Sotheby’s buys prestigious art advisory firm in $85m deal

Founders of Art Agency, Partners will head up new department, along with Marc Porter, former Americas chairman at Christie’s


In a bold move, Sotheby’s auction house has acquired the powerhouse advisory Art Agency, Partners. Founded less than two years ago by Amy Cappellazzo, the former chairwoman of Christie’s post-war and contemporary art department, and Allan Schwartzman, one of the world’s leading art advisers, the firm is renowned for having one of the best address books in the business.

Sotheby’s has paid $50m cash for the firm with an additional $35m payable over the next five years if certain targets are hit. As part of the deal, Sotheby’s has bought the company and taken control of its 15-member staff and its advisory business.

Effective immediately, Cappellazzo and Schwartzman will become co-leaders and chairmen of a new fine art division at Sotheby’s. Their remit covers art from Impressionism and Modern through post-war and contemporary. It will expand to encompass other categories within the 20th and 21st centuries such as American, Latin American and British art.

The third partner in the advisory, Adam Chinn, a former lawyer with a background in boutique investment banks, will take on a new role at Sotheby’s, as the worldwide head of transaction support. Art Agency, Partners’ 12 remaining staff will transition to Sotheby’s over the coming month.

Adding to the mix is Marc Porter, who had been at rival firm Christie’s for more than 25 years, most recently as chairman of its business in the Americas. He is on gardening leave until 2017 but will then become a chairman in the new fine art division, leading its business development.

The fine art division will be integrated into Sotheby’s and all staff members will report to Tad Smith, who joined the auction house as its chief executive last year.

The acquisition of Art Agency, Partners “helps drive initiatives that are imperative for Sotheby’s growth,” Smith says in a statement. These include “improving our leadership position at the high end of the fine art market, bolstering our private sales capability, giving us new growth opportunities in advisory services, and reinforcing the client-first culture in all we do”.

It is a coup for Sotheby’s, which ended 2015 with something of a bloody nose. Last summer it issued the biggest ever guarantee in auction history, $515m, for the estate of its former owner Alfred Taubman. With more works yet to be auctioned from the collection, it nonetheless looks like Sotheby’s will struggle to break even once costs such as marketing are included. And, despite announcing its most successful sales season ever in November, the firm went on to unveil a voluntary redundancy scheme as a cost-cutting measure.

The acquisition of Art Agency, Partners marks a new chapter for Sotheby’s and represents a more aggressive approach to growing the business. The move will be seen as a threat to private dealers because of its focus on client relations. According to Smith, the “most important” thing about Art Agency Partners is its “unique approach to client service in all areas of its advisory work, from art consulting and private purchases and sales to art-related estate planning, museum development and art investment.”