A seemingly ordinary and simple business game may have far-reaching significance. The South African Oppenheimer family may bid farewell to the diamond industry, which has made money for three generations, after a deal regarded as "left-handed to right-handed". The Oppenheimer family monopolized the diamond dynasty for a century, which may be divided up by "various princes".
20 1 1 On the first day of the Lunar New Year, an explosive changes in equity enveloped Anglo American, one of the world's largest mining companies, and De Beers, the world's largest diamond company. The former plans to acquire a controlling stake in the latter through share acquisition. Earlier, Anglo American already owned 40% of De Beers. The planned further acquisition is another 45% of the shares owned by the Oppenheimer family.
In fact, the Oppenheimer family is also a long-term investor in Anglo American. Anglo American Resources Group itself was founded by the South African Oppenheimer family in 19 17. However, not long ago, the family just sold its Anglo-American shares on a large scale, and the shareholding ratio fell below 2% for the first time. Insiders pointed out that the long-term relationship between the Oppenheimer family and Anglo American and De Beers will be gone forever if the acquisition plan led by shareholders of other large institutions of Anglo American is implemented.
However, regardless of the outcome of the acquisition and whether the Oppenheimer family will be squeezed out of the diamond industry, after all, the Oppenheimer family once controlled 90% of the global diamond rough market. For nearly a century, the absolute influence of this diamond dynasty on the world diamond industry should not be forgotten by the world.
Diamonds make South Africa the richest man.
Oppenheimer was originally a Jewish surname. 1880, Oppenheimer, the founder of the Diamond Dynasty, was born in a German cigar manufacturer's family. /kloc-when he was 0/6 years old, he came to London with his brother and worked in the diamond sorting workshop of a Jewish diamond dealer, responsible for picking out defective diamonds. Soon, Jewish diamond dealers found that Ernest seemed to have a natural keen discrimination on the quality of diamonds, although he had no professional training. In the era when there is no jewelry identification machine, the value of this vision is self-evident.
At the age of 2 1, Ernest was sent to work in an office in Kimberly, South Africa by a Jewish diamond dealer. Kimberly is a famous "diamond city" in South Africa. More than 30 years ago, a huge diamond mine was discovered here, attracting a large number of "diamond gold diggers" from all over the world.
Apart from diamonds, Ernest seems to have a natural keen sense of business and politics. In Kimberly, Ernest engaged in the trade between British and German colonies for the first time by virtue of his unique experience of being born in Germany and growing up in Britain. Although this lucrative transaction is extremely risky, it is not difficult for Ernest. While making money calmly, he also accumulated valuable political contacts. 19 12, Ernest was elected mayor of Kimberly for three consecutive terms, and finally entered the South African Parliament on behalf of Kimberly.
During World War I, the diamond mine owned by the Germans named "Forbidden Zone" was occupied by the South African army and could not be started. Therefore, Ernest established Anglo-American Resources Company of South Africa in 19 17 (the initial capital1000000 pounds, half from the United States and half from the United Kingdom, hence the name), and used the company's stock to talk about the acquisition with the Germans. At that time, Germany could not judge the war and did not know whether the South African army would retreat, so it sold this rich mine at a very low price together with the risk of losing money. Ernest. In this way, the Oppenheimer family owned their first diamond mine.
The war soon ended, and the Oppenheimer family's diamond business began to flourish, which brought competitive troubles to another old South African diamond company, Cecil Rhodes' De Beers Company in Britain. At that time, De Beers had a history of more than 30 years and was listed on the Johannesburg Stock Exchange, 1893. At that time, it was the most comprehensive and powerful diamond mining and seller in South Africa.
With the support of rich mines, Ernest started a big price war with Rhodes. After a long time, Rhodes couldn't bear it. Fearing that his company's stock would become rubbish, he took the initiative to negotiate with Ernest at 1926. In the end, Anglo American and De Beers merged in the form of equity swap. This is Ernest's real purpose: with De Beers, other weaker diamond enterprises can be eliminated one by one.
