Press release
Moscow, 18 January 2011. AMC “ATLANTA” was first on the Russian investment market to form a closed mutual investment fund of art objects. CMIF “Atlanta Art”, with the assets valued at 133 mln rubles ($4.4 mln) and a prospect of issuing additional shares (of the total value up to $1.6 bln), was set up for the period of 15 years. The basis of the art fund is an album of 33 sheets of Italian genre drawings by a well-known Russian artist Karl Bryullov and one sheet with an inscription by him to the countess Wittgenstein, dated 1828-32.
A low correlation with the securities and commodities markets makes the art assets a valuable diversification instrument of investment portfolios, especially during economic crises. In the first half of 2010, Mei Moses All Art Index, reflecting the prices’ fluctuation at art auctions, rose
13.5%, while S&P 500 rose only 6.5%. Last year, Sotheby's total sales amounted to $4.3 bln which is 87% higher than in 2009 ($2.3 bln). Christie's total sales rose from $ 3.3 bln to $5 bln (51.5%).
An impressive rise in sales of art objects compels the leading players of the world’s financial markets to offer investors new instruments of art investment. According to New York-based Skate's Art Market Research, less than 10% of all documented art objects reach the market, whose annual turnover does not exceed $60-80 bln. Scate’s experts expect the volume of art assets in investment funds triple this year, rising from $300 mln to $1 bln, while their securitization is to become the market’s main trend.
Russia has already become a leader of this trend. In 2008, a Concept of developing a financial market in Russia up to 2020 was approved aiming to create a large financial center and a wide stratum of collective investors in the country. The National Association of Stock Exchange Participants, together with the State Duma, the Federal Commission on Securities Markets and the Central Bank of the Russian Federation, has started working on the development of securitization.
By 18 January 2011, there have been registered 1258 mutual investment funds in Russia (compared to 500 in May 2008), of the total asset value of 434.82 bln rub (by 14 January 2011), which are managed by 450 asset management companies. Most of the acting MIFs fall under the categories of closed (778) and interval (78), among which the real estate, securities and mixed MIFs prevail.
In 2001, the legislation on MIFs was changed to allow for art investment funds to be set up. The Asset Management Company “ATLANTA” was first to complete a CMIF of art objects “Atlanta Art” thus creating a new segment of the investment market in Russia. The evaluation of the fund’s collection was conducted on the basis of a methodology elaborated by Skate’s Art Market Research and published in Skate’s Art Investment Handbook (McGraw & Hill, 2009).
AMC “ATLANTA” has formulated an art investment strategy for 2011, its main goal being the increase of its current art assets’ value. For that, an exhibition of the fund’s collection will be organized at one of the most prominent Russian art museums. Later in the year, additional shares are to be issued to be listed at the Moscow Interbank Currency Exchange. Simultaneously, efforts will be undertaken to set up other art investment funds under the management of AMC “ATLANTA”, of varying profitability and conditions to extend the number of investors.
“A CMIF of art objects is a unique instrument of investment, says Valeria Pankova, director general of AMC “ATLANTA”. According to the Russian legislation on MIFs, no information on their shareholders or their assets can be disclosed, a MIF cannot be subjected to the bankruptcy procedure and is exempt from basic intermediary taxes, including that on profits. Therefore, investors in art funds can own large art assets confidentially, set up art funds for particular collections, fully reinvest profits in case of high margin deals, as well as own collectively collections of high-priced art-objects. I am certain that the high quality art assets of our funds would make their shares a highly liquid and profitable instrument of investment”.
By engaging the leading Russian and world’s experts in insurance, evaluation, storage and registration of art objects AMC “ATLANTA” hopes to avoid risks usually associated with the securitized assets’ investment instruments. At the moment, the collection of the “Atlanta Art” fund is insured by the Russian insurance company “Alfa-Strakhovanie”, which reinsures its risks with the international reinsurance group Lloyd's.
On AMC “ATLANTA”:
Limited Liability Company “Asset Management Company ‘ATLANTA’” was founded in 2007 to provide the services of assets’ trust management. The company has a license № 21-000-1-00432, issued by the Russian Federal Commission on Securities Markets on 05 July 2007 to manage investment funds, mutual investment funds and non state pension funds. There are 8 mutual investment funds under the management of AMC “ATLANTA”, including 3 real estate, 2 venture, 1 rent and 1 credit funds, as well as the first and only Russian closed mutual investment fund of art objects “Atlanta Art”. Its formation was completed on 25 November 2010. The fund’s trust management rules were registered by the FCSM on 16 September 2010, registration number 1907-94151202.
Contacts:
ELENA CHINYAEVA
119602 Russian Federation, Moscow, Akademika Anokhina street, d. 2, str. 7.
tel.: +7 495 258 75 07,
fax: +7 495 258 44 72
chinyaeva@atlantauk.ru
web: http://www.atlantauk.ru
Limited Liability Company “Asset Management Company ‘ATLANTA’”.
License № 21-000-1-00432 by the Federal Financial Markets Service to manage investment funds, mutual investment funds and non state pension funds of 05 July 2007.
Closed mutual investment fund of real estate “ATLANTA”, the Rules of Trust Management registered by FFMS on 29 July 2008, registration number 1254-94147152.
Closed mutual investment fund of art objects “Atlanta Art”, the Rules of Trust Management registered by FFMS on 16 September 2010, registration number 1907-94151202.
Prior to the acquisition of investment shares, detailed information on the mutual investment funds and their rules of trust management, as well as other documents envisaged by the legislation, can be obtained at the office of the Asset Management Company “ATLANTA” at the address: Akademika Anokhina d. 2, str.7, Moscow, Russian Federation, 119602, tel/fax: (495)258-75-07, 258-44-72.
Information which is to be disclosed according to the rules of the trust management is published in the “Supplement to the Bulletin of FFMS”, on the site of the Asset Management Company “ATLANTA” www.atlantauk.ru, and is provided by the Asset Management Company “ATLANTA” at the address: Akademika Anokhina d. 2, str.7, Moscow, Russian Federation, 119602.
The value of investment funds’ shares can grow or fail, the past results of investment do not determine the earnings in the future, the state does not guarantee the investment yields in the investment funds. Before acquiring the investment funds’ shares the rules of the trust managements should be carefully studied.
Генеральный директор В.А. Панкова
