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De Beers operations safe amid separation, parent company says

Written by on May 15, 2024

De Beers operations in Namibia will not be affected by the planned separation from its parent company, Anglo American.

This comes after Anglo American announced the demerging from or selling of De Beers.

Anglo American spokesperson James Wyatt-Tilby says selling De Beers would not affect any of its operations in Namibia, Botswana or South Africa.

“Our intention is to separate from Anglo American the entire De Beers business, which would not affect any of De Beers’ business activities, whether in Namibia, Botswana or South Africa, nor the ownership structure of NamDeb,” he says.

Anglo American owns 85% of De Beers, with the other 15% being owned by the Botswana government.

In Namibia, De Beers has a 50/50% ownership engagement with the government in Namdeb, which is the country’s largest diamond mining company.

Duncan Wanblad

In a statement issued by Anglo American, the company says it will be restructuring and simplifying its portfolio by focusing on copper and premium iron ore, which are used in electric vehicles and for steel production.

The restructuring involves demerging or selling off De Beers and demerging its 79% ownership in Anglo American Platinum (Amplats).

De Beers chief executive Al Cook says the separation would create new opportunities for the company.

“But some things will not change. We will continue to deliver value for all our stakeholders, including our partners in Botswana, South Africa, Namibia, Canada, Angola and other countries,” he says.

Cook says the company is looking forward to finalising its agreement with Botswana, which holds a 15% ownership interest in De Beers.

De Beers last year agreed to a new diamond sales agreement, which will see the government’s share of diamonds from its Debswana joint venture gradually increase to 50% over the next decade. Cook says the company will continue to be a leader in the diamond industry.

“De Beers has led the diamond industry for more than a century. We have unparalleled expertise, outstanding assets across more than 20 countries, a unique sales model and an iconic brand, synonymous with diamonds.

“I am confident we will remain the diamond leader for the next century,” he says.

AI Cook

The company will be presenting its new strategy later this month.

“Diamonds remain some of the most desired products around the world and I am excited at the opportunity we have to bring their magic to a new generation.”

Duncan Wanblad, Anglo American’s chief executive, says a simpler business would deliver sustainable incremental value through a change in operational performance and cost reduction. According to the statement, Anglo American’s shareholders would “see the full, undiluted upside from these changes”.

“These actions represent the most radical changes to Anglo American in decades. I believe these are the right decisions to position Anglo American to capitalise on the outstanding resource endowment opportunities within our portfolio today,” Wanblad says.

The move comes three weeks after Anglo American rejected BHP Group’s proposal to combine the two companies.

The proposal comprised an all-share offer for Anglo American by BHP, with a requirement for Anglo American to complete two separate demergers of its entire shareholdings in Anglo American Platinum Limited and Kumba Iron Ore Limited to Anglo American shareholders.

“The board has considered the proposal with its advisers and concluded that it significantly undervalues Anglo American and its future prospects,” the statement reads.

It says the proposal was unattractive for Anglo American’s shareholders.

“The proposal contemplates a structure which the board believes is highly unattractive for Anglo American’s shareholders, given the uncertainty and complexity inherent in the proposal and significant execution risks,” the statement reads.

The board therefore unanimously decided to reject the proposal.

Questions sent to minister of mines and energy Tom Alweendo and diamond commissioner Miina Auene-Gahutu were not responded to by the time of going to print yesterday.

Ministry spokesperson Ten Hasheela yesterday said the ministry has not received official statements yet and therefore could not comment on the issue.

The post De Beers operations safe amid separation, parent company says appeared first on The Namibian.

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