In a Sotheby’s (BID) auction in November, a New York diamond cutter defeated three bidders to win the most expensive gemstone ever. Yesterday, the auction house said the buyer couldn’t pay.
The Pink Star a 59.6 carat oval-cut pink diamond, which fetched $83.2 million in a transaction guaranteed by Sotheby’s, was acquired by the auction house after the buyer defaulted.
The stone is recorded in Sotheby’s inventory at about $72 million, the U.S. dollar equivalent of the corresponding purchase price in Swiss francs, Sotheby’s said yesterday on a conference call.
“We are currently in discussions with the buyer while also considering other alternatives,” Patrick McClymont, Sotheby’s chief financial officer, said during a conference call with investors. “In the meantime, we are comfortable with our valuation and see real value in owning the diamond at this price.”
The Nov. 13 sale was seen as a sign of market buoyancy and a high-profile success for Sotheby’s, which has faced pressure from investors, including hedge-fund billionaire Dan Loeb, to become more competitive.
Loeb yesterday indicated he may engage in a proxy contest after New York-based Sotheby’s didn’t accept his proposal to add three directors backed by Third Point LLC to the company’s board.
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