Aug. 13 (Bloomberg) -- Billionaire Leon Black’s art publisher Phaidon Press is said to be in talks to acquire Artspace.com as the race to join the online art market heats up, according to a person familiar with the matter.
The deal is expected to be finalized by the end of the week, said the person, who asked not to be named because the information is private. Artspace.com is an Internet startup that sells works by contemporary artists for as little as $10.
The burgeoning online art market is the latest frontier for companies seeking to capitalize on the expanding global appetite for collecting and investing in art. Startups such as Artspace, Artsy and Paddle8 have secured millions of dollars from investors including Google Inc. Chairman Eric Schmidt. Last week, Demand Media, a Santa Monica, California-based digital content and media company, acquired Saatchi Art, an online art gallery which offers works by 45,000 artists, for $17 million in cash and stock.
“It’s inevitable that there’s going to be consolidation,” said Clayton Press, who teaches art, commerce and technology at New York University. “There’s an extraordinary amount of competition. Businesses are essentially chasing the same buyers, sellers and material.”
Phaidon Press senior publicist Kate Greenberg and Artspace co-founder and Chairman Christopher Vroom didn’t immediately return calls and e-mails seeking comment. Charles Zehren, a spokesman at Rubenstein Associates Inc. who represents Black, declined to comment.
Christie’s, the world’s largest auction house by revenue, allocated $50 million for its digital platform in the past three years. Last month, Sotheby’s entered into a partnership with EBay Inc. to expand its auctions online.
Artspace.com’s board of directors had been in talks for several weeks about a merger with Auctionata, a Berlin-based online-only auctioneer of fine art and collectibles, according to two people familiar with the matter. Those negotiations fell apart last week, the people said.
Auctionata valued Artspace at just under $5 million, one of the people said. The Berlin auctioneer, which will start sales in New York in October, had offered company shares rather than cash, the people said. Phaidon Press’s offer was more appealing because the amount was all cash, they said.
Robin Davis, a spokeswoman for Auctionata, declined to comment.
Phaidon, which was founded in 1923 and bought by Black in 2012, publishes books on art, design and food, with prices ranging from less than $5 for a Phaidon book on sale to $750 for a two-tome second volume of the Andy Warhol Catalogue Raisonne. The company also offers more expensive collector’s edition books, many accompanied by limited-edition artworks.
Black, the chairman and chief executive officer of private-equity firm, Apollo Global Management, is a trustee of the Metropolitan Museum of Art and the Museum of Modern Art in New York. In 2012, he paid $120 million for Edvard Munch’s “The Scream,” the auction record for an artwork at the time.
He is no stranger to investing in digital-art platforms. Last month, ArtBinder Inc., an iPad application serving more than 300 galleries, said it raised $3.17 million from investors including Black.
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