Blackstone acquires International Gemological Institute for $535 million

Global private equity firm Blackstone has acquired 100% stake in International Gemological Institute (IGI) from China-based investment firm Fosun, and Roland Lorie, who belongs to the founding family, the firm said in a release.

IGI is the largest certification player globally for lab grown diamonds and second largest certification player globally for natural diamonds.

While Fosun held 80% of the stake, 20% was held by Rolan Lorie. The deal values IGI at an enterprise value of $535 million

Founded in 1975 in Antwerp, IGI is a global player with a global footprint of 29 laboratories and 18 schools of gemology across 10 countries. IGI is the world’s first gemological laboratory to hold ISO accreditation in both natural and lab-grown diamonds. Since 2005, IGI has pioneered the certification of lab-grown diamonds, paving the authentication and standardization of a rapidly growing industry.

“IGI has spearheaded the certification of natural diamonds, lab-grown diamonds, and colored stones, became a global market leader and providing confidence to manufacturers, retailers, and consumers around the world. We are bringing the best of Blackstone to the business – our operational expertise, capabilities in technology, and global track record in building businesses to help the company expand its global footprint,” said Mukesh Mehta, senior managing director in Blackstone Private Equity Group.

According to industry estimates, the global lab grown diamonds retail market currently stands at $7 billion and has grown at 15% CAGR over CY19-22. The global natural diamond jewellery retail sales are pegged at around $80 billion which is growing at 3% CAGR. Of this almost 90% of rough diamonds are polished in India.

“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,” said `Roland Lorie, Chief Executive Officer of IGI.

“Today, IGI’s business is more diversified and solid with a more globalized landscape,” said Kevin Shikun, co-chief investment officer of Fosun and co-chairman of Yuyuan, a subsidiary of Fosun. Yuyuan expects positive impacts on its financials through this sale, and further focusing of resources on the company’s key strategies and projects, the release said.

Ever since the geopolitical standoff with China began beginning June, 2020 leading to Chinese firms exiting Indian investments, Fosun has been selling down its portfolio in the country. This is one of the last investments from its almost decade long portfolio. Previously it sold stake in companies such as Ixigo, Kissht and Delhivery. It is also in the process of looking for exit from Trell, Gland Pharma among its other investments.