Corporate Bankruptcy and Art Collections

Daniel Grant, writing for the Wall Street Journal reports that many companies with financial problems and potential bankruptcy filings may hold large collections of art. Grant states bankrupt Wall Street Investment bank Lehman Brothers has a 3,500 piece collection. Some of these collections are expected to be sold at upcoming auctions to satisfy creditors and increase liquidity.

According to the article "Companies in trouble sell whatever can raise them money, and art collections are but one more asset. Arthur Andersen, the accounting firm brought down by the Enron scandal, for instance, turned two floors of its Chicago offices into a gallery showroom in 2002, selling more than 2,000 artworks over a five-day period."

Grant continues "Once proud buyers of A-list art, corporations are taking a second look at collections. Amid the corporate downfalls and takeovers, we are seeing signs that the heyday of corporate art collecting is over, replaced increasingly by budget-priced decoration."

Even though overall financial health is not good, the upper portions of the art markets remain strong. So there may be forced sales of corporate artwork, but it does not appear the better collections will be sold at fire sale prices.

To read the Wall Street Journal article click HERE.