Richemont, Signet weigh joining De Beers consortium bid

Richemont, a Swiss luxury group, and Signet Jewelers, a US retailer, are reportedly in discussions to join a consortium seeking to acquire De Beers, a leading diamond miner valued at approximately $1 billion. The potential buyers are said to be in advanced talks with Global Diamond Consortium, a group led by former De Beers CEO Gareth Penny.

While the talks show promise, there is no assurance of either company's participation. Their involvement would provide both Richemont and Signet with a stake in a critical component of the diamond supply chain. The consortium is also in discussions with Botswana regarding an increase in government ownership to about 25%, currently held at 15% by the country, which produces roughly 70% of De Beers' diamonds.

The group encompasses Namibia and Angola, two significant diamond-producing nations, as well as prominent diamond manufacturers. The financial stakes for Richemont and Signet have not been disclosed, but with several governments and private investors involved, their shares could be relatively modest. Richemont, controlled by South African billionaire Johann Rupert, owns renowned jewelry brands such as Cartier, Van Cleef & Arpels, and Vacheron Constantin, accounting for about three-quarters of its business.

Signet, one of the largest jewelry retailers, operates Zales, Jared, and Kay. This direct investment would follow other jewelry companies' recent ventures into diamond mining, including British brand Graff, which holds a 14.9% stake in Gem Diamonds, owner of Lesotho's Letseng mine. Richemont and Anglo American have not commented on the matter.

RBC analysts suggested that Richemont's potential involvement would be strategically significant, primarily reflecting positioning in the natural diamond market rather than a financial move. The final decision rests with Botswana, which holds a right of first refusal, but has not indicated whether it will exercise this option. A government spokesperson stated that they would not comment until a transaction has been finalized and signed.

Officials have previously indicated that a deal may conclude in the fourth quarter of 2026. Anglo American has been attempting to sell De Beers since it rejected a nearly $50 billion offer from BHP in early 2024. The process has been complicated by a downturn in the diamond market, with Anglo reporting three impairments on the business over the past three years, reducing its carrying value to $2.3 billion in February.

Independent diamond analyst Paul Zimnisky believes De Beers presents a long-term value investment opportunity, citing its resilient history and potential for growth with sufficient capital and proper execution.