Art & Finance Newsletter #26 - Art Financing Company Sold
Did anybody catch the astounding USD14.7 mio sale of the (estimated) USD1 mio KAWS painting at the recent auction in Hong Kong? Crazy stuff...
On to the art market...
Carlyle-backed Art Finance Business Sold for $170m
Athena Art Finance, one of the world’s top lenders to buyers of artwork by the likes of Claude Monet, Pablo Picasso and Andy Warhol, has agreed to sell itself for about $170m to YieldStreet, a rapidly growing digital wealth management platform backed by billionaire George Soros.
The sale of Athena comes four years after it was launched by a consortium of investors led by the private equity group Carlyle under the stewardship of Olivier Sarkozy, a former managing director at Carlyle and half-brother of the former French president Nicolas Sarkozy.
Athena, which also counts Banque Pictet among its founding investors, has emerged as one of the most active providers of financing to art dealers, galleries and collectors seeking to secure fine art.
It offers borrowers up to 50 per cent of the value of pieces from dozens of painters who meet certain quality criteria, and then it packages the loans and distributes them in the market. Since 2015, Athena has provided over $225m in financing for rich art buyers.
YieldStreet is also a start-up, launched in 2015 by three Wall Street entrepreneurs, which has said its mission is to “democratise” investments usually reserved for institutional investors, hedge funds and rich family offices including Soros Fund Management.
FT - Carlyle-backed Art Finance Business Sold
Art Dealer Pays $4.2 Million to Settle ‘Fake’ Old Master Dispute
Art dealer Mark Weiss and his company have paid $4.2 million to settle a lawsuit with Sotheby’s auction house after an Old Master painting he once owned got caught up in a forgery scandal that shocked the art world.
Details of the settlement are set out in Weiss’s court filings for a trial that started Monday over the painting, “Portrait of a Gentleman,” which was attributed to the Dutch Golden Age artist Frans Hals. The painting was drawn into a scandal after technicians hired by Sotheby’s discovered pigments in paint that could only have been used four centuries after the artist’s death.
Sotheby’s declared the artwork a forgery in 2016 and reimbursed U.S. real estate investor Richard Hedreen, who’d paid $10.8 million for the piece in 2011, it said in its court filings. It’s still suing Fairlight Art Ventures LLP, a vehicle owned by hedge fund manager David Kowitz that co-owned the painting with Weiss’ company, Mark Weiss Ltd.
Bloomberg - Art Dealer Pays to Settle 'Fake' Old Masters
Art World Con on Trial in NYC
The contemporary art center and social club that alleged con artist Anna Sorokin, aka Anna Delvey, pitched to potential investors and lenders has become a major focus in her ongoing trial in New York State Supreme Court.
Several banking executives testified last week that Sorokin lied about her assets and net worth in order to secure tens of millions of dollars in funding for the purported Anna Delvey Foundation, which was to be housed in a historic building on Park Avenue South.
On Friday, Dennis Onabajo, formerly a banker at Fortress Investments, outlined Sorokin’s attempts to borrow as much as $29 million, which failed when she didn’t satisfy due diligence requirements and background checks. Among the red flags raised during the process was a discrepancy in her birthplace: Onabajo said Sorokin told the bank she was born in Germany, but a designation on a separate identification card listed her place of birth as Russia.
When Onabajo requested more detail about Sorokin’s assets and the source of her wealth, she allegedly furnished letters from nonexistent accountants who prosecutors said were “completely fabricated.” (Among the internet searches prosecutors said Sorokin conducted were how to create fake emails that don’t bounce back.)
Sorokin is charged with grand larceny in the first degree, grand larceny in the second and third degrees, and theft of services. She faces up to 15 years in jail if convicted. Since late 2017, when she was arrested, she has been held without bail at Riker’s Island.
Artnet - Art World Con on Trial in NYC
Busy time of year - so keeping things brief these months.
I hope that is ok with everybody!
Speak soon,
Blake