Lev Leviev vs De Beers
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Case Code: ECOA125 Case Length: 13 Pages Period: 2004 Pub Date: 2004 Teaching Note: Not Available |
Price: Rs.300 Organization : De beers, Lev Leviev Industry : Diamond Countries : South Africa, Global Themes: - |
Abstract Case Intro 1 Excerpts
Introduction
For about 100 years De Beers, the South African company had been the unchallenged monopoly in the diamonds business. Until a few years back, De Beers could determine who could buy uncut stones, in what quantities and quality and decide which cutting centers would be used. But its share of the rough-diamond market, 80% five years ago, had reduced to 45% by mid-20041. Meanwhile Lev Leviev (Leviev), a former De Beers sightholder (one of the few exclusive direct buyers of De Beers rough diamonds), had emerged as the world's largest cutter and polisher of precious gems.
Leviev also provided rough stones to other cutters, polishers and jewelry makers around the globe. Leviev was the diamond industry's first dealer to operate across the value chain from mining and cutting to polishing and retailing. Frustrated by De Beers' high-handed treatment of buyers, who were offered rough diamonds at take-it-or-leave-it prices and risked being permanently cut off if they resisted, Leviev had decided to operate on his own. Leviev had begun dealing directly with diamond-producing governments. This undermined De Beers' all-important relationship with sight holders...
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