Published: Thu, June 20, 2019
Life&Culture | By Sue Mclaughlin

Media Mogul Patrick Drahi Buys Sotheby's Auction House for $3.7 Billion

Media Mogul Patrick Drahi Buys Sotheby's Auction House for $3.7 Billion

Telecom tycoon and founder of Altice, Patrick Drahi, has made a shock move into the art world by purchasing London auction house Sotheