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Arnault Snags Tajan
by Adrian Darmon
  Move over Sotheby's and Christie's, there's a new player on the auction block. The world's number three art auctioneer, the London-based Phillips International, is merging with L'Etude Tajan, France's largest auction house. The alliance allows Phillips to enter the French market, and extends Tajan's reach into the Anglo-Saxon art world. Terms weren't disclosed.

The move represents continued expansion into the art market by French financier Bernard Arnault, whose LVMH Moet Hennessy Louis Vuitton luxury products group is the actual buyer of Tajan. LVMH bought Phillips, the world's number three auctioneer, for about $110 million late last year. Arnault has also paid over $4 million for a 20 percent stake in icollector, a British-based online auction site, and invested $17 million in the Aucland auction site, a kind of French e-Bay.

Phillips, founded in 1796, has 17 salesrooms in Britain and two in the U.S. In 1999 Phillips organized more than 800 sales, and recorded a $208-million turnover (well behind Sotheby's and Christie's, which each do about $2 billion a year). Phillips' Paris office is headed by Marie-Laure de Cazotte, who is presently trying to find headquarters in the same high-class neighborhood as Christie's and Sotheby's.

L'Etude Tajan, headed by Jacques and Francois Tajan, in 1999 recorded a $73.8 million turnover in more than 150 sales, held at its 2,500-square-meter Paris showroom, in Monte Carlo and Geneva. Tajan has more than 100 employees. In a press statement, Jacques Tajan said, "The LVMH Group symbolizes French taste and culture at its highest level…. We are absolutely delighted to have such strong driving forces behind our international development."

The merger of Phillips and Tajan is the beginning of what promises to be a revolution in the Parisian auction world, following moves taken by the French government to open up the tightly regulated profession to free-market forces. At present, some 110 auctioneers in 66 groups are licensed to hold sales in Paris. In 1999, total sales of art and second-hand goods were $606 million. After the adoption of the impending reform, it is estimated that fewer than 25 groups will survive.

Some groups have already taken steps to preserve their position, such as Poulain-Le Fur, which moved recently to the Palais des Congrès building to organize sales of collectors' cars, its main specialty.

Insiders speculate that e-Bay and Christie's were competing with LVMH in a fierce but hidden battle to gain control of Tajan. The Phillips-Tajan merger gives Arnault a connection to a recently formed international alliance of smaller auctioneers that includes Butterfield & Butterfield in San Francisco, Swann Galleries in New York, Dorotheum in Vienna, Lawson's Galleries in Sydney, Galerie Koller in Zurich and Geneva, Finarte in Milan, Rome and Madrid, Bukowskis from Stockholm and Lempertz in Cologne. This group announced total sales of $379 million last year, and claims a list of 500,000 potential buyers.

E-Bay, which has already dipped its big toe in this alliance by acquiring Butterfield & Butterfield for about $200 million, seems eager to play a still more active role in the association. By missing out on a partnership with the Tajan group, e-Bay missed a chance to become an actor in the French art market.

Insiders speculate that Piasa, France's second-largest auctioneer, may now partner with Christie's, which is headed by Arnault's arch rival, François Pinault. However, Piasa agreed last year to enter into a partnership with Phillips, which to date has not resulted in any practical collaboration. Stay tuned.

ADRIAN DARMON writes on the art market from Paris.