Home > business, economy, south africa > De Beers to Borrow $500 Million as Demand Declines

De Beers to Borrow $500 Million as Demand Declines

Originally posted on Bloomberg

De Beers, the world’s largest diamond company, plans to borrow $500 million from Anglo American Plc and other shareholders to “withstand any shocks” after gem demand fell more than 50 percent.

The loan is “prudent” in the current economic environment, said Finance Director Stuart Brown on a conference call from London today.

Jewelry sales are plunging as the global slowdown forces even the wealthiest consumers to curb spending on luxury goods. New York-based Tiffany & Co., the world’s second-largest luxury- jewelry retailer, said last month holiday sales declined 21 percent. Switzerland’s Cie. Financiere Richemont SA, the maker of Van Cleef & Arpels jewelry, said in January it saw “no cause for optimism” amid the “toughest” market conditions in 20 years.

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