Date
16 December 2017
De Beers hopes that demystifying some of its operations could help investors place a more accurate value on its parent company. Photo: Bloomberg
De Beers hopes that demystifying some of its operations could help investors place a more accurate value on its parent company. Photo: Bloomberg

De Beers reveals diamond secrets

Diamond producer De Beers has unveiled, for the first time in its 126-year history, trade secrets such as where its best diamonds come from and how much they fetch per carat. 

In a bid to capture some reflected glory from the jewel in its crown, parent firm Anglo American Plc, the London-based mining giant that bought De Beers in 2012, revealed long-hidden operating data in a 90-minute presentation to investors and analysts.

Providing more details of its diamond unit could help convince investors that buying Anglo shares is the best way to gain exposure to a commodity that’s gained about 75 percent in the past five years, outperforming any of the other major products Anglo mines, Bloomberg reported.

“Shareholders’ best interests are served by transparency, disclosure and openness,” said Jeremy Wrathall, head of global natural resources at Investec, who values the subsidiary — which provides about a fifth of the company’s revenue and a quarter of its earnings – at US$20 billion.

The presentation follows the publication of the company’s first Insight report in September, a treasure-house of information in an industry where reliable data is almost as rare as the rocks themselves.

De Beers is still keeping some secrets under wraps: the cost of mining diamonds and the profit margins at its retail business. 

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