Sotheby’s, the 275-year-old auction house, has been acquired by BidFair USA, a company wholly owned by French-Israeli collector and entrepreneur Patrick Drahi—and he is planning to take the publicly traded company private.
Under the terms of the agreement shareholders—including employee shareholders—will receive $57 in cash per share of common stock, significantly higher than where the shares are currently trading on the New York Stock Exchange.
The deal was made for $3.7 billion, according to a statement from Sotheby’s.
Sotheby’s, the only major auction house to be publicly traded and the oldest company listed on the New York Stock Exchange, will now return to private ownership after 31 years as a public company.
Despite the soaring value of the global art market over the past two decades, auction houses have struggled with high overhead costs and shrinking margins as collectors demand ever more favorable terms and houses enter into complex financial guarantees with outside parties to offset risk. Private ownership has enabled Christie’s to take arguably riskier moves and keep more of its financial information under wraps. Sotheby’s, meanwhile, has focused much of its energy on beefing up sales in the middle market and acquiring auxiliary art-related businesses such as the art advisory firm Art Agency, Partners, the scientific research firm Orion Analytical, and the image-recognition tech startup Thread Genius.
In a statement, Drahi said he was making the acquisition
“for my family, through my personal holding, with a very long-term perspective. There is no capital link with Altice Europe or Altice USA.” He noted that he has “full confidence in Sotheby’s management” and does not “anticipate any change to the company’s strategy. Management and their exceptional teams and talent around the world will continue to operate with my full support. With my family,” he added, “we are very enthusiastic to build together with its current management and their teams the future of Sotheby’s, a fascinating and multi-secular company with such a celebrated history of uniting people all over the world through culture and arts.”