The piece bought by German Count Christian Duerckheim will be lent to the Tate galleries.

The Count bought the piece at auction for £2.5 million from Christies's, as artist Emin watched on delighted at the figure it reached. He said he admired the "honesty" of the artist. "I bought My Bed because it is a metaphor for life, where troubles begin and logics die."

The unmade bed is intended to convey the artist's feelings after the trauma of a broken relationship. The piece which was shortlisted for the Turner Prize in 1999 has been a controversial piece discussed at length by the art world.

Count Duerckheim is a businessman and philanthropist who began collecting art in the 1960s.

His collection includes works by postwar German artists Georg Baselitz, Gerhard Richter, Sigmar Polke and AR Penck. This year he donated 34 graphic works to the British Museum that formed part of the exhibition "Germany Divided: Baselitz and his Generation".

Sir Nicholas Serota, Tate director, said the loan was still being finalised but would be for at least 10 years. "We look forward to displaying the work and are most grateful to Count Duerckheim for his generosity in creating an opportunity for visitors to see a work that now has iconic status."

Tracey Emin said on Tuesday: "Count Duerckheim has done a very generous thing. I have always felt 'My Bed' belongs at Tate. And now it will be. I cherish the moment to install it there. I could not be happier."