De Beers starts three-year global sightholder sales contracts

31st March 2015 By: Megan van Wyngaardt - Creamer Media Contributing Editor Online

JOHANNESBURG (miningweekly.com) – Diamond mining giant De Beers Group on Tuesday initiated the 2015 to 2018 global sightholder sales (GSS) contracts that required customers to provide group accounts in line with International Financial Reporting Standards (IFRS) consolidation standards.

The new contract period has been designed to increase third-party confidence in GSS customers’ corporate transparency and financial robustness. This would be realised by requiring customers to achieve unqualified audit sign-off from a GSS-approved auditor on their financial data and their businesses to maintain a maximum debt to equity ratio.

De Beers identified two types of GSS customers in the contract period, namely sightholders and accredited buyers.

“Sightholders qualify for term contract supply, which indicates the nature and value of rough diamonds De Beers anticipates being able to offer sightholders across the forthcoming 12-month selling period,” the company said in a statement.

Accredited buyers on the other hand had the opportunity to buy rough diamonds on a more ad hoc basis through ‘ex-plan’ availability, which sightholders could also buy.

The 2015 to 2016 selling period would start with 84 sightholders and two accredited buyers.

“The approach to the new GSS contracts will support customers by helping to identify them as bankable and resilient businesses. We believe that this can deliver real advantages in an increasingly competitive landscape,” De Beers Group CEO Philippe Mellier commented.