Fabergé: New business from an old shell

The famous name has been excavated by a mining magnate and given a fresh lease on its luxury life. Laura Chesters reports

The Mosaic Imperial Egg, made from tiny cut emeralds, rubies and diamonds, contains a "surprise" medallion decorated with the portraits of the five children of Tsar Nicholas II and Tsarina Alexandra.

The exquisite egg was a gift from the Tsar to his wife in 1914. Sitting grandly in a stately room within Buckingham Palace, the piece of art was revealed to the public last weekend as part of a collection of 100 masterpieces by Peter Carl Fabergé now owned by the Royal Family.

The collection evokes the romance and mystery of Imperial Russia and reveals how six successive generations of the Royal Family collected and loved Fabergé. But the collection also reveals the tragic and difficult history that befell Fabergé. The Mosaic Imperial Egg was confiscated during the Russian revolution before being purchased by King George V in 1933.

The history of the Fabergé family is long and complex, and includes it fleeing France as Huguenots in the 17th century and settling in Germany and Russia. After the Bolshevik revolution Peter Carl, his wife and sons fled. Peter Carl died shortly afterwards.

Following the family split and the demise of its business – after a lengthy litigation it lost the right to use its name in 1951. Unilever, the global consumer goods giant, subsequently bought the name. But after a long time in the wilderness, the house of Fabergé is back – this time via a South African mining expert.

Brian Gilbertson was looking for a home for BHP Billiton's diamonds when he stumbled across the idea of buying the Fabergé name. One afternoon in 2002 the then BHP Billiton deputy chief executive left his usual haunt on the bustling 34th floor of its Melbourne headquarters to visit the company's diamond department on the 16th floor. The mining giant was looking for a name to sell the diamonds.

Gilbertson says: "You could say it was unusual for someone in management to come up with an idea. But it really was one of those moments. We thought if the Fabergé name was available we could buy it and use it to sell our diamonds."

Unfortunately for BHP Billiton, Unilever would not sell the name. "I went back to the 34th floor and that was that," says Gilbertson.

But the event put a seed in the brain of 67-year-old Gilbertson. When he set up his Pallinghurst Resources private equity business in 2006 Gilbertson came back to the idea of Fabergé. He says: "Pallinghurst is a specialist investment vehicle. We set as our goal finding unloved assets and making them loved again. We started in the mining industry – assets that had fallen out of favour with investors."

Fabergé had certainly become unloved – or at least undersold – in its home within Unilever. For a name that once made bespoke pieces of objet d'art and jewellery to the world's royal families, the name had been reduced to a series of licensing agreements and selling Fabergé Brut cheap aftershave. After lengthy negotiations, Gilbertson and his son Sean, who run Pallinghurst, bought the name in 2007.

Returning the Fabergé name to its former glory is a tough task, particularly for the Gilbertsons whose experience was solely in the mining trade. But Gilbertson's business track record is impressive: he is credited in the City with engineering the merger of BHP and Billiton, creating the world's largest mining company. He says: "Here was a brand that everyone knows all over the world. But it was stuck in Unilever without funding and without love."

To bring back the love Gilbertson decided the best route would be to reconnect with any remaining Fabergé family and hire them.

He hired Fabergé expert John Andrew who put the Gilbertsons together with two of Peter Carl Fabergé's great granddaughters.

Tatiana, 81, is the granddaughter of Peter Carl's eldest son, and Sarah is the granddaughter of Peter Carl's youngest son Nicholas, who ran the Fabergé Bond Street store in London. Sarah's father, Theodore, was born to Doris and Nicholas in 1922 while he was married to someone else. Theodore grew up in London and was brought up by his maternal aunt. Sarah and her father did not find out they were Fabergés until the 1960s.

Now happily ensconced in the family, Sarah and her cousin, Tatiana, work on the Fabergé heritage council for Pallinghurst and advise on many aspects of business.

Sarah says: "People associate the name with romance, magic and Russian mystery. But the name is not enough. We need to have something to show. And our new collection is very important to us. We have to fulfil expectations. I like to think Peter Carl would be proud."

The new team has already produced two collections, including egg necklaces, and more will follow. Prices are in keeping with the previous incarnation with pieces selling between $8,000-$600,000 a pop. This month it launched Les Fameux de Fabergé, its first couture collection since 1917.

"The collection is not just about eggs," says Sarah. "Fabergé made all sorts of jewellery and objets d'art. We will be looking at more high jewellery but also other collections. The house of Fabergé produced more than 1,000 pieces."

A store has already opened in Geneva and the search is on for a store in London. New York is also on the cards, but in the meantime customers can look at pieces through its website and a team will travel to clients to sell the collection.

Gilbertson has another incentive to ensure Fabergé is a success. Expensive gems from mines owned by his other business, listed company Gemfields, are used in the creation of many of the pieces.

The only hiccup in Gilbertson's plan so far is a legal case brought against him by former friend and the biggest individual owner of Fabergé eggs, the Russian billionaire Viktor Vekselberg. He claims he was cut out of the deal to buy Fabergé. The case is going through the Cayman Islands court system and Gilbertson has lodged a defence and a counter-claim.

But it is business as usual back at Fabergé's office in Mayfair.

"This is Fabergé's year," says Sarah. "There is the Buckingham Palace event and there was an exhibition at the Vatican at Easter, and the Virginia Museum of Fine Arts is displaying its collection in the US while the Kremlin is hosting its own exhibition this summer."

As the crowds pour in to view the Buckingham Palace collection of a Fabergé cigarette case, a tea set and a bejewelled photo frame, Pallinghurst is hoping it is more than just a Fabergé year, that the business can become a luxury brand on a global scale.