* Substantial part of proceeds earmarked for Africa
* Oppenheimers among Africa's richest
* Family involved for over 80 years
By Marius Bosch
JOHANNESBURG, Nov 4 For over 80 years, South
Africa's Oppenheimer family held sway over the global diamond
trade, an era which came to an end of Friday with Anglo
American's buyout offer for De Beers.
The $5.1 billion the family will get for its 40 percent
stake in the diamond giant could see a large chunk ploughed back
into Africa for private equity investment or philantropic work
in the world's poorest continent.
The Oppenheimers have been involved at De Beers since 1927,
when Ernst Oppenheimer, who founded Anglo American a decade
earlier, took control of the group.
The family's fortune has been intertwined with South
Africa's history and economy ever since.
"At the end of the day this has been a very momentous
decision for the family. We didn't approach Anglo, Anglo
approached us," said James Teeger, managing director of family
holding company E. Oppenheimer & Son.
The world's largest diamond miner, De Beers was established
in 1888 in South Africa. Its corporate slogan 'A diamond is
forever' was created in 1947 and named the greatest advertising
line of 20th century by Advertising Age magazine.
De Beers Chairman Nicky Oppenheimer, educated at Harrow and
Oxford, is a passionate cricketer who has his own cricket ground
outside Johannesburg. He has been at the helm since 1998 and his
father Harry was chairman of De Beers for 27 years until 1984.
Anglo American has been trying to buy the family's stake for
years but the Oppenheimers declined to sell -- even when the
2008 global financial crisis forced shareholders to pump cash
into De Beers when diamond sales and demand for luxury goods
Since then analysts said the Oppenheimers sought to step up
the pace of diversifying their investments.
The deal happened very fast, Teeger said, adding that
diversification was one of the factors which convinced the
family to sell.
"This thing happened extremely quickly, (Anglo chairman)
John Parker approached Nicky Oppenheimer a few weeks ago,
literally three of four weeks ago."
The speed of the transaction meant the family had no
specific plans on how the capital will be deployed.
"The one thing for sure is that we are going to deploy a
substantial amount of the capital in Africa," Teeger said.
The Oppenheimer family holding company already has a private
equity arm operating in South Africa, investing in mid-sized
In August it set up a $300 million private equity fund with
Singapore state investor Temasek Holdings to invest primarily in
consumer goods and agricultural sectors across Africa.
The transaction brings to an end the era when the global
diamond trade was driven by relationships between a small group
of people, said Martin Rapaport, Chairman of the Rapaport Group,
and a well-known commentator on diamond industry developments.
"This is the final vestige of a time when a community of
people working together directed the industry," he said.
De Beers tightly controlled the diamond market for decades
before changing its strategy in 2000, buying up and stockpiling
diamonds to control gem prices.
For the Oppenheimers, worth around $7 billion according to
Forbes magazine which put them in 136th place of the world's
billionares, not much will probably change after the De Beers
They are passionate conservationists and own the Tswalu
Kalahari Reserve, the largest private game reserve in South
Their Brenthurst mansion in Johannesburg is famed for its
gardens which have been opened to the public and the family is
involved in numerous charity and upliftment projects in South
Nicky Oppenheimer told South Africa's Mining Weekly trade
publication last month that relaxing is his hobby.
And when asked what his personal best achievement was, he
replied: "Choosing my parents very well".