The New York art gallery set up by the father of Donald Trump’s Treasury secretary Steve Mnuchin is trying to sell an abstract painting, previously owned by guitarist Eric Clapton, via an initial share offer valuing it at US$35m.
Liechtenstein-based firm Artex Global Markets is seeking to raise at least US$31.5m through the sale of 315,000 B shares at US$100 each in a special purpose vehicle set up to own Abstraktes Bild (809-4) by Gerhard Richter, an artist known for applying paint using squeegee mops.
“Crafted through the artist’s renowned squeegee technique that involves dragging a large flat tool across the wet paint, this painting features captivating colour formations and unusual depth and texture,” said the information memorandum.
“[It] stands as one of Richter’s most sought-after abstract works where the squeegee shapes the surface, devoid of any discernible traces of the artist’s hand.”
The painting was sold by Clapton at auction in New York for US$34.4m in 2012 and then more recently at Christie’s in New York for US$38.2m to the Mnuchin Gallery, which was set up by Robert Mnuchin in 1992 after a 33-year career at Goldman Sachs, mainly in equities.
The gallery has a history of splashing out huge sums on living artists. It bid US$80m at Christie’s, or US$91.1m once fees were included, for Jeff Koons’ Rabbit sculptures in 2019, according to reports.
Now investors have been offered the opportunity to buy shares in Richter’s painting, one of the most highly valued pieces of abstract art, via an offering by Art Share 003. The company is being advised by Rothschild and Zeus Capital is sole bookrunner.
Zeus is seeking to sell 90% of the total number of shares, valuing the painting at US$35m. Purchasers are expected to be largely wealth managers and private banks in Switzerland, France and the UK. The offer period was scheduled to close this week with a listing in early October on Artex's own trading venue, which is regulated by the Liechtenstein Financial Market Authority.
If there is demand, all 350,000 shares will be sold. After the sale, the piece will be loaned for free to a public gallery.
In May 2023 Artex made its debut in this niche area, selling 70% of Francis Bacon’s triptych of his friend George Dyer, valuing that work at US$55m.
Artex chief executive Yassir Benjelloun-Touimi, who co-founded the firm with Prince Wenceslas of Liechtenstein, said he hoped to sell more art via this method.
“We hope to bring three artworks over the next three months,” he told IFR, with pieces by renowned modern artists Jean-Michel Basquiat, Georges Rouault and Pablo Picasso being considered with price tags of between US$70m to US$100m.
He said Artex was also working on one valued at US$210m. “Bigger is better. We are working on a phenomenal piece and are pursuing some of the most valuable art works on the planet,” he said.
For owners, selling a piece via a securities offering is cheaper than selling at auction, in which hefty fees are charged to both sellers and buyers. The current sale will cost a maximum of US$2.85m in fees, or around 8%, below the 10% that an auction house might charge as a minimum.
Art lovers have previously been able to buy units in investment funds that buy collections of art but have rarely been able to buy shares in single pieces themselves.
Hedge fund managers, such as Steven Cohen and Ken Griffin, have become major collectors in recent years, suggesting novel sales through share offers might become more prevalent.
Bacon's painting has been listed in Liechtenstein since March and commonly has a bid-offer spread of 10 cents, indicating that the shares are reasonably liquid. Its share price has drifted down 6.4% since admission to €93.60.
Artex 003 had a pre-listing committee that included Roman Schmidt, former head of debt capital markets at Deutsche Bank, Barclays and Commerzbank, as well as head of European government bond trading at Credit Suisse.