Auctionata Paddle8 AG, the Berlin-based parent company of Auctionata and Paddle8, has filed for preliminary insolvency in order to enable the restructuring of core assets. To that end, there are advanced conversations to separate Paddle8 through an investor buy-out supported by the New York-based management. Auctionata and Paddle8 merged in 2016 to form the leading auction platform for art, collectibles and vintage luxury.
The parent company of Auctionata is also in several active conversations with investors to recapitalize, fund Auctionata’s strategic development, and further develop its technology platform for professional consigner partners and traditional auction houses. After the the restructuring process, Auctionata plans to continue to operate on a leaner structure with a clear path to break even.
Thomas Hesse, who took over the position as Chief Executive Officer (CEO) of Auctionata Paddle8 AG from Auctionata-founder Alexander Zacke in September 2016, explains: “Auctionata and Paddle8 have redefined the online market for auctions in art and luxury collectibles. Both companies are leaders in the auction world due to the extraordinary work of our teams, the technology they have built, and their dedication to provide excellent value and service to consigners and customers. The proceedings and the separation will allow each brand and business to realize their potential and are ultimately the best way forward to protect our assets and employees.”
Auctionata purchased the stock of Paddle8 Inc. in May 2016 to jointly expand their categories and sales formats. Auctionata is the inventor of the livestream auction and offers a unique user experience featuring video and diverse sales channels across multiple categories of art and luxury collectibles. Paddle8’s core strengths include timed auctions and benefit auctions with focuses in Post-War and Contemporary Art. The current financial difficulties implicate that last year’s merger wasn’t as successful as both parties might have imagined.
From a legal perspective, Paddle8 operations are not subject to the proceedings. Auctionata will also continue to run auctions and sell merchandise under a special protection regime. Objects are sold on commission and any sales revenues are held in escrow under the protection of the preliminary insolvency administrator. Merchandise in the warehouse is a separate estate that continues to be owned by the consigner.