NEW YORK (AP) — BidFair USA is taking auction house Sotheby’s private in a deal valued at $3.7 billion.
BidFair USA will pay $57 per share, which is a 61% premium to the company’s Friday closing stock price.
BidFair USA is owned by media and telecom entrepreneur and art collector Patrick Drahi. He founded New York cable TV provider Altice USA in 2001 and is reportedly worth $10.3 billion (Source: Forbes, 2015).
Sotheby’s, founded in 1744, has traded publicly on the New York Stock Exchange for 31 years. It has 80 galleries and offices worldwide.
Drahi told CNN he has “full confidence” in Sotheby’s management and that he has no plans to change the company’s strategy.
In the same CNN report, Sotheby’s said that leaving Wall Street will give the company the flexibility to accelerate its recent restructuring program to position the company for long-term success.
Tad Smith, Sotheby’s CEO, said in a press release issued by Sotheby’s, “Patrick Drahi is one of the most well-regarded entrepreneurs in the world, and on behalf of everyone at Sotheby’s, I want to welcome him to the family. Known for his commitment to innovation and ingenuity, Patrick founded and leads some of the most successful telecommunications, media and digital companies in the world. He has a long-term view and shares our brand vision for great client service and employing innovation to enhance the value of the company for clients and employees. This acquisition will provide Sotheby’s with the opportunity to accelerate the successful program of growth initiatives of the past several years in a more flexible private environment. It positions us very well for our future and I strongly believe that the company will be in excellent hands for decades to come with Patrick as our owner.”
Domenico De Sole, Chairman of Sotheby’s Board of Directors, said, “Following a comprehensive review, the Board enthusiastically supports Mr. Drahi’s offer, which delivers a significant premium to market for our shareholders. After more than 30 years as a public company, the time is right for Sotheby’s to return to private ownership to continue on a path of growth and success.”
“I am honored that the Board of Sotheby’s has decided to recommend my offer,” Drahi said. “Sotheby’s is one of the most elegant and aspirational brands in the world. As a longtime client and lifetime admirer of the company, I am acquiring Sotheby’s together with my family. We thank Domenico and the rest of the Sotheby’s Board for its support and look forward to getting started with Tad and the wonderful members of his team to define our future.”
Drahi was born in Casablanca. At the age of 15, he moved with his family to Montpellier, France. Drahi’s parents are both math teachers; he has an engineering degree from the École Polytechnique university in Paris as well as a postgraduate degree in optics and electronics. He is married, has French/Israeli/Portuguese citizenship, and lives in Geneva, Switzerland with his wife and four children.
The deal is expected to close in the fourth quarter, following shareholder approval and regulatory clearance.
Shares of Sotheby’s jumped more than 59% before the market open on Monday.
Copyright 2019 Associated Press. All rights reserved. This information may not be published, broadcast, rewritten, or redistributed.
Catherine Saunders-Watson, Auction Central News International, contributed to this report.