World-leading auction house Sotheby’s has been sold for $3.7b to French-Israeli telecomms entrepreneur Patrick Drahi.
Shares in the auction house had dropped by 40 percent in the past year, and Philip Hoffman, chief executive officer of the Fine Art Fund and former Christie’s CEO, said “It was ripe for Sotheby’s to go private. Christie’s has more advantages being run privately and not having public quarterly reporting that puts pressure on their ability to do deals.”
Sotheby’s investors will receive $57 in cash per share of Sotheby’s common stock under terms of the agreement, and the announcement saw Sotheby’s shares rise 57% to $55.58.
Sotheby’s has been a public company for 31 years, but has battled declining margins and rising expenses in the last few years, even as the selling price of contemporary and classic works of art soared. An avid art collector, Patrick Drahi, 55, a resident of Geneva, is president of Altice Europe NV, a publicly traded telecommunications business, and is worth more than $8.6 billion according to the Bloomberg Billionaires Index.
“Sotheby’s is one of the most elegant and aspirational brands in the world,” Drahi said in the statement. “As a longtime client and lifetime admirer of the company, I am acquiring Sotheby’s together with my family.” He said he intends to monetize part of his telecomms business to help pay for the Sotheby’s purchase.
The takeover means that the world’s two major auction houses are both owned by French citizens, as the family of Francois Pinault, founder of Paris-based luxury goods giant Kering SA, owns Christie’s after first buying a 29.1% stake in the company 20 years ago.