Diamond Giant, De Beers, Says Goodbye to CEO

Gareth Penny, the Chief Executive Officer of De Beers, the world’s largest diamond producer, announced that he will be stepping down from his position later this year after helping the company get “back on its feet”.  According to Penny, he feels it is “the right time to leave.  We’ve come out of a difficult period.”

Gareth Penny, 48, has been the CEO of De Beers for the past five years and has been a huge part of the company’s biggest jump in half-year sales. He led the company through a severe global recession that saw massive drops in diamond demand.  De Beers credits penny for helping the company through this rough time and bringing about its “subsequent recovery.”

De Beers reported a staggering $2.6 billion of rough diamond sales during this year’s first half which was much higher than either one of 2009’s half-year summaries.  2009’s first half saw only $1.6 billion sales while the second half saw a hardly improved $1.8 billion.  Despite this surprising 84% climb, experts say that the recession is far from over.

The company will have to clear some of their restructured $1.98 billion external debt and shareholder’s loans od $785 million.  It’s possible that De Beers will become more dependent on stable retail jewelry purchases in the Asian market as a time when diamond and diamond jewelry demand remains unpredictable in North America and Europe.

Surprisingly, De Beers has not yet found a permanent successor.  Until they do, their Chief Financial Officer Stuart Brown, and Chief Commercial Officer Bruce Cleaver will be acting as joint-CEO’s.  Many analysts believe this is a poor decisions on the part of De Beers.  “Why let him step down if you haven’t got a replacement” It’s not an ideal situation,” said Peter Davey, head of mining research at Ambrian Capital Plc.