Russian, SA Diamond Giants Joint Forces

Russia?s diamond monopoly Alrosa and the South African diamond maker De Beers have signed a memorandum of understanding on joint diamond prospecting and exploration activities in Russia and eventually around the world.

The memorandum of understanding follows the resolution of a dispute earlier this year between De Beers and the European Commission (EC) that would see De Beers stop buying and selling half of all Alrosa?s production through its own selling arms by 2009. The EC saw that agreement between the two companies as a restriction to competition.

?Both Alrosa and De Beers are fully aware of the recent decision by the European Commission regarding their trading agreement, and will operate in strict compliance with all competition legislation requirements,? said the statement.

De Beers is the world?s largest rough diamond producer, and is over 40 percent of global gem diamonds, as well as sorting and selling the majority of the world?s rough diamonds. Anglo American owns 45 percent of the company.

Alrosa produces all of Russia?s diamonds and 20 percent of world supply.