If Anglo American hopes the flaws in the diamond market will buff out quickly, others seem less optimistic.
While the mining giant mulls options for De Beers, investment company Astoria made a dire pronouncement on the diamond mining interests that once represented a fair chunk of its portfolio.
Astoria is a significant shareholder in Trans Hex, a diamond mining venture that was once listed on the JSE and, for a time, was controlled by the old Rembrandt Group. When Trans Hex departed the JSE about six years ago not many gave the company much chance of survival, but it was still profitable up until a couple of years ago, thanks mainly to its Angolan operations. In fact, Astoria received a fairly sumptuous dividend of R43m in 2022.
More recently things have not gone well, with softer demand and the threat from cheaper lab-made diamonds taking their toll on profitability.
The previous gentle suggestions for equity injections became an immediate requirement
— Astoria
Last week Astoria impaired its stake in Trans Hex’s land and marine mining operations entirely. The squeeze was hard and fast. Astoria noted: “Early in 2025, budgets started showing gaps in capital repayments, but interest cover seemed in order. As prices dropped further, and production underperformed, the previous gentle suggestions for equity injections became an immediate requirement and we were faced with a decision …”
Astoria, probably prudently, opted for capital preservation over the potential future gains and declined to toss more capital in. The chilling assessment from Astoria’s directors: “As much as we would love to tell you that there is some optionality left, this is not true. The investment has come to zero and that is where it will stay.” Anglo, hopefully, has more facets to play with …
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