Marion Maneker0April 15, 2014

Bonhams to Sell Portanova Sappho by Fragonard in July

Fragonard Sappho inspired by Cupid

Having sold a Fragonard portrait for £17.1m last year, Bonhams is going back to the master with another work slated for its London sale:

Sappho inspired by Cupid, a sensual work by the French 17th century Master, Jean-Honoré Fragonard, is to be sold at Bonhams Old Master Paintings Sale in London on 9 July.  It is estimated at £800,000-1,200,000.

The painting is known informally as the Portanova Sappho to recognise its previous ownership by the socialite couple Sandra and Ricky di Portanova but also to distinguish it from Fragonard’s other works on the same theme.  It was executed around 1780, when the painter moved away from the Rococo style with which he had established his early reputation and started to experiment with Neoclassicism.  Sappho inspired by Cupid clearly struck a chord with art collectors because Fragonard repeated the composition many times and painted other allegorical works with a romantic theme – The Invocation to Love, The Fountain of Love and The Sacrifice of the Rose, for example, – again, in several versions.  Of the known versions of Sappho inspired by Cupid, the painting in the Bonhams sale is regarded as the highest in quality.

The poet Sappho, born around 600 BCE, lived on the island of Lesbos in the Aegean Sea. She was famed throughout antiquity for her uninhibited approach to love as well as for the quality of her poetry, of which only fragments have survived.  Her work celebrated beauty through love and Fragonard’s painting depicts the figure of Cupid in his traditional guise of a chubby young boy embracing and inspiring the classically perfect, but recognisably human, figure of the poetess. The modern identification of Sappho as a writer of specifically lesbian poetry would almost certainly have been unfamiliar to Fragonard – the terms lesbian and Sapphic were not coined until the last third of the 19th century- and there is no suggestion of this in the image.

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Marion Maneker0April 15, 2014

The Market Doesn’t Like Loeb’s Plan for Sotheby’s

Screen Shot 2014-04-15 at 9.58.51 PM

Third Point’s pitch for Sotheby’s doesn’t seem to be inspiring anyone else to buy the stock. Daniel Loeb’s hedge fund released its case for improving the auction house’s financial performance and charting a growth strategy last night. At this morning’s open, Sotheby’s stock struggled and then broke below the historically significant $40 price floor falling more than 3% before recovering slightly and closing down 2+%.

Marion Maneker0April 15, 2014

Dan Loeb’s 5 Point Plan for Improving Sotheby’s Business

Daniel Loeb

Third Point released a 30-page deck last night making their case for three board seats on Sotheby’s board of directors. Here is Loeb’s list of growth opportunities:


Define what Sotheby’s is today or what it wants to be

◊ Competitors are laser-focused on the consumer experience and their brand, while Sotheby’s appears indifferent

Articulate a long-term growth strategy and vision for the Company and its brand 

Formulate a strategy to manage the inherent cyclicality of its markets

◊ Contingency plan for the next downturn should have both defensive and offensive elements (e.g., prudent management of capital and expenses, opportunity to be a buyer or lender of last resort, development of cycle proof earnings streams)

Auctions & Private Sales

Invest in long-term talent development and recruitment

Cultivate numerous points of contact within the Company so that collectors and consignors become clients of Sotheby’s, not just individual specialists

Invest in front-end technology to facilitate online sales and auctions

Invest in data technology to record private sale and auction inquiries to promote cross-selling, improve customer service, and increase volume

Follow up with clients to drive cross-selling to capture a greater share of each client’s relevant spending

Develop a robust approach to smaller ticket items in order to grow the customer base and compete more effectively with Christie’s

Secured Lending

Deploy more capital against profitable secured lending business, especially now that the business has a separate debt facility to efficiently fund loans (consignor advances, general term loans)

Principal & Dealer

Build a private business: initiate a greater number of curated auctions and exhibitions to leverage Sotheby’s client base, real estate, and relationships

◊ Opportunity exists to take share from art dealers and gallery owners (some of which are rumored to be generating over $ 1 billion of sales annually) given Sotheby’s superior and continuous legacy, global footprint, and in-house expertise

No defined long-term plan for the Company’s S|2 galleries

◊ How are artists chosen?
◊ How does Sotheby’s leverage its entire platform to promote them?
◊ And why is it even called S|2 and not Sotheby’s?

