Diamond giant De Beers has reportedly held talks with its largest shareholder Anglo American over increasing its 45 percent stake.

The London Evening Standard reported on Monday that the discussions have taken place amid De Beers' attempts to restructure its finances in the face of declining global demand for its diamonds.

The suggestion that Anglo American increase its stake is one of the options being suggested by De Beers management as it attempts to refinance a $1.5-billion loan facility by raising more cash from investors.

De Beers has also suggested its other shareholders, the Oppenheimer family and the Botswanan government take new equity in the business.

The Oppenheimer family owns 40 percent of De Beers while the Botswana government, through Debswana, holds the remaining 15 percent stake.

Another option would include shareholders injecting cash into the business to ease the concerns of De Beers' debt holders.

De Beers last month revealed a 40 percent drop in diamond production to 7.885-million carats in the third quarter ending September 2009.

While output was 43 percent higher than the previous quarter's production, full year diamond production is expected to be 50 percent lower than 2008 levels.

Consumers have been less inclined to buy precious stones in the financial crisis, while demand for industrial diamonds has also fallen as factory activity has slowed around the world.

Late last week, other reports said De Beers was confident that banks would renew its $1.5 billion debt facility before it comes due in March next year.

The diamond giant has another $2-billion of debt due in 2012.

Anglo American CEO Cynthia Carroll in October confirmed that the group continues to regard diamonds as a core business.

The multi-commodity miner had just days early announced a major reorganisation that would involve the sale of none-core assets such as a steel unit and zinc mines.

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