De Beers Group has entered into a definitive agreement to sell an iron ore royalty right related to the Onslow Iron project in West Pilbara, Australia.
The diamond company says this is part of its focus on streamlining the business and divesting non-core assets supporting its Origins strategy.
Taurus Funds Management will acquire the De Beers Exploration Australia subsidiary that owns the royalty for an upfront cash consideration of US$125 million and up to US$25 million deferred consideration.
The sale will close in Q4 2024, pending customary closing conditions.
De Beers Group’s ownership of the iron ore royalty right results from its historical global exploration activities.
While De Beers did not discover any economically viable diamond deposits in Australia due to its exploration programme, its exploration ground contained ore deposits.
The company says with the iron ore deposit now developed, it is taking the opportunity to sell its royalty right for value.
De Beers Group CEO Al Cook said they committed to streamlining the company’s business after Anglo American’s move to divest.
“As part of our Origins Strategy, we committed to streamlining the De Beers business.
“We have already seen significant progress in reducing our overhead costs by reshaping our workforce in support of the new strategy, and the sale of this royalty right continues the process of business streamlining as we exit this non-core asset at the right time and for value,” Cook says.
He added that with a simpler and more efficient corporate structure, De Beers will sharpen its focus on the core business of producing the world’s most beautiful natural diamonds and bringing them to market through the most value-adding channels.
