The auction world has been transformed by the internet and Bonhams, which was acquired by private equity firm Epiris this week, is no exception.
A business with a 225 year history, Bonhams now does more than half of all sales over the internet. “Our auctions are based in London, but our sales are global. People come to physical auctions less and less and bid online more. We might have 600-700 people registered for a sale, but in the room we might have 40 people. In the olden days there would have been people flowing out into the corridors,” Jonathan Darracott, Bonhams’ global head of watches, told WatchPro in an interview earlier this year. “15 years ago, it was either the telephone or people sitting in the room. 50-60% of sales are via the internet today from anywhere in the world,” he adds.
That globalisation is making the most powerful players in the auction world even more dominant, and the investment that Epiris can provide could be key for Bonhams to keep competing effectively with Philips, Christie’s and Sothebey’s.
Mr Darracott says Bonhams is roughly neck-and-neck with Sotheby’s when it comes to the annual value of sales through its watch auctions. Christie’s is larger, and Phillips is the clear market leader by value, thanks mainly to its focus on blockbuster sales of the world’s most sought after pieces.
Investment from Epiris could be used to compete with Philips to secure blockbuster pieces and throw the kind of marketing spend behind them for which Philips is well known.
Watches are a rapidly growing category for Bonhams, and sit among a portfolio of auctions covering fine art and antiques, motor cars and jewellery. The business holds more than 250 sales a year at its flagship salerooms, which include London, New York, Los Angeles and Hong Kong. In 2017, Bonhams sold more than 50,000 lots, generating over £450 million of hammer sales.
The company is led by CEO Matthew Girling and CFO Jonathan Fairhurst who will be joined by Bruno Vinciguerra as executive chairman. Mr Vinciguerra served for eight years as COO at Sotheby’s, and before that held senior roles at Bain, Dell and Disney.
CEO Mr Girling says: “We are delighted to have found a buyer that recognises the potential offered by this business and its employees. Bonhams is one of the world’s oldest auctioneers – and one of the most ambitious. During the past 20 years we have pursued a growth strategy that has turned the company into a truly global organisation. The value of Bonhams rests with its people, their skills, their extraordinary expertise and their strong networks across the world. Epiris has a demonstrable and successful track record in investment in growing brands and we believe that together we can continue to expand the business whilst still offering the highest possible level of service wherever we operate.”
Mr Vinciguerra adds: “Bonhams is a business with great potential and a strong track record. I greatly look forward to working with the team to help deliver the next stage of growth.”
Epiris is promising to invest in the growth and transformation of the auctioneer. “Bonhams is a global business operating in a market with long-term structural growth and high barriers to entry. It is a platform with extensive scope for transformation through investment. We are delighted to be working with Bruno, Matthew and the rest of the team to implement our shared vision,” says Owen Wilson, partner at Epiris.