{"id":57563,"date":"2009-12-01T14:26:00","date_gmt":"2009-12-01T19:26:00","guid":{"rendered":"http:\/\/www.businessinsider.com\/weak-diamond-market-pushes-debeers-to-the-brink-2009-12"},"modified":"2009-12-01T14:26:00","modified_gmt":"2009-12-01T19:26:00","slug":"weak-diamond-market-pushes-de-beers-to-the-brink","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/57563","title":{"rendered":"Weak Diamond Market Pushes De Beers To The Brink"},"content":{"rendered":"

De Beers, ranked No 1 miner of rough diamonds, has confirmed ongoing speculation that it is actively seeking additional funding of around US$1bn from its three shareholders. If that amount is provided, by way of loans or fresh equity, the proportional contribution would be US$450m from Anglo American<\/span>, US$400m from the Oppenheimer family, and US$150m from the Botswana government.<\/p>\n

In line with most commodity prices, rough diamonds plunged into a trough around mid-2008. Most prices have recovered well by now, but it seems that diamonds remain somewhat behind the curve. At De Beers, however, a culmination of disparate factors have left what was one of the world’s most influential miners on its proverbial cash flow knees.<\/p>\n

De Beers, a private company, publishes limited financial data, but enough to show that in the past three-and-a-half years, it has generated negative free cash flow (operating cash flow less capital expenditure) aggregating at minus US$864m. Part of the explanation lies in significant capital expenditure, at US$1.2bn in 2006 and US$1.5bn in 2007, mainly dedicated to building new mines in Canada.<\/p>\n

Read the whole thing at MineWeb >><\/a><\/strong><\/h2>\n

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