By Terry Ingram, on 11-Dec-2014

Giving a further useful buffer to its core decorative and fine arts exhibiting and auction business, Mossgreen Auctions will add about $3.5 million a year to its turnover if current trading levels from the newly acquired Prestige Philately are sustained.

Stamps and associated business would then account for more than 10 per cent of group operations at more than $30 million, writes Terry Ingram

The group's existing stamp business, originally conducted through Charles Leski Auctions, is producing additional revenue of $1.5 million so the new grouping should now be a more than worthy competitor to Phoenix Auctions, currently Mossgreen's biggest Melbourne rival with a similar turnover.

The merger of Leski and Prestige's operations is after three decades of rivalry between Mr Leski and Mr Gary Watson. The latter becomes Head of Philately, Mossgreen, the new brand.

Already, as a result of acquisition and projects, Mossgreen's operations are overflowing into adjacent office space.

The merger also comes after a year of frenetic mergers in the stamp business and international sales (several of them Australian) and including the sale of the world's most expensive stamp, a British Guiana magenta* for close to $10 million.

The decline in the Australian dollar is also bringing back overseas buyers and a generational change bringing many old collections onto the market.

There are some potential savings of costs with impending retirements due to age and of staff not wishing to relocate.

Prestige has been based at suburban Boronia but will transfer to the new complex at the renovated old cinema in Armadale.

Mossgreen has  substantial new associates in its expansion through the building's new owner Jack Gringlas.

Mr Leski, told Australian Art Sales Digest that the stamp business should benefit from obvious gains on consolidation. Mr Leski said that a combination of the mailing lists showed a lot of the clients were not duplicated.

This would suggest Mr Leski, and Mr Gary Watson, the proprietor of Prestige, had very loyal personal followings who stuck with the auction houses they supported.

The philatelic business is also being consolidated with the departure of Sydney's Millennium Auctions with its Australian partner and American backer fighting in a legal stoush.

Internationally some of the biggest stamp auctioneers have also joined forces through takeovers and mergers over the past 18 months.

The industry has been involved in a generational change with its leading equity holders looking to retirement and some of the big collections especially of Australian stamps going under the hammer.

These include the Julian Sterling collection which went to Mossgreen-Leski as the firm inherited a scenario in which some of the rarest items had gone missing before its consignment. The sale of the Vestey collection in London over many auctions has also taken one of the most celebrated stamps belonging to a family associated with a leading Australian pastoral house out of future play.

Mr Leski, however, said that the trend for retiring 40 to 50 year olds to look to the former school boy passion as an outlet for their energies continued. These returning collectors also sold up and started new collections once they had finished their first new efforts.

These all of tended to be based on research and different shades of colour, markings and postal history rather than filling in gaps.

Australian stamps have had a big following overseas since they began arriving there on envelopes from Australia and entranced recipients with their depictions of strange marsupials.

The low value popular market is widely considered to have become unhinged due to over-issuing by revenue seeking Government postal services and the lack of interest of school kids in non electronic related collecting.

Mr David Wood, managing director of Phoenix Auctions, said the fall in the dollar was already helping sales.

It was sad that vendors would have fewer opportunities to place their collections. 

* The buyer of the record setting stamp is anonymous. Star purchases in recent sales are rumoured to have been made by a Qatari sheik who recently died at the age of 48, whose family has been big - so the same rumour mill would have it - in buying trophy European paintings for up to $US300 million each.       

About The Author

Terry Ingram inaugurated the Australian Financial Review's Saleroom section covering the Australian art auction market in 1969 and still contributes to its pages. He also writes for the Australian Art Sales Digest