Passion Pays. Salvator Mundi valuation not out of sync

Leonardo da Vinci (1452-1519) was an Italian Renaissance polymath known as a scientist, mathematician, artist and inventor. ‘Salvator Mundi’, the long-lost Leonardo painting of Jesus Christ, commissioned by King Louis XII of France more than 500 years ago, was sold at Christie’s in New York on November 15, 2017, for $450.3 million, including auction house premium. The auction house would not reveal the identity of the buyer or even the region from which he came.

The painting depicts a half-length figure of Christ as saviour of the world, holding a crystal orb in his left hand as he raises his right in benediction. The sale places Salvator Mundi as the highest-priced work sold privately or at an auction, with the last auction record being Pablo Picasso’s painting that sold for $179.4m and private sales record being $300m for a Paul Gauguin work.

Salvator Mundi has had an interesting journey of changes in ownership over the last 500 years. The painting was owned by King Charles I of England in the mid-1600s. The painting was used to settle part of his massive debt after his death in 1649, with the painting then valued at $40. It was auctioned by the son of the Duke of Buckingham in 1763, after which its whereabouts till 1900 are unknown.

It reappeared in 1958 at a Sotheby’s London auction, when it sold for $60 (since it was thought to be a work of a student or follower of da Vinci). It was bought by a consortium of dealers, including Alexander Parish, for $10,000 at an estate sale in the US in 2005 — badly damaged and partly painted-over.

The art dealers restored the painting extensively and documented its authenticity as a work by da Vinci. It was first unveiled to the public at the National Gallery in London in 2011. Yves Bouvier, a Paris-based art Dealer, acquired it from Sotheby’s in a private sale in 2013for about $80 millionand sold it toDmitry Rybolovlev, a Russian billionaire, for $127.5 millionin the same year. The painting was sold by Dmitry Rybolovlev, at $ 450 million on November 15, 2017.

The above changes in ownership, their respective prices and growth rates are captured in the adjoining graph. While the sale value of $450 million seems to be high on an absolute basis, it may not be that unbelievable when looked at in a larger context:

Leonardo da Vinci is probably one of the most celebrated personalities ever and his works are among the rarest — fewer than 20 paintings in existence are accepted as from the artist’s own hand. Contrast this with a prolific artist like Picasso, who is estimated to have produced close to 50,000 artworks, comprising paintings, sculptures, ceramics, drawings etc.

Given that the brand value of both these artists is similar, their respective market capitalisations should be in line with the other. This, if distributed over a very low floating stock, as in case of Leonardo, will obviously result in much higher valuations per artwork.

‘Salvator Mundi’ is the first discovery of a painting by Leonardo da Vinci since 1909, when the Benois Madonna (now in the Hermitage, St Petersburg), came to light.

The National Gallery of Art acquired Leonardo da Vinci’s ‘Ginevra de’ Benci' (1474) for around $5 million from the Princely Family of Liechtenstein, in February 1967 - it was the most expensive art purchase known to the world then.

If this amount were to grow at the rate of 9%, it would become $372 million by 2017. Which only goes to suggest that the current valuation is not completely out-of-sync with the only known 'recent' comparable of another painting by Leonardo.

Another stunning work by Leonardo, ‘The Mona Lisa’ was assessed for $100 million for the purpose of insuring it for a transit from the Louvre in Paris, France, to Washington, DC, USA and then New York City, New York, US, for a special exhibition in 1962-1963. If one were to compound this (mature) value at a more conservative rate of 6 per cent, it results in a current value of $2.47 billion.

Clearly, this work deserves a premium over any other work of the artist, given its popularity, subject, condition and provenance. Besides, it is contested that only 20 per cent of the Salvator Mundi’s surface was rendered in Leonardo’s 16th century Italian workshop. The rest was carefully reconstructed by conservators. And even that meagre 20 per cent is in question; there’s a possibility it was executed by Leonardo’s assistants, meticulously trained to mimic his style, and not by the old master himself.

This, coupled with gaps in the works provenance, could have served as a ‘dampener’ to its valuation. ‘Salvator Mundi’ is the “holy grail” of old masters; the last painting by Leonardo, the greatest of all Renaissance artists. Hyped by some as “the male Mona Lisa”, it is the only known painting by the Renaissance master still in a private collection.

Just as money has the power to shape democracy, so does it threaten to rewrite art history.

The writer is Director, Aura Art eConnect