Iconic South African company went from legendary to liability

De Beers has gone from Anglo American’s crown jewel to a liability that it is struggling to sell, losing billions in the process.

In the mining giant’s latest results for the 2025 financial year, Anglo recognised a $2.3 billion (R36.71 billion) pre-tax impairment due to De Beers. This is a far cry from the diamond giant that ruled the global industry only a decade or so ago.

Notably, the company’s decline is not due to operational failures, but rather due to an external threat – the booming popularity of man-made diamonds.

Founded in the late 1880s by Cecil John Rhodes, De Beers has been the dominant player in the diamond industry for well over a century.

The company was instrumental in the creation of the Centralised Selling Organisation (CSO), which had complete control over the supply of a large portion of the world’s diamonds.

Once controlled by the Oppenheimers, De Beers controlled over 80% of the world’s rough diamond production, with peak production exceeding 30 million carats every year.

However, over the past decade, the demand for De Beers’ products has declined significantly, coinciding with the rise in man-made diamonds.

Driven largely by the cost difference between the two, with manmade diamonds significantly more affordable than their natural alternatives, the global diamond industry has shifted significantly in favour of the synthetic option.

According to Forbes, lab-grown stones accounted for just 1% of diamond sales in 2015 but rose to around 20% by 2024.

The publication said engagement ring trends have shifted even more dramatically, with over half of center stones being lab-grown in 2024, up from only 12% in 2019.

This has led natural diamond producers, including De Beers, to lose their stranglehold on the industry, which has severely impacted their finances.

Now owned by Anglo American, the impact of this shift in demand has shown clearly in De Beers’ results.

For the 2025 financial year, De Beers produced 21.66 million carats of diamonds, and sold 20.95 million carats.

This is not far off from the company’s output under the leadership of Sir Ernest Oppenheimer’s son, Harry, when De Beers would produce around 21.4 million carats of diamonds annually. 

However, at a cost of only $142 per carat, De Beers only recorded revenue of $3.49 billion (R55.79 billion), and made an underlying EBITDA loss of $511 million (R8.17 billion) in the 2025 financial year.

Anglo explained that this loss was due to challenging rough diamond trading conditions, characterised by a lower average rough price index and stock rebalancing initiatives.

This, the company explained, is despite De Beers’ mining operations having delivered solid operational performance at lower output levels.

As the business produced into prevailing demand, rough diamond production fell by 12%. This saw Anglo take a notable hit to its finances, recognising a R36.71 billion pre-tax impairment due to De Beers.

The deal to sell Anglo’s crown jewel

Recognising De Beers’ decline and amid efforts to streamline its portfolio, Anglo has been seeking a buyer for the diamond giant.

However, progress in this regard has been choppy, with very few buyers interested in acquiring the once-great De Beers.

The latest – and most – interested buyers are the governments of African countries, including Botswana, Angola and Namibia, which have formed a consortium in their bid to acquire a stake in De Beers.

In February 2026, Anglo CEO Duncan Wanblad told the Financial Times that his company is close to securing a deal with the governments and some private investors to sell its stake in De Beers. 

Wanblad said Anglo hopes to complete the sale of De Beers before the end of 2026, adding that the spin-off from the diversified miner would “almost certainly” see Botswana’s government increase its stake in De Beers from its current 15%.

The governments of Angola and Namibia have also shown an interest in acquiring stakes in De Beers, with Angolan officials telling reporters the government would like to take a 20% to 30% stake.

In the meantime, Anglo seems set to continue taking pain from its stake in De Beers, with its 2025 results not painting an optimistic picture of the company’s outlook.

In its latest results, Anglo explained that the carrying value of the De Beers business as a whole, including external cash and debt, at 31 December 2025, was $2.3 billion (R36.76 billion). 

Anglo’s production guidance for De Beers for 2026 is 21 to 26 million carats, though it noted that the company would continue to monitor rough diamond trading conditions in order to align output with prevailing demand.

The company noted that polished wholesale diamond prices showed signs of stabilisation early in the year, but sentiment weakened sharply following the introduction of US tariffs on Indian exports. 

“India remains the main cutting centre for natural diamonds, and the US remains the largest end-market for diamond jewellery,” it said.

“Demand for natural diamonds at the retail level proved resilient, although retail sales of laboratory-grown diamonds continue to have an impact.” 

Its unit cost guidance for 2026 is around $80 per carat, lower than the 2025 unit cost of $86/carat, driven by expectations of slightly higher production volumes and ongoing cost-control measures.

“As previously announced, Anglo American continues to pursue a dual track separation for De Beers, and a structured sale process is currently underway,” the company said.

However, it also noted that, while management remains committed to a divestment or demerger of the business, there remains uncertainty around the terms, legal structure and regulatory approvals for any such transaction.