EU clears LVMH-De Beers jewellery venture

Print Article E-Mail Article

The EU Commission today announced that it has given antitrust clearance to the joint venture between diamond giant De Beers Centenary and LVMH Group to produce and sell De Beers branded jewellery. However, similtaneously the Commission issued a statement of objections against a related plan for the distribution of De Beers diamonds.

The Commission announced in May it was looking at a plan to shake up De Beers policies for dealing with 125 wholesalers or 'Sightholders'. Under this plan, called "supplier of choice" the company intended to boost the demand for rough or uncut diamonds, rather than restrict their supply, which had been its traditional role as buyer of last resort.

It said in a statement: "The Commission's extensive and detailed investigation of the competition effects of this deal has highlighted the extent of De Beer's dominance in the global market for the supply of rough diamonds. But it did not unearth a causal link between the combination of LVMH and De Beers at the retail level, and a possible strengthening of De Beers' position in the upstream market."

The retail joint venture known as Rapid World will now go ahead to allow the two companies to channel De Beers branded jewellery through luxury boutiques with an estimated investment of $200m each.

• De Beers Centenary is a subsidiary of diamond mining group De Beers Consolidated Mines.