Bittersweet goodbye.

Position:End of diamond empire

Nicky Oppenheimer, dynastic head of the fabled diamond family, called the event a "bittersweet time". The sale of the family's stake in De Beers diamond company to Anglo American had left him more sad than excited.


"The discussions around accepting this $5.1bn offer have been very difficult for Jonathan (Nicky's son) and me; after all, the Oppenheimers have been involved in the diamond industry for more than 110 years," says the family elder. "However, when presented with the offer from Anglo, we had to think in the wider context of what was in the best interest of the family as a whole. After much debate we came to the unanimous decision that the right way forward for the family was to accept Anglo American's offer."

De Beers took its name from the owners of the farmland near Kimberley where some of the most productive mines were found. The company was established in 1888 with the merger of mining pioneers Cecil Rhodes' and Barney Barnato's mining companies, the process concentrating all South Africa's diamond mining operations under one owner.

It transmuted into a family of companies that eventually dominated every facet of the diamond business and was active in every category of diamond mining: open-pit, underground, large-scale alluvial, coastal and deep sea with operations in Botswana, Namibia, South Africa and Canada. It also came to dominate industrial diamond production and marketing.

Rhodes started by renting water pumps to miners during the Kimberley diamond rush in 1871. He used the proceeds to buy up small claims and soon expanded into a separate mining company. Further growth came with funding from the Rothschild family.

Making diamonds scarce in 1889, Rhodes negotiated a strategic arrangement with the London-based Diamond Syndicate, leading to the purchase of a fixed quantity of diamonds at an agreed price.

In 1902, competition emerged with the discovery of the Cullinan Mine but this digging was soon absorbed into De Beers through negotiations led by diamond dealer Ernest Oppenheimer, a German-Jewish immigrant who had started mining giant Anglo American with financing by American JP Morgan. Oppenheimer reasoned that "the only way to increase the value of diamonds is to make them scarce, that is to reduce production".

When Rhodes died in 1902, De...

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