Anglo American Plc is set to increase its stake in De Beers by buying out the Oppenheimer family's holdings in the company for a £3.1-billion ($5.1 billion) deal. With this deal, the Anglo American stakes will rise to 85 percent from the current 45 percent in the diamond business.

The global mining company has entered into an agreement with CHL Group which represents Oppenheimer family interest, to buy its 40 percent stake, agreeing to Botswana's pre-emption right over the CHL shares, increasing government's ownership upto 25 percent.

Anglo has been a shareholder in De Beers for over eight decades and the company's largest shareholder since De Beers became a private company in 2001. It has been trying for an increased stake in the diamond producer, but the Oppenheimers had so far resisted a sale, according to a Reuters report.

"This transaction is a unique opportunity for Anglo American to consolidate control of the world's leading diamond company- De Beers," said Cynthia Carroll, Chief Executive of Anglo American in a statement.

De Beers' shares posted a 55 percent increase in its first-half earnings driven by record sales in leading markets like India, China and the United States. Analysts welcomed the deal at valuations they said were in line with smaller, listed producers like Gem Diamonds. Shares in Anglo climbed 1.6 percent to 23.95 pounds at 0843 GMT, outperforming a 0.8 percent increase in the sector, reports Reuters.