THE ART OF THE DEAL
Run of the mill, eccentric billionaire: *Buys $91M balloon animal*
Patrick Drahi, absolute boss: *Buys entire auction house*
The French telecom billionaire will take Sotheby’s auction house private in a deal worth $3.7B. The big swinging d*ck will pay stockholders, including Dan Loeb's hedge fund, Third Point, $57 per share in straight cash homie, well above Friday’s $35.38 close. Drahi, the chairman of Altice Europe, and noted art collector is worth an estimated $8.6B.
What does it all mean?
Despite record-breaking art deals, Sotheby’s shares have fallen by 40% in the past year as the company faces higher costs and thinner margins. Allowing a $1.4M Banksy piece to shred live on the auction block certainly didn’t help.
Whether or not the volatile auction biz is best suited for life as a privately held company remains to be seen. But one thing is for sure, the art world is about to become a whole lot less transparent ...
The same quarterly results which offered valuable insight into the health of the art market also put Sotheby’s at a distinct disadvantage to its competitors, namely Christie’s which is privately held. With Sotheby's reverting to the shadows, the art world will be without a public bellwether of the industry's overall health.
So why did Drahi really want Sotheby's?
Two words: trophy kill. Drahi will add a nearly 300-year-old, world-renowned auction house to his portfolio. And it probably doesn't hurt that French billionaire, Francois Pinault, owns rival Christie's.
Sotheby's Announces Its Biggest Sale — Itself — For $3.7 Billion [NPR]
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