As the world’s largest diamond producer by value, Botswana has been particularly affected by the global economic slowdown, which has led to a significant drop in diamond demand. The weakened market has also impacted HB Antwerp's valuation, creating an opportunity for Botswana to renegotiate its investment.
Mines Minister Lefoko Moagi informed parliament that the country plans to leverage the lower valuation to secure a larger stake in the company without injecting additional capital. "We will not be injecting more capital, but we will get more shares for the same amount proposed in 2023," Moagi stated. "Instead of the 24%, we will negotiate to get 49.9% for the same amount initially proposed."
In February, finance ministry budget documents revealed that Botswana had allocated 890 million pula ($65.95 million) for a 24% stake in HB Antwerp, valuing the company at approximately $275 million.
The HB Antwerp deal, announced during Botswana’s negotiations for a new sales contract with Anglo American’s diamond unit De Beers in March 2023, is part of Botswana’s broader strategy to increase its influence in the downstream diamond industry. The deal is also seen as a move to strengthen the country’s ability to market its diamonds independently of the longstanding agreement with De Beers.
Under the terms of the deal, Botswana’s state-owned Okavango Diamond Company (ODC) will supply HB Antwerp with rough diamonds for five years.
This strategic maneuver reflects Botswana's efforts to adapt to the current economic climate while bolstering its presence in the global diamond market.
