NEW YORK—News that hedge fund manager Steven A. Cohen, through his company SAC Capital Advisors, has increased his ownership stake in Sotheby’s—combined with an upcoming exhibition of major works from Cohen’s collection at the auction house—is prompting speculation about the collector’s motives and whether he is interested in acquiring the auctioneer and possibly taking it private.
In a March 9 filing with the U.S. Securities and Exchange Commission, SAC Capital, which was founded and is managed by Cohen, revealed it owns more than 3.9 million shares in Sotheby’s, which represents a 5.9 percent stake in the company. SAC’s current holding represents an increase from 3.1 million shares, or a 4.7 percent stake, at the end of last year. SAC is now the third-largest Sotheby’s shareholder, after Ariel Investments and Private Capital Management. Representatives for Sotheby’s and Cohen declined to comment.
Baron Growth Fund, managed by investor Ronald Baron, has the largest Sotheby’s holdings of any mutual fund, with 3.2 million shares, or a 4.8 percent stake, listed at the end of 2008.
Among Sotheby’s executives, CEO William Ruprecht holds 556,965 shares, while John Angelo, who founded and manages the Angelo Gordon hedge fund and who sits on Sotheby’s board, has acquired 140,000 shares of Sotheby’s stock since the start of the month, for prices ranging from $6.73 to $8.10 a share, according to financial filings. As of March 16, Angelo held 175,000 shares of Sotheby’s stock.
Sotheby’s stock, which is traded on the New York Stock Exchange, has risen considerably since SAC’s ownership filing on March 9, when it was trading at under $6.50 a share. As ARTnewsletter went to press, shares were trading at $10.
Sotheby’s also announced last month that it will host “Women,” a thematic exhibition of selected works from Cohen’s collection (April 2–14), featuring depictions of women by Paul Cézanne, Amedeo Modigliani, Edvard Munch, Pablo Picasso, Vincent van Gogh and Andy Warhol.
The list of works included provides a glimpse into the normally secretive Cohen’s extensive collection. The show is to feature van Gogh’s Portrait of a Young Peasant Girl, 1890, one of two works that Las Vegas casino mogul and collector Steve Wynn sold to Cohen in 2005—along with Paul Gauguin’s Bathers, 1902—for about $120 million.
Another of Cohen’s works, Picasso’s oil Le Repos, 1932, was sold by Christie’s in May 2006 for $34.7 million, far exceeding the estimate of $15 million/20 million. Cindy Sherman’s black and white photo Untitled Film Still #21, 1978, from an edition of three, will also be featured. (Another photo from the same edition sold at Christie’s in November 2003 for $169,900 against an estimate of $80,000/120,000.)
Among other works included in the upcoming show: South African–born Dutch artist Marlene Dumas’s oil The Visitor, 1995, which sold for £3.2 million ($6.3 million) at Sotheby’s in London last July (estimate: £800,000/1.2 million), and Lisa Yuskavage’s oil Night, 1999–2000, which was sold at Christie’s in New York in May 2007 for $1.4 million (estimate: $800,000/1.2 million).
In a Sotheby’s statement, Tobias Meyer, worldwide head of contemporary art, said that the idea for the show emerged during a recent visit to Cohen’s house. While he was seated at the dinner table, Meyer said, “Picasso’s Le Repos and Warhol’s Turquoise Marilyn were both directly in my line of sight. Seeing those two works together showed the breadth that different artists can achieve with the same subject . . . I turned to Steve and suggested that we show his ‘Women’ at Sotheby’s. ‘Let’s do it’ he said.”
In the same statement Cohen said, “We found the idea of focusing on one theme intriguing. Our collection has not been curated before and to see this carefully selected group hanging together . . . provides a fresh context that allows us to see these works in a whole new light. We’re delighted to be able to share part of our collection with the public.”
As Cohen was increasing his stake in the auction house, Sotheby’s officials continued their efforts to cut costs (ANL, 1/20/09) in order to adapt to the current economic downturn. According to a filing Sotheby’s made with the SEC on March 23, Ruprecht agreed to a $100,000 reduction in his annual base salary, to $600,000 from $700,000, effective April 1. The reduction “was initiated by Mr. Ruprecht as part of the Company’s ongoing cost reduction efforts,” according to the filing. Also according to the filing, Sotheby’s compensation committee has determined that, effective May 1, the salaries of the company’s named executive officers (NEOs) will be cut by 10 percent.