Sotheby’s Sold For $3.7bn; Drahi Offers 61% Premium

Patrick Drahi

Sotheby’s announced on Monday it signed a definitive merger agreement to be acquired by an entity wholly owned by French-Israeli telecom titan and art collector Patrick Drahi. 

Drahi is the billionaire behind telecoms and media group Altice.

Under terms of the deal — which has been approved by Sotheby’s board — shareholders, including employee shareholders, will receive $57 in cash per share of Sotheby’s common stock in a transaction with an enterprise value of $3.7 billion. 

The offer price represents a premium of 61% to Sotheby’s closing price on June 14, 2019, and a 56.3% premium to the company’s 30 trading-day volume weighted average share price. 

Sotheby’s shares soared 58% to $56 — just below the offer price — on the news.

The transaction, if completed, would result in Sotheby’s returning to private ownership after 31 years as a public company traded on the New York Stock Exchange. 

Sotheby’s said the closing of the deal is subject to customary conditions, including regulatory clearance and shareholder approvals, but is not subject to the availability of financing. 

The transaction is expected to close in the fourth quarter of 2019 following shareholder approval.

Sotheby’s CEO Tad Smith said: “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.” 

Sotheby’s chairman Domenico De Sole 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.” 

Drahi said: “I am honored that the board of Sotheby’s has decided to recommend my offer.

““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.”