By the end of 1920s, when Rhodes died, Ernest had become an irreplaceable leader of the whole South African diamond industry. However, Ernest's appetite does not stop there. From 65438 to 0929, the global economic depression caused the demand for diamonds to plummet, and the London Diamond Enterprise Alliance came to the brink of bankruptcy-before that, this alliance had been one of De Beers' main competitors. Ernest seized this opportunity to integrate the two enterprises at a very low cost through negotiations with members of the alliance.
1934, Ernest founded the famous Central Sales Organization (CSO) in London, which was responsible for the sales of De Beers diamonds in the international market. Later, CSO became the largest diamond sales channel in the world.
Ernest believes that "the only way to increase the value of diamonds is to make them scarce, that is, to reduce production". The birth of a monopoly diamond dynasty can finally make it practice this theory. Due to Ernest's decision to close all his diamond mines, during the period of 1930- 1933, the world diamond production plummeted from 22 million carats per year to less than 14000 carats, and the price of diamonds continued to rise.
Another benefit brought by monopoly to Ernest is even more obvious: once other diamond companies appear, De Beers will release a large amount of diamond reserves, which will lead to a sharp drop in diamond prices, thus making the other party bankrupt or surrender. This makes it almost impossible for any new entrant to compete with him.
Ernest founded Oppenheimer & Sons Company in 1935, holding all the family businesses. Most of these businesses are packaged in Anglo American Resources Group in South Africa. This model lasted for many years, until 1999, Anglo-American Group of South Africa merged with Minorco, headquartered in Luxembourg, and established Anglo-American Group Co., Ltd., which was listed in London.
In the early 1950s, Ernest became the richest man in South Africa.
It controls 90% of the global diamond rough sales.
Personal glory time is limited after all. 1957, Ernest died. Oppenheimer, 49, inherited all his father's legacy-65.438+0.8 billion dollars, and a diamond dynasty that accounted for 80% of the world's diamond production.
Harry Middle School studied at Chekhov College, one of the oldest aristocratic middle schools in Britain, and later graduated from Christian College of Oxford University. He likes to collect ancient books, quiet, low-key and reserved. Like his father, Harry has a unique political talent. For many years after graduation, he was a member of the South African Parliament until his father died. He had to give up his political career because he had to take care of the huge family business.
Harry is also very talented in business. In 1950s, he was sent to new york by his father to cooperate with many excellent advertisers on Madison Avenue, which is known as the center of American advertising industry. They created the "4C" standards of the diamond industry-cut, color, clarity and carat. In fact, the so-called "4C" standard that modern people are familiar with is not the inheritance of ancient times, but only the result of modern marketing.
Later, Harry and the professional advertising company Zhiwei Thompson created a classic slogan for De Beers: "Diamonds last forever, and one will last forever"-in 2000, this slogan was rated as the most successful advertising copy in the 20th century.
In Harry's era, Britain and the United States almost monopolized the diamond, gold and platinum industries in South Africa, and even the entire business community in South Africa. With the strong cash flow generated by De Beers, Anglo-American resources can acquire more mineral deposits; The proceeds from mining gold, platinum and other metal mines can be invested in other fields. ...
The Oppenheimer family's career reached its peak in Harry's hands: Anglo-American gold and Anglo-American platinum became the world's largest gold and platinum producers respectively, and Miroco became one of the top ten copper producers in the world; In the 1970s, the output value of all Oppenheimer family companies accounted for 10% of South Africa's GDP, and the export value accounted for 30% of South Africa's total export value ... The Oppenheimer family suddenly became the "China" of South Africa.
Before 1980s, De Beers controlled 90% of the world's rough diamond sales. CSO in London only holds 10 diamond appreciation meeting every year, and only 125 buyers who have cooperated with De Beers for a long time can be present. They are called "De Beers 65,438+025". Shoppers buy rough diamonds from De Beers, then grind them into loose diamonds and sell them to jewelry retailers. Since the establishment of CSO, De Beers has been implementing the "supply strategy of choosing customers": he chooses customers, not customers who choose him. Based on this premise, customers can only say "yes" or "no" when granting blank to customers.
However, with the discovery of a large number of diamond mines in Australia, Canada and Russia, South Africa's status as a diamond kingdom gradually wavered after the 1980s. De Beers' market share was once squeezed to 45%. In desperation, Harry took the initiative to break the "De Beers 125" restriction, expanding the market from the original high-end customers to the middle class, advertising like daily consumer goods, and adopting various flexible marketing methods.
By the end of the 20th century, De Beers has successfully transformed into a market-oriented non-monopoly enterprise, and its market share has also rebounded.
The Oppenheimer family has such a family motto: "We hope for the best and prepare for the worst." It seems that Harry has grasped the essence of this family precept.
From monopoly to competition
If Harry's contribution to the family business is to greatly expand the market by breaking high-end barriers, then his son Nicky Oppenheimer will go further and push the company to a modern enterprise model.
1998, when 52-year-old Nicky became the new head of the family, some media said rudely that he "seems to have a bad brain, so I'm afraid it's hard to bear this burden". But the facts soon proved the media wrong.
Under the leadership of Nicky, De Beers cooperated with Louis Vuitton, a well-known luxury goods group, and began to set foot in the diamond retail industry. This move makes De Beers' industrial chain longer and brings more profits to De Beers-compared with diamond mining, diamond jewelry sales are more profitable.
In addition, Nikki changed the CSO, which existed for decades, into a domestic diamond trading company (DTC) and launched a strategy called "Best Supplier". The core of this strategy is to provide more added value for the downstream retailers, wholesalers and retailers, and then firmly attract these downstream enterprises to advance and retreat together around De Beers to enhance their influence on the whole industry. The "best supplier" strategy proved to be successful. In 2004, while the price of diamonds rose by 7%, the global sales of diamond ornaments still increased by 8% compared with 2003. The "best supplier" strategy case is also listed as one of the classic cases by Harvard Business School.
In the history of family development, the most important thing Nicky did happened in 2000. This year, Nicky proposed that the Oppenheimer family and Anglo-American Resources Group jointly invest $654.38+09.7 billion to acquire De Beers. Nicky has been brewing for this acquisition for a long time. Eliminating cross-shareholding is the main motive of restructuring. For more than 70 years, De Beers and Anglo American have been cross-holding, with the former owning 35% of the latter and the latter owning 32% of the former. This kind of cross-shareholding is criticized by investors, and the capital market therefore has a low valuation of De Beers. "De Beers is always undervalued by investors," Nicky said. Since the shareholders don't recognize the value of De Beers, there is no need for the company to continue to make profits for them.
In May of 200 1 year, the reorganization was completed. The Oppenheimer family and Anglo-American companies each hold 45% of the shares of De Beers Company, and the remaining 10% is owned by De Beers Botswana Company, and De Beers Botswana Company and Botswana Government each hold 50% of the shares. This is the biggest reorganization of the world diamond industry since World War II, and it is also the biggest enterprise acquisition in South Africa's economic history. Since then, De Beers has ended its trading history in Johannesburg Stock Exchange 100 years and become a private enterprise.
Many people think that De Beers will become more mysterious and arrogant after privatization. A diamond analyst said pessimistically that the outside world may never know the actual profit of the diamond industry again. However, at the end of July 2003, just two years after De Beers' delisting, Nicky released the company's mid-year performance report for that year to the world. This move is seen as a sign that De Beers is trying to prove that he is becoming more and more transparent. "The world has changed," Nicky said. "When we started to change and become more open and transparent, the sky didn't fall."
Although from middle school to college, Nicky received the same aristocratic education as his father, but compared with his father who is a gentleman, Nicky seems a little unruly. He never wears expensive diamond watches, but often wears plastic electronic watches; He likes playing cricket and bought a professional cricket team. When the media asked him why he wanted to buy a team, his answer was absolutely amazing: "This is the only way I can feel the competition now."
In 2008, Forbes selected the world's most outstanding 14 wealth families, and Oppenheimer family was among them. Today, Nicky's only son Jonathan Oppenheimer is 4 1 year old and has three children. The fourth generation of this family has begun to set foot in the management of family business. However, it is still unknown whether the Oppenheimer family can be equated with the diamond dynasty in the hands of the third or fourth generation.