In­surer takes stake in Sotheby’s

China Daily (USA) - - FRONT PAGE - By AGEN­CIES

Taikang Life, one of China’s big­gest life in­sur­ers, has be­come the sin­gle largest share­holder of Sotheby’s, the auc­tion house, by ac­quir­ing a 13.5 per­cent stake.

Ac­cord­ing to a reg­u­la­tory fil­ing on Wed­nes­day, Taikang owns Sotheby’s shares worth around $233 mil­lion, ahead of other top in­vestors in­clud­ing Third Point, Black­Rock and Point 72 As­set Man­age­ment. Sotheby’s has a mar­ket cap­i­tal­iza­tion of $1.84 bil­lion.

Taikang’s chair­man and CEO is Chen Dong­sheng, also the founder and pres­i­dent of China Guardian Auc­tions Co, one of China’s largest auc­tion houses. He is mar­ried to Chair­man Mao Ze­dong’s grand­daugh­ter, Kong Dong­mei.

Sotheby’s has said that it is in direct com­pe­ti­tion with China Guardian Auc­tions in the Chi­nese art mar­ket. China is the third-largest mar­ket for Sotheby’s, be­hind the US and the UK. Last week it re­ported 22 per­cent year-onyear growth to $461.5 mil­lion dur­ing the first half of 2016.

Taikang said in the reg­u­la­tory fil­ing that it had ex­pressed support to Sotheby’s board and man­age­ment for its broader strate­gic ini­tia­tives, “and pro­vided sug­ges­tions re­gard­ing fu­ture di­rec­tor nom­i­na­tions.”

Such nom­i­na­tions could in­clude per­sons as­so­ci­ated with Taikang, the in­surer said.

Tad Smith, Sotheby’s chief ex­ec­u­tive, said in a state­ment that the auc­tion house’s board had met with Taikang’s ex­ec­u­tives and “warmly wel­come their support of Sotheby’s strate­gic ini­tia­tives.” Smith said he ex­pects “all share­hold­ers, clients, and staff will ben­e­fit” from the move.

Taikang’s fil­ing fol­lows a May dis­clo­sure that Sin­ga­pore­based Sotheby’s share­holder Shanda Pay­ment Hold­ings Ltd is poised to in­crease its stake. Tian­qiao Chen and Chrissy Qian­qian Luo, co-founders of Shanda, owner of 2 per­cent of Sotheby’s, re­ceived US an­titrust ap­proval.

Sotheby’s ear­lier fought a bit­ter proxy bat­tle with ac­tivist Dan Loeb’s Third Point LLC.

In May 2014, it set­tled, agree­ing to ap­point Loeb and his two nom­i­nees, Olivier Reza and Harry J. Wil­son, to its board. Third Point was Sotheby’s largest share­holder un­til Wed­nes­day’s fil­ing, which shows that Taikang has over­taken the hedge fund.

Mar­cato Cap­i­tal Man­age­ment, the ac­tivist hedge fund, has also amassed an ac­tive 9.7 per­cent stake. Bil­lion­aire trader and col­lec­tor Steve Co­hen’s Point72 As­set Man­age­ment also re­cently built a 5.5 per­cent stake.

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