Time of Trouble

Kim Reierson Antezana

Osvaldo Patrizzi has announced plans to establish his own firm in Geneva.

Send a letter to the Editor

Save to Del.icio.us Digg this

Osvaldo Patrizzi’s abrupt departure last August from Geneva-based Antiquorum, the leading watch auctioneer, continues to reverberate in the rarefied world of luxury timepieces. The Italian-born Patrizzi, 63, quit the house— which he founded in 1974 and which under his leadership regularly outsold both Christie’s and Sotheby’s in the category—after a power struggle with Artist House Holdings Inc., the Japanese company that acquired it for a reported $30 million in 2006.

On April 8, Patrizzi announced plans to launch Patrizzi & Co. in Geneva, to be headed by an executive team of former Antiquorum specialists. Half a dozen auctions are planned annually for New York, Hong Kong and Geneva, where the first one will take place this fall. Patrizzi promises to “revolutionize” watch sales by allowing buyers to bid not only on the premises but also online, in four simultaneous auctions during which he aims to sell 1,500 lots—far more than the usual one-day maximum of 500. He also vows to ditch printed catalogues, which are costly to produce, and instead will allow clients to download “personalized copies” detailing only the lots that interest them. An online catalogue will send automated signals alerting these prospective bidders to the imminent sale of their selected lots.

Thanks to these profitboosting initiatives, Patrizzi says, his firm will levy “zero buyer’s commission,” a revolutionary concept. The firm will generate income by splitting with vendors the difference between the hammer price and the reserve, which will be noted in the catalogue.

The day after Patrizzi went public with his plans, Antiquorum announced that it was suing him for SF43 million ($41 million), because “new evidence had come to light” of “massive fraud” at the firm during his leadership. Patrizzi retaliated immediately by promising to countersue for “defamatory accusations.” He characterizes Antiquorum’s legal action as “yet another of many attempts to destabilize, manipulate and intimidate” him and his associates— and as proof, he believes, that it views the launch of Patrizzi & Co. as “a threat to its own long-term prospects.”

That same day, Yo Tsukahara, who took over as ceo after Patrizzi’s departure, revealed that Artist House had “decided to back further funding” to “reinforce the financial stability of Antiquorum.” In the following weeks, Artist House changed its shareholding structure, effected a redistribution of shareholder voting rights and parted company with its auditors. These shifts culminated on May 9 in an agreement to sell Antiquorum to the Hong Kong–based consortium Forever Most Investment Ltd.

Without announcing that deal, the house proceeded with its May 10 and 11 auction of 705 watches from the collection of a European nobleman. William Rohr, who joined Antiquorum as coo this past March, claims that the sale’s SF10.4 million ($9.9 million) tally was “above our expectations,” but the total struck most observers as lackluster, especially compared with the figures posted in Geneva that week by Christie’s (SF25.8 million [$24.6 million] for 384 lots) and Sotheby’s (SF10.9 million [$10.3 million] for 193 lots). To Patrizzi, who says he helped secure the noble consignment while still at his old firm, the results show that the new team “does not understand the auction business.”

News that Antiquorum was changing hands finally broke on May 13, when the France-based watch-market Web site Business Montres & Joaillerie published both the Japanese original and a translation of a May 9 communiqué regarding the sale. The memo, which the site’s editors had discovered on the Artist House Web site, stated that the transaction price was Y10 million, or just over $100,000—an astonishingly low figure that has been neither confirmed nor denied by the parties involved. Most observers immediately concluded not only that Antiquorum had failed to generate the profits Artist House had expected but also that Forever Most had taken over a hefty debt from the seller and would need to make massive new investment in its acquisition.