on a total basis, while consolidated sales volumes rose 91% to 8.71mn carats. Consolidated rough diamond sales revenue increased just 4% to $731mn, as average realised prices fell 45% to $84 per carat. In January–September, consolidated revenue fell 15% to $2.04bn and the average realised price dropped 37% to $97 per carat. De Beers expects planned maintenance at Jwaneng to reduce fourth-quarter output substantially.

Botswana faces significant fiscal constraints in financing a larger holding. Moody’s Ratings downgraded the sovereign to Baa2 from Baa1 on September 25, warning that a material debt-financed increase in its De Beers investment could place further pressure on its credit rating.

Botswana, which holds a right of first refusal over Anglo’s stake, has retained Lazard and Switzerland’s Compagnie Bancaire Helvétique as advisers. Although the government previously indicated that it hoped to complete a transaction in the fourth quarter of 2026, the final ownership structure, financing arrangements and binding sale terms remain unresolved.

See IntelliNews: Botswana weighs bigger De Beers stake as due diligence on Anglo diamond sale winds up