The Diamond Store seeks sparkle with hunt for new investors

Britain's biggest online diamond jewellery retailer is exploring the sale of a stake in the business to outside investors for the first time in its 69-year history.

Sky News has learnt that The Diamond Store, which is owned by its founding family, is working with advisers on a process to bring in new backers amid growing appetite among consumers for lab-grown diamonds. Sources close to the process said talks were already active with a substantial number of prospective investors.

Cavendish, the investment bank, is overseeing the discussions with potential backers. Money latest: How the way we travel will soon start changing The Diamond Store sells jewellery incorporating both natural and lab-grown diamonds, with a report by the consulting firm Bain & Company saying that sales of the latter grew by approximately 40% in 2022, as a result of increasing consumer demand, better production efficiencies and wider retail adoption.

The identities of the interested parties were unclear. "We're seeing a vast and growing appetite for lab-grown diamonds across Europe, particularly in markets where awareness is rising but choice remains limited," said Jeremy Kanzen, The Diamond Store chief executive.

"We are actively exploring strategic partnerships to help accelerate our international expansion and meet this demand. "Selective physical presence, both in the UK and key European cities, through premium concessions and pop-ups, will play a vital role in strengthening brand visibility, building trust and driving high-value conversions." "Global sales of lab-grown diamonds now account for nearly 20% of the global diamond market, with that figure expected to rise significantly over the next five years," Mr Kanzen added.

"Consumers, especially younger audiences, are rapidly moving away from legacy retail models in favour of brands that offer ethical innovation, transparency, and seamless online experiences." The company employs about 70 people and is based in London, having been founded in Hatton Garden, the heartland of the capital's jewellery industry. The Diamond Store's revenues are growing at a double-digit rate, with the potential for its earnings before interest, tax, depreciation and amortisation (EBITDA) to double in the next three years with a new partner, Mr Kanzen said.

Its talks with investors come two years after Vashi, a diamond jewellery retailer founded by Vashi Dominguez, collapsed into liquidation, leaving a trail of backers with multimillion pound losses. Mr Dominguez has faced allegations from his backers that the business operated fraudulently, with the founder alleged to have asked staff to pose as customers..