LONDON/JOHANNESBURG: Cartier owner Richemont is considering joining a consortium seeking to buy control of De Beers, as the loss-making diamond miner searches for a new owner amid growing competition from cheaper lab-grown gems.

The Swiss luxury group is in talks to join the Global Diamond Consortium, led by former De Beers CEO Gareth Penny, which is bidding for Anglo American's 85% stake in the diamond miner, a person familiar with the matter said.

De Beers is valued at about $1 billion. Botswana's government owns the remaining 15% and has yet to say whether it will exercise a first right of refusal.

Richemont, which also owns luxury jeweller Van Cleef & Arpels, is a major De Beers customer. The company is worth around $113 billion and had about €9 billion ($10.09 billion) in net cash at the end of June.

Richemont did not respond to requests for comment, while Anglo American declined to comment. Bloomberg reported that negotiations were advanced, although there was no guarantee Richemont would join the consortium.

"We view Richemont's potential participation as strategically meaningful but more about optics and long-term natural diamond category positioning than a financial event," RBC analysts said in a note.

Other potential investors are also lining up. Antwerp-based diamond-manufacturing company Pluczenik told Reuters it was bidding for a stake, without disclosing its size.

U.S. jewellery retailer Signet, which owns brands including KAY Jewelers, Zales and Jared, is also in talks to join the consortium, according to a source familiar with the company. Signet declined to comment.

Anglo American put De Beers up for sale in 2024 as part of a wider restructuring amid falling diamond prices and growing demand for synthetic stones. De Beers has been loss-making since 2023 and last year reported an underlying EBIT loss of $787 million on revenue of nearly $3.5 billion.

Richemont Chairman and controlling shareholder Johann Rupert has maintained his commitment to natural diamonds in high-end jewellery.

Dan Mano, CEO of natural diamond pricing and market advisor Rapaport, said the number of parties involved suggested individual groups were reluctant to take a large risk in De Beers. RBC analysts warned there was a risk the investment could become "a money pit."

Much depends on whether demand for mined diamonds recovers.

Tobias Kormind, managing director and co-founder of jewellery brand 77 Diamonds, said that if the market is at its lowest ebb, De Beers could offer a "completely historic" opportunity.

But "if this is not cyclical but structural, the demand does not improve, they waste a lot of money initially, and there's no impact," he added.