De Beers To Be Sold After $3.1 Billion Loss

Mining giant Anglo American plans to sell or float De Beers, the world’s largest diamond producer, following years of weak prices and sluggish demand. The FTSE 100 company aims to streamline its operations, focusing on copper, iron ore, and fertilisers.

Chief executive Duncan Wanblad said Anglo was considering a trade sale or a public listing through an IPO or demerger. Progress on this front became possible after De Beers finalised key agreements with Botswana’s government, a crucial partner in its diamond mining operations. Although several potential buyers have shown interest, Wanblad cautioned that significant progress is unlikely before the second half of the year due to current market conditions.

Anglo’s $3.1 billion loss marks a sharp contrast to its $283 million profit from the previous year. The company, which trades on the London and Johannesburg stock exchanges, unveiled its new strategy last May while fending off a takeover bid from BHP. As part of its restructuring, Anglo has already agreed to spin off its steelmaking coal and nickel businesses and is preparing to demerge its platinum group metals (PGM) division.

The company is also developing the Woodsmith fertiliser mine in North Yorkshire, though spending on the project has been reduced. Wanblad indicated that full-scale activity at Woodsmith is unlikely to resume until at least 2027.

Despite the substantial loss, Anglo’s shares rose more than 3% in morning trading as investors responded positively to the company’s restructuring progress. Wanblad noted that the market’s improved valuation reflects the benefits of simplifying Anglo’s operations.

The company reported a 15% drop in underlying earnings before interest, taxes, and other charges, down to $8.5 billion. Lower prices for iron ore, PGMs, and steelmaking coal were the main contributors to this decline. However, stronger copper prices and effective cost-saving measures helped mitigate the impact.

Anglo’s shares climbed 3.7%, rising 87.5p to £24.57, as investors welcomed the latest steps in the company’s transformation.