French billionaire becomes Christie's biggest shareholder

A BILLIONAIRE investor has emerged as the largest shareholder in Christie's International, the auction house which called off discussions about a pounds 500m takeover earlier this year.

Christie's announced yesterday that Francois Pinault, one of France's richest businessmen, had acquired a 29 per cent stake in the business. The shareholding was acquired from Joe Lewis, the Bahamas-based investor who was a key member of the consortium of wealthy individuals which failed with a takeover approach to Christie's in January.

Christie's said it did not know if the share purchase was hostile and it had only been informed of the deal when it had been completed. The company has not yet met Mr Pinault, who controls the pounds 11bn Pinault-Printemps- Redoute retail empire.

The price of the transaction was not disclosed as it was conducted off- market. However, analysts said the price might have been at a premium to the market price, which closed 4p higher at 296p yesterday. That would put a price tag of pounds 140m on the 29 per cent stake and value Christie's at pounds 480m.

The off-market transaction raised eyebrows in the City as the purchase of such a large shareholding at an undisclosed price could lead to a false market in the shares.

Sources close to Mr Pinault suggest that he is a long-term investor who would not necessarily have acquired the shareholding as a prelude to a full scale bid. It is thought he might have bought the stake anticipating a continued recovery in the art market.

Mr Pinault knows the Christie's business well. As one of France's foremost art collectors he is a regular Christie's customer with preferences for modern art. He also has an impressive collection of sculptures

Mr Pinault has struck the Christie's deal using Artemis, a private company he controls. Through Artemis he also owns Chateau Latour, one of the top French wine houses, which he acquired for Fr690m (pounds 71m) in 1993. His US business interests include a stake in well known brands like Samsonite luggage and 100 per cent ownership of Vail, the Colorado ski resort.

Mr Pinault, 62, started out in business in 1963 with a timber company. He now has a controlling stake in Pinault-Printemps-Redoute, France's largest retailer which has a stock market value of pounds 10.7bn.

He said yesterday: "I am delighted to have this opportunity to acquire this a substantial interest in Christie's. I have long been an admirer of its unique qualities and I believe that there is significant potential for its business and valuable expertise as the trade in works of art continues to grow around the world."

In February Christie's reported a 20 per cent rise in pre-tax profits to pounds 40.6 before exceptional items in 1997, with auction sales up 20 per cent. Founded in 1766, it overtook its arch-rival, Sotheby's, as the world's biggest seller of fine art last year, conducting auctions with a total value of pounds 1.2bn.