For decades, Diamond Trading Company sightholders have journeyed to De Beers’ stately headquarters on Charterhouse Street in London to get their goods.
No longer. In a historic announcement, De Beers said Sept. 16 that it would relocate its famed “sights” to Botswana, the largest producing country in the De Beers stable, by the end of 2013.
In addition, all other DTC functions, including sorting, valuation, and the company’s key account managers, will also be transplanted to Gaborone, the country’s capital.
Some functions will remain in London, mainly the Forevermark team and corporate services, including the accounting and legal departments.
DTC managing director Varda Shine tells JCK says the move will impact some 120 to 150 employees, and the DTC is currently talking with its people about the transition.
“Obviously there is a bit of surprise,” she says. “This is a huge shift. You can’t just take people and cut and paste them.”
She notes that the move will also involve some changes on Botswana’s part, as Gaborone currently may not have enough hotel space to accomodate all the sightholders who will now be visiting 10 times a year.
She adds that the DTC is in the process of securing space for its new headquarters. While there currently is an office for DTC Botswana, which is a joint venture between the DTC and Botswana government, this move will involve the overall DTC.
The shift is part of De Beers’ new 10-year sales contract with Botswana. The back-dated deal, which covers sorting, valuation, and sales, has as its start date Jan. 1 of this year. It is the longest contract ever between the two partners.
The agreement is a “great milestone as far as we are concerned and as far as the industry is concerned,” Shine says. “We have secured 10 years of supply with the biggest producer in the world. It’s good news for sightholders as they will have peace of mind about the continuity of supply. It’s good news for the Bostwana government as they have great aspirations to become a leading hub.”
The agreement also calls for Botswana to market a sizable portion of its production outside the DTC. In 2011, Botswana will sell 10 percent of its production independently. That will rise to 15 percent over a five-year period.
Shine says she doesn’t know how this production will be marketed, but notes other producers have similar arrangements.
De Beers’ contract with Botswana has been the subject of considerable speculation in recent months. It originally expired at the end of 2010. Then the negotiation period was extended to March 2011. Soon that deadline passed, even as De Beers frequently declared a new contract was “imminent.”
Now, six months after the extended deadline, a new contract has finally appeared.
Shine says it shouldn’t be surprising that the negotiations “took time, especially when people understand what we’ve agreed to.”
In a statement, Botswana’s minerals, energy, and water resources minister Dr. Ponatshego Kedikilwe called the agreement “only a first step.”
“Much work needs to be done during the next several years to make this transformation a success,” he said.Follow JCK on Instagram: @jckmagazine
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