Blackstone buys jewellery certification business, China's Fosun exits
The Blackstone Group has paid USD 569.7m for 100% of Belgium-headquartered jewellery certification business International Gemological Institute (IGI), taking out investors including China’s Fosun Group.
Shanghai Yuyuan Tourist Mart, a listed retail holding group controlled by Fosun, said in a filing that it would fully exit three IGI-related entities. Fosun acquired an 80% stake in IGI in 2018 from Roland Lorie – who currently serves as CEO – and Marc Brauner for USD 108.8m. The founding Lorie family retained 20%, although they have now also sold to Blackstone.
The PE firm is investing via its second Asia fund; it closed at the hard cap of USD 6.4bn in late 2021. The vehicle is nearly three times the size of its 2018-vintage predecessor, which closed on USD 2.3bn.
Established in 1975, IGI is a global leader in independent certification of loose diamonds, coloured gemstones, and finished jewellery. It has 29 laboratories and 18 schools of gemmology across 10 countries. The bulk of its offices are in India, which is responsible for polishing most of the diamonds discovered globally.
IGI is the world’s first gemological laboratory to be accredited by the Organization for International Standardization (ISO) in both natural and lab-grown diamonds. Since 2005, it has pioneered the certification of lab-grown diamonds, paving the authentication and standardisation of a rapidly growing industry, according to a statement.
“IGI has had a successful track record for close to 50 years since we founded the company, and we are pleased to entrust Blackstone to take IGI on to its next stage of development,” said Lorie.
“IGI has been a pioneer in developing products adapted to manufacturers, retailers and consumers’ expectations. Under the patronage of Blackstone, we intend to get even closer to the consumer and to grow the business exponentially.”
In 2022, IGI posted operating income of approximately USD 94.5m and a net profit of USD 34.5m, the filing noted.
The global natural diamond jewellery market was worth USD 87bn in 2021, while sales of polished diamonds amounted to USD 28bn, according to DeBeers. China and India are the second and third-largest markets for jewellery, but their combined total is less than half that of the US.
Allied Market Research valued the global lab-grown diamond market at USD 22.3bn in 2021 and projected it would reach USD 55.6bn by 2031. Tenoris, a trend analytics provider serving the jewellery and gemstone industries, predicts that before year-end, a majority of loose diamonds sold by US speciality retailers will be lab-grown diamonds.
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