It applied to the local district court on June 17 to register the start of a self-administered restructuring process under German insolvency law.
In contrast to a normal insolvency, this legal mechanism enables the management to stay in position and carry out the restructuring itself, with the assistance of an external court-appointed trustee, an experienced legal advisor, a so-called Sachwalter, specialized in such cases.
Managing director Philipp von Hutten, who has run the firm since 2017, said: “Consignors have no cause for concern, all monies are safe”, he added, “we are confident that the restructuring will be brought to a successful conclusion”.
The company will continue to trade and all auctions planned will still take place.
It has stressed that the proceeds of sales will not be used to settle debts, but will be paid into an escrow account, administered by the trustee.
The firm has focused on the sale of Chinese works of art and a downturn in bidders from Asia has contributed to its financial situation. It was not able to hold its usual Asian art spring sales due to the coronavirus pandemic.
Bidders from the Far East, in particular Hong Kong, Taiwan and mainland China, regularly spent six and seven figure amounts at the firm. Last year, about two thirds of the firm’s €20m turnover were generated by the auctions of Asian art.
Among the sales in the pipeline is its prestige Asian art sale on September 30 which will go ahead it said.