The government of Botswana is in talks to acquire a larger stake in Belgian diamond manufacturer HB Antwerp at no extra cost, its minister of minerals and energy said. 

“Due to changes in market conditions following the announcement of the investment in March 2023, the government of Botswana has prudently decided to renegotiate the terms of the proposed investment,” Lefoko Moagi told Botswana’s parliament on Tuesday (see video at 3:20:00). “A new equity percentage is currently being negotiated from the initial 24% at the time of the announcement, and in terms of the cost, it is based on the initial cost. In other words, we are not injecting more capital, but we will get more shares for the same amount proposed in 2023.” 

In March 2023, the southern African nation declared it planned to buy 24% of HB, a specialist in polishing large diamonds. The government assigned BWP 890 million ($65 million) for the deal.  

The new stake Botswana wants is 49.9%, according to Reuters, which also cited Moagi’s address to parliament. 

The government has completed legal, financial and tax due diligence for the transaction, the minister added. He also outlined four reasons for the initial acquisition: 

1. Enabling independent price discovery for Okavango Diamond Company (ODC) — Botswana’s state-owned rough-trading business — which, according to Moagi, it has “never had.”
2. Allowing ODC to sell rough through the “more commercially sustainable sales method of contracts, after selling through auctions since its founding.”
3. Giving Botswana an “ownership stake in proprietary cutting-and-polishing technology, including for small stones.” This, he said, would enable a greater proportion of rough from Debswana, the 50:50 joint venture between De Beers and the government, to remain in the country for manufacturing rather than being exported. HB’s technology would enable this, he explained.
4. Creating jobs in “higher-value” parts of the diamond supply chain in which the people of Botswana have “rarely, if ever, participated.” This includes diamond pricing and marketing, he continued.

While HB was established only in 2021, its founders have 105 years of industry experience between them, the minister said.   

HB cannot comment “on ongoing procedures,” a spokesperson for the company said Wednesday.

Image: Rough diamonds. (HB Antwerp)