Last year Sabanci took over control of its retailing joint venture (with Carrefour of France), which has been losing money.
The retailing joint venture and the revamping are elements in the De Beers strategy to transform the diamond industry, which it dominates, into a branded-goods business.
The supplier-of-choice agreement will not prevent the wholesalers from selling to rivals of the De Beers-LVMH retailing joint venture.
The two parties have a retailing joint venture – Rangers Retail Ltd – which sells merchandise to fans of the 54-times Scottish football champions.
François Delage, chief executive of De Beers Diamond Jewellers, a retailing joint venture with the French luxury goods company LVMH Moët Hennessy Louis Vuitton, said in an e-mail that mainland Chinese clients were already regular clients in the company's stores in the region, as well as in Paris and London, favoring high-quality designs and settings.
China eased limits on foreign ownership of retail ventures in 2004, letting companies take full control of operations that once were required to be joint ventures.
But it does not do business directly with its own retail joint venture.
It financed the purchase of LoveFilm; is a 50% investor in Joyo, a Chinese online retail joint venture; and bought 100% of Joyo.com, a British Virgin Islands company, for €105m in 2010.
The issue has become so fraught that De Beers this week threatened Survival International with a lawsuit for continuing to insist publicly that evictions of Bushmen were linked to diamond mining, a connection denied by the Botswana government, by European legislators, by other British and Botswanan advocacy groups, by De Beers and by De Beers LV, the retail joint venture.
Instead, Andrew Coxon, the chief diamond buyer and one of a number of De Beers executives who have moved over to the retail joint venture, has been scouring wholesale diamond markets, particularly in Russia and Canada, to find the kinds of cut stones that suit his purpose.
The French luxury group LVMH Moët Hennessy Louis Vuitton says that its new retail joint venture in diamond jewelry with De Beers will be headed by Alain Lorenzo, currently chief executive of eLUXURY.com., an LVMH Web site, Mr. Lorenzo was previously chief executive of Parfums Givenchy, and spent 12 years in sales and marketing with Procter & Gamble in Europe.
