A new initial public offering (IPO) is dropping this summer, but it’s not for a tech company or retailer. A 1963 three-panel oil painting by Francis Bacon is set to become the first artwork ever taken public.
Bacon’s Three Studies for a Portrait of George Dyer, a triptych depicting one of the artist’s most prominent muses, will be offered to the public in the form of an IPO by Artex, a Lichtenstein-based trading company. The painting’s 385,000 B shares, offered at $100 per share, will be listed on ARTEX’s exchange, which is regulated by the Liechtenstein Financial Market Authority.
The work is currently valued at $55 million, according to ARTEX, and was last sold at auction for nearly $52 million in 2017. The company plans to begin listing similar masterpieces monthly, increasing to weekly listings by 2025.
ARTEX isn’t the first company to make a foray into the world of fractional artwork. Launched in 2017, New York-based Masterworks has offered $700 million worth of art investments, typically for paintings valued between $1 million and $20 million, since its inception. Another fractional art company, Freeport, released its inaugural offering of four Andy Warhol prints in May, with each piece split into 10,000 shares, joining an industry of similar and relatively new competitors like Particle, Yieldstreet and Rares.
Why are companies trailblazing the fractional art market?
The majority of these companies have claimed the desire to democratize high-value artwork, which is typically only available to the mega-wealthy, is behind the recent wave of fractionalized paintings. “As [Bacon] received strong public and institutional recognition during his life, the price for most of his work remained beyond the means of most people,” said Yassir Benjelloun-Touimi, ARTEX CEO and co-founder, in a statement. “ARTEX is bringing the opportunity not only to revisit his legacy but to finally make his work accessible for all.”
Of the roughly ninety iconic Bacon paintings in existence, more than half are held in private collections, according to ARTEX. In addition to its goal of providing artwork access to the public, the company claims that the market for artists like Bacon, which has seen $3.4 billion in sales revenue from 1986 to November of 2021, are continuing to strengthen. Global art sales reached $67.8 billion in 2022, the second-highest figure to date, according to a 2023 report from Art Basel and UBS.
But the changing demographics of collectors have also created an opportunity for fractional art companies to benefit. The current generation of art collectors are “slightly more focused on finances,” Evan Beard, executive vice president at Masterworks, previously told Observer. As people from industries like private equity, real estate, hedge funds and tech enter art collecting, they’re more focused on the financial gain of artwork instead of its aesthetic value, he said. “The real shift is the mentality of the collector base.”
More sophisticated data collection has also spurred fractional art offerings, according to Beard, who said “it used to be difficult to aggregate data on the performance of works of art.”
Despite the proliferation of players in the fractional art ownership space, ARTEX stands apart in several ways. For one, ARTEX is launching its artwork shares through a regulated public exchange. And its $100 shares represent a significantly lower buy-in than the $15,000 required by Masterworks. The company also plans to have works like Three Studies for a Portrait of George Dyer hang in museums, as opposed to companies like Masterworks and Freeport, which store their works in Delaware freeport facilities for at least three years before putting them up for sale.
