De Beers Group is a British multinational diamond company that specialises in the mining, trading and marketing of diamonds.[2] The company is active in open-pit, underground, large-scale alluvial and coastal mining. It operates in 35 countries, with mining taking place in Botswana, Namibia, South Africa, and Canada. It also has an artisanal mining business, Gemfair, which operates in Sierra Leone.
From its inception in 1888 until the start of the 21st century, De Beers controlled 80% to 85% of rough diamond distribution and was considered a monopoly.[3] By 2000, the company's control of the world diamond supply decreased to 63%.[4]
The company was founded in 1888 by British businessman Cecil Rhodes, who was financed by the South African diamond magnate Alfred Beit and the London-based N M Rothschild & Sons bank.[5][6] In 1926, Ernest Oppenheimer, a German immigrant to Britain and later South Africa who had earlier founded mining company Anglo American with American financier J. P. Morgan,[7] was elected to the board of De Beers.[8] He built and consolidated the company's global monopoly over the diamond industry until he died in 1957. During this time, he was involved in several controversies, including price fixing and trust behaviour, and was accused of not releasing industrial diamonds for the US war effort during World War II.[9][10]
In 2011, Anglo American took control of De Beers after buying the Oppenheimers' family stake of 40% for US$5.1 billion (£3.2 billion) and increasing its stake to 85%, ending the 80-year Oppenheimer control of the company.[11] The company is currently owned 85% by Anglo American and 15% by the Government of Botswana.
In May 2024, Anglo American announced its intention to spin off or sell De Beers.[12]
History
Foundation
The name 'De Beers' was derived from two Afrikaner settlers: brothers Diederik Arnoldus de Beer (1825–1878) and Johannes Nicolaas de Beer (1830–1883), who owned a farm named Vooruitzicht (Dutch for "prospect" or "outlook") near Zandfontein in the Boshof District of the Orange Free State. Diederik and Johannes were direct descendants of the VOC soldier and later farmer, Matthys Andries de Beer, of Vaasa, Finland, who had migrated to South Africa in 1699 via Lübeck. Following the discovery of diamonds on Diederik and Johannes's land, the increasing demands of the British government forced them to sell their farm on 31 July 1871 to merchant Alfred Johnson Ebden (1820–1908) for £6,600. Vooruitzicht would become the site of the Big Hole and the De Beers mine, two successful diamond mines. Their name, which was given to one of the mines, subsequently became associated with the company.[13]
Cecil Rhodes, the founder of the British South Africa Company, got his start by renting water pumps to miners during the diamond rush that started in 1869,
Operations
Mining in Botswana takes place through the mining company Debswana,[69] a 50–50 joint venture with the Government of the Republic of Botswana. It operates four mines – Jwaneng, Orapa, Letlhakane and Damtshaa, though Damtshaa was put on care and maintenance in 2015.[70]
In Namibia, mining is carried out through Namdeb Holdings,[71] a 50–50 joint venture with the Government of the Republic of Namibia. Namdeb Holdings is made up of Debmarine Namibia (covering offshore mining) and Namdeb Diamond Corporation (land-based coastal mining). For offshore mining, motor vessels are used, including the 12,000-tonne, 113-metre-long SS Nujoma, built at a cost of $157 million and named after Sam Nujoma, Namibia's founding president. This vessel, the world's most advanced diamond exploration and sampling vessel, began full operations in June 2017.[72] The Benguela Gem began operation in 2022. At 177 meters it's the world's largest diamond vessel and cost De Beers $486 million to build.
Corporate affairs
In August 2017, De Beers partnered with the Stanford Graduate School of Business to accelerate business ventures to market in Botswana, Namibia, and South Africa.[114] As part of two programs, the partnership is set to help teach early entrepreneurs how to commercialize their business ideas.[115] The partnership is a three-year, $3 million deal.[116]
In September 2017, De Beers partnered with UN Women to help the advancement of women within the company and the countries it operates in.[117] In 2018, the two entities launched a program to support 500 women micro-entrepreneurs in Blouberg and Musina communities, near De Beers's Venetia diamond mine.[118]
Former operations
International Institute of Diamond Valuation
The International Institute of Diamond Valuation (IIDV) was launched by De Beers Group in March 2016. Operating in partnership with diamond jewellery retailers, it provided a reselling service for all diamonds, regardless of value.[119][120][121] In April 2019, De Beers closed its IIDV division.[122]
De Beers Ventures
De Beers Ventures was established by De Beers Group in June 2017 to consider minority stake investments in start-ups and growth companies that could be of benefit to De Beers Group or the broader diamond sector.[123][124]
Legal issues
Sherman Antitrust Act
During World War II, Ernest Oppenheimer attempted to negotiate a way around the Sherman Antitrust Act by proposing that De Beers register a US branch of the Diamond Syndicate Incorporated. In this way, his company could provide the US with the industrial diamonds it desperately sought for the war effort in return for immunity from prosecution after the war; however, his proposal was rejected by the US Justice Department when it was discovered that De Beers had no intention of stockpiling any industrial diamonds in the US.[33] In 1945, the Justice Department finally filed an antitrust case against De Beers, but the case was dismissed as the company had no presence on US soil.[125]
Relocation of Indigenous San people in Botswana
As of 2024, De Beers owns and operates, solely or jointly, five diamond mines in Botswana.[126]
See also
- Canadian diamonds
- De Beers Diamond Oval
- Julian Ogilvie Thompson
- List of diamonds
- List of synthetic diamond manufacturers
- Peace in Africa (ship), diamond mining dredge
- The Case of the Disappearing Diamonds (TV documentary)
External links
References
- Anglo American: Year end financial report for the year ending 31 December 2018, February 2018, Retrieved: 15 April 2019.^
- Britannica, The Editors of Encyclopaedia. "De Beers S.A.". Encyclopedia Britannica, 23 Sep. 2022, https://www.britannica.com/topic/De-Beers-SA. Accessed 28 August 2023.^
- So-Young Chang, Amanda Heron, John Kwon, Geoff Maxwell, Lodovico Rocca, Orestes Tarajano. The Global Diamond Industry Chazen Web Journal of International Business, The Trustees of Columbia University, Fall 2002, retrieved 5 July 2016