Consider partnering with living artists and representing artists’ estates

Brand Extension

Explore additional brand extension opportunities

◊ E.g., wine storage, data analytics

Develop a more thoughtful retail strategy

◊ What is the long-term plan for Sotheby’s Diamonds and Sotheby’s Wine?

◊ How can the Company better utilize its locations when auctions aren’t happening?

Third Point Sotheby’s Presentation

Marion Maneker0April 15, 2014

Loeb Shifts Targets on Sotheby’s Board

Daniel Loeb released his case for the upcoming board fight for Sotheby’s last night. Among the tactical moves is a shift to opposing two current board members and one of the management’s new nominees: (as seen above) Robert A. Taubman, Jessica M. Bibliowicz and Danny Meyer.

In this case, we believe that three is the right number given the total size of the Sotheby’s Board (12 directors), the number of committees on the Board, and the specific challenges faced by the Company. Furthermore, three directors has proven to be effective for Third Point in the past, e.g., three Third Point nominees were elected to the Yahoo! Board

The BID nominees we oppose (Robert A. Taubman, Daniel Meyer, and Jessica M. Bibliowicz), collectively, have limited share ownership and qualifications that do not appear to add value for Sotheby’s shareholders

The switch shifts the debate from being our slate versus their slate while still trying to gain enough influence on the board.

Read the rest of the presentation here: Third Point Sotheby’s Presentation

Marion Maneker0April 14, 2014

The Curators We Deserve?


The Financial Times has run an edited version of Harald Falckenberg’s essay for Art Basel 44. The art market overview has gotten a strong response and is well worth reading whether you agree with Falckeberg or not. Here are just two excerpts worth pondering:

At the same time, the growth of now almost 100 biennials and triennials around the world saw the orientation and organisation of “critical art”, with its often counter-cultural impulses, increasingly defined by a network of international curators, so significant that they are accused of “curatism”: a group of impresarios who use artists as living arguments and evidence of their own ideas. […]

Personally I’m neither a believer nor a pessimist. I track the evolution of this society and its art. While others might think that evolution always leads to something better, to me there is no morality in the process. Just change. The end of art has repeatedly been announced. But there is no end: art is always open to new developments. Every serious collection has to face this challenge.

The art world we deserve?  (Financial Times)

Marion Maneker0April 14, 2014

The Case Against Anyone Owning Sotheby’s

Sotheby's Headquarters

During Friday’s stock sell-off, Sotheby’s (BID) held its $40 price floor suggesting there are buyers at the crucial support/ceiling level. Nonetheless, at least one fund manager doesn’t see the logic in the stock at that level or above considering the strong valuation against earnings:

Art aficionado Christopher Tsai, 39, who runs Tsai Capital, a much smaller hedge fund in New York — and owns 40 works, considered one of the world’s largest collections, by the world-famous Ai Weiwei of China — had this advice for Loeb: Get real.

Tsai doesn’t see a lot of value in Sotheby’s stock, regardless of any future window dressing and the recent sell-off.

“This is a cyclical name, and one is paying 18 times 2014 earnings for a company that is producing close to record revenue and healthy earnings,” Tsai told The Post.

“That’s a lot different than paying 18 times for trough earnings. For that reason, despite any change that Loeb may facilitate, [Loeb’s] investment could wind up taking a long time before paying off in a meaningful way.”

Hedgie not sold on Loeb for Sotheby (New York Post)

Marion Maneker0April 14, 2014

Paying the Tax Man in Art Works

David Alfaro Siqueiros

The Atlantic unearths an interesting program in Mexico that allows artists to pay their taxes in art. With the rise of ambitious programs like the Artist’s Pension Trust, the idea of sponsoring artists by allowing satisfy obligations with their work is compelling:

For the past 28 years, Gritón has not paid a dime to the Tax Administration Service (SAT), the Mexican equivalent of the IRS. But he is no criminal. In fact, in a country that has lost an estimated $872 billion to money laundering and tax evasion over the past four decades, Gritón is in good standing with the law. Like more than 700 artists across Mexico, he takes part in a Pago en Especie (Payment in Kind) program—the only one of its type in the world—that allows artists to pay federal income taxes with their own artwork.

The program was hatched in 1957, in the throes of the so-called “Mexican Miracle,” a period of 40 years that saw sustained annual economic growth of between 3 and 4 percent. As legend has it, muralist David Alfaro Siqueiros, one of the most influential artists of his generation, approached the secretariat of finance in 1957 with a proposal to keep a friend and fellow artist out of jail for tax evasion: Let him pay his debt in art. The agreement laid the foundation for Pago en Especie, which today is a public collection of nearly 7,000 paintings, sculptures, and graphics accepted as tax payments from some of Mexico’s best-known artists. […]

The program is simple—donations are made according to reported sales. If an artist sells between one and five pieces of art in a given year, he or she donates one piece to the federal government. If the artist sells between six and eight pieces, he or she donates two, and so on, with an annual cap of six donations. Only painters, sculptors, and graphic artists can participate, though program administrators are currently considering whether to include performance art as an acceptable means of payment. A committee of artists and curators oversees the donations process to ensure that the art received meets certain quality standards. If the art is of a particularly high caliber, it becomes part of the “national-heritage collection,” which is displayed in a permanent exhibit in Mexico City. All other pieces are divided up and shipped across the country to fill public museums and administrative buildings.

In Mexico, Artists Can Pay Taxes With Artwork (Atlantic)

Marion Maneker0April 14, 2014

David Hammons Joins Maya Lin in Yonkers, the New SoHo

39 Lawrence St, Yonkers, NY

Yonkers is turning into the new SoHo or Chelsea as artists move into the Hudson River community that lies just across the border from the Bronx:

The artist David Hammons has bought a warehouse in a section of southwest Yonkers, where he will open a new art gallery. Hammons is the latest artist to buy property in the city with the goal of exhibiting work.

In November city officials announced that they had sold the former Yonkers City Jail on Alexander Street to artist and architect Maya Lin and her husband Daniel Wolf, who will convert part of the jail into an exhibition space.

Artist David Hammons buys Yonkers property; to open gallery (LoHud)

Collectors, General
Marion Maneker0April 14, 2014

The $11m Loophole or Why Bacon’s Freud Stopped in Oregon

Tax Break Illustration

The Times explains why the $142m Francis Bacon triptych of Lucian Freud was shown so quickly in a museum in Portland, Oregon. At the time, the answer was given as taxes. But here the Times actually explains the process:

Dozens of important works have come to the Schnitzer in recent years, largely because of the tax break, museum officials believe — so many that the museum has a program called “Masterworks on Loan”; the featured works are housed in a second-floor gallery.

Similar loans — which rarely extend beyond a few months — also flow into other museums in Oregon, and occasionally New Hampshire and Delaware, all states that have neither a sales nor a use tax. […]

Experts said that for many years it was known in art circles as the “Norton Simon rule,” because Mr. Simon, an industrialist who died in 1993, was one of the first art collectors to make ample use of it with loans to several museums like the Portland Art Museum.

Buyers Find Tax Break on Art: Let It Hang Awhile in Oregon (NYTimes)

Marion Maneker0April 13, 2014

Equatorial Guinea’s $104m Impressionist Art Trove Under Investigation

French investigative site Mediapart reports on potential looting by an African leader:

Teodoro Nguema Obiang Mangue, son of the long-serving president of Equatorial Guinea and vice-president in his own right, is under formal investigation by French judges for money laundering. At the heart of the affair are claims that Obiang, who is also defence minister and interior minister, has plundered his country’s natural wealth to amass a fabulous collection of late nineteenth art worth 104 million dollars that lined the walls of his luxurious home in Paris. Meanwhile 60% of Equatorial Guinea’s population have to survive on less than a dollar a day.

The Art of Corruption (Mediapart)