De Beers Shareholders Agree to Cut Debt

De BeersThe shareholders of De Beers-Anglo American PLC, the Oppenheimer family and the Government of Botswana-have agreed in principle, and subject to satisfactory refinancing terms of the company’s existing debt, to a rights issue of up to $1 billion to cut its $4.0 billion of debt.

"By reducing De Beers’ level of external debt and improving its capital structure, this investment would better enable the company to take advantage of new opportunities and demonstrate the shareholders’ confidence in De Beers’ continued market leadership as the recession gives way to recovery," said De Beers spokeswoman Lyentte Gould. "The investment is up to $1 billion and, should they go ahead, would be split between the shareholders in proportion to their shareholdings."

Also according to De Beers, if all three shareholders take up their full quota-proportionate to their shareholding-the ownership structure of the company will not change.  Anglo American owns 45 percent of the company, while the Oppenheimer family and Botswana owns 40 and 15 percent respectively.