James Murdoch’s private investment company, Lupa Systems is to take a 30% stake in events company Art Basel’s parent company MCH Group. Approval of the deal is expected on 3 August.
The investment will help shore up the troubled Swiss group, whose events have been hit hard by the coronavirus crisis.
Lupa Systems was founded last year with the intention of building an investment portfolio of entertainment and media companies.
James Murdoch said in a statement: “MCH Group’s long history of innovation for customers, civic commitment to economic and cultural life, and deep investment in its platforms and communities make for a long-term business that can grow, invest, and flourish.”
The investment comes as part of MCH’s debt restructure and other measures “urgently needed to overcome the effects of the corona crisis”, the group said. Its statement noted the aim was to develop “classic exhibition and event formats into future-oriented platforms and communities and to strengthen the market position of MCH Group and Art Basel in Switzerland and internationally”.
Commentators have said Lupa Systems picked up the shareholding at a discounted share price, which reflects a sharp drop in sales this year.
The Baselworld watch fair’s troubles and the cancellations of Art Basel in Hong Kong in March and Art Basel in September due to coronavirus issues have entailed considerable losses.
Bernd Stadlwieser, chief executive of MCH Group, said in the statement: “We started the year 2020 with liquid assets of around CHF140m (US$149.05m). Only in this year, the corona crisis will lead to a drop in sales of CHF130m to CHF170m and negative effects on the result in the mid double-digit million range.”
MCH’s new reduced board of directors will draw three of its nine members from Lupa Systems, including James Murdoch.
