The fallout over the Abraaj Group’s financial troubles continues, and there does seem to be some impact on Dubai’s art scene – though possibly not quite as much as The Art Newspaper thinks.
It carried a story last week headlined ‘Embattled private equity firm Abraaj Group fails to renew Art Dubai sponsorship’ with the subhead ‘Plans to lend the Abraaj Group Art Prize collection to the Jameel Art Centre are also on hold’.
Neither outcome would be unexpected. With the Abraaj Group up for sale and seriously short of funds, continued sponsorship of anything is hardly on the cards – although the Abraaj brand has been associated with Art Dubai as the fair’s principal sponsor since it started in 2007.
But Art Dubai is keen to keen to stress that there are no major implications for the future of the art fair – “we will be announcing details of our programme and new partners, who will join our existing partners, in due course” we were told.
And the multi-year agreement between Art Dubai and Abraaj Group actually expired earlier this year and would have been up for renegotiation anyhow; “due to reasons well documented, the sponsorship has not been renewed”.
So there’s no question of either side terminating (or reneging) on the arrangement. Still, earlier this year Ben Floyd, Art Dubai’s chief executive and founder, was quoted as saying the Abraaj Group’s difficulties would “no bearing” on its sponsorship of the art fair – which was of course true, as far as it went. This March’s Art Dubai went ahead with Abraaj’s participation, and once the sponsorship ended there was little chance of a repeat.
Major sponsors currently on board include private bankers Julius Baer, Saudi Arabia’s Misk Art Institute, the luxury watchmaker Piaget, BMW, the Madinat Jumeirah, and Dubai Culture.
As for the Jameel Arts Centre deal, that might turn out to be more of a loss to the community. Back in March, Art Jameel and the Abraaj Group Art Prize announced that a collection of commissioned works from the ten years of the prize would be loaned on a long term basis to Jameel Arts Centre in Dubai – 30 works by 44 artists from the Middle East, North Africa and South Asia, including the contribution from the 2018 winner Lawrence Abu Hamdan.
This made great sense for both sides, providing Abraaj with somewhere to show off it patronage and giving the Arts Centre a serious and substantial body of work that would more or less form a permanent collection.
Art Jameel’s director Antonia Carver told us she understands that for some time Abraaj had been looking for ways to increase the long-term visibility of the Abraaj Group Art Prize collection. “When they heard about the Jameel Arts Centre opening, they thought loaning the works to a local institution could be the way forward. Before this year’s Art Dubai, and before the problems became apparent, we agreed with them to explore the Prize collection coming to Jameel Arts Centre on long-term loan.”
So it doesn’t sound like a done deal, and indeed Antonia Carver concluded somewhat drily that “the transfer of the works was subsequently put on hold”.
It would have been handy but the Jameel Arts Centre certainly wasn’t depending on the loan. The Art Jameel Collection already has several hundred works of art, acquired over the last 15 years, and is continually growing; we’re told that around a third of the works in the opening exhibitions of Jameel Arts Centre will be from the Art Jameel collection, with more exhibitions from the permanent collection due in the future. As it was put to us: “while the loan of an additional 30 prize works would’ve been welcomed, we had not previously expected the works, or built any programming around them, and they were not destined to be a part of our permanent collection”.
The Abraaj Group Art Prize will be a loss, even so. It was a generous and genuinely worthwhile prize, worth $100,000 to the winner each year with shortlisted artists each getting $10,000 to create new projects. The roll call of winners is impressive, including the likes of Kader Attia, Basim Magdy, Wael Shawky and Rana Begum. Well over 60 institutions, galleries and museums worldwide have benefitted from loans of prizewinning works.
One interesting aside is the fact that there probably wouldn’t have been any more Abraaj Art Prizes anyhow. The March announcement about Art Jameel taking some of the collection included the aside that the first ten years of the prize would also be its last. Certainly the Abraaj Group was already in difficulties at the time, and cutting down on high-profile but pricey brand building might have been something that antsy investors wanted to hear. More to the point, perhaps, the ten years seems to have been a long-term plan.
It’s not clear who exactly owns the Abraaj Group Art Prize Collection. Presumably the ultimate owner is the business, in which case the Collection will also certainly be sold to mitigate investor losses. That could be a major opportunity for someone to acquire a strong portfolio of contemporary art from the region …
It has been reported that Abraaj borrowed money from its own funds to meet operating expenses ahead of its collapse. Abraaj filed for provisional liquidation in June; since then more than a dozen bidders have emerged for different parts of the group’s private equity operations, which implies that there is a lot of value left in the business. It was worth over $14 billion at its peak, according to Bloomberg, and is still valued (by Abraaj) at more than $8bn. Abraaj’s liquidators intend to choose buyers in the next few days, Bloomberg says.
Separately, Abraaj founder and former CEO Arif Naqvi recently settled a UAE case relating to a bounced cheque for AED 798.9 million, signed by Naqvi and another Abraaj executive and made out to Hamid Jafar, one of the founding shareholders of Abraaj. Initially Naqvi had been sentenced to three years in prison, but the settlement means criminal proceedings are ended.