The Botswana government has outlined an ambitious plan to acquire a majority stake in De Beers to ensure full control over its national strategic asset
BONGANI MALUNGA
The Botswana government has announced plans to pursue a controlling stake in De Beers, as uncertainty grows around Anglo American’s intentions to divest or spin off its majority share in the diamond company. An early August deadline has reportedly been set for nonbinding bids to buy Anglo’s stake with six buyers expressing firm interest.
Strategic proposal
Speaking in an interview with The Financial Times, the Minister of Minerals and Energy Bogolo Kenewendo stated that Botswana is preparing a strategic proposal to increase its 15% stake, positioning the country to secure greater ownership and influence over a company central to its economy.
Greater control
“President Duma Boko is determined to increase Botswana’s stake in De Beers to gain full control over the strategic asset and its value chain, including marketing. Diamonds have been Botswana’s blessing, but over-reliance on a single commodity presents long-term economic risks. Securing greater control over the entire value chain is a logical step toward economic diversification and sustainability,” Kenewendo declared.
A major shift
Botswana’s plan is viewed by industry players as a major shift as a potential change in ownership could significantly reshape both De Beers’ strategic direction and the global diamond landscape. The Minister emphasized that Botswana’s long-term interest lies in ensuring that its role in the diamond value chain aligns with its national development goals.
Can Botswana afford it?
A leading mining analyst at UK investment bank Peel Hunt, Kieron Hodgson, has raised doubts over Botswana’s capacity to acquire a controlling stake in De Beers, citing the country’s current fiscal limitations. In an interview with The Financial Times, Hodgson described Botswana’s plan as “far-fetched and improbable,” highlighting the sharp decline in the country’s foreign currency reserves, which fell from $4.8 billion to $3.5 billion in just one year.
Funding not a problem
Responding to questions surrounding Botswana’s ability to pull off the industry changing move, Kenewendo told the publication that funding “is not an issue” as Botswana aims to stand out as a mineral rich country that controls the value chain.