Oppenheimer family to sell 40% stake in DeBeers.

[denverappraiser]

London--Anglo American announced that it is buying the Oppenheimers' 40 percent stake in De Beers for $5.1 billion dollars. Nothing short of an earthquake in the diamond industry, the deal will give Anglo an 85 percent stake in DeBeers.

http://www.nationaljeweler.com/nj/diamonds/supply/article_detail?id=27400

 

[MissGotRocks]

In the long run, what's your guess as to how this will affect consumers?

 

[Tom Gelb]

Hi Neil,

I saw this also, but was unsure as to the significance and/or ramifications. What are your thoughts?

Thanks,

Tom

 

[Lahey]

In the long run, what's your guess as to how this will affect consumers?

they certainly aren't buying them so that they can cut prices for consumers. anti-trust shouldn't allow this deal to go through.

 

[denverappraiser]

It’s not a US company. US anti-trust laws don’t apply. The government of Botswana is another big stockholder and gets a say in this but I think the company is incorporated in South Africa.

It depends on why they’re doing it. I’m guessing it’s about back office politics and not the family thinking it's time to get out of diamonds. This may be the beginning of big new things for the Oppenheimers. They walk away from this will billions in the bank and I think we’ll see that money turn up invested in other mines and/or manufacturers elsewhere under more direct control. DeBeers has some policies and procedures that aren’t likely to be very profitable and if Opp can eject them and set up his own system he may be able to do pretty well for himself. More mines are desperately needed and there aren’t all that many people out there with the finances, the skills, and the stones to get into the diamond business in a big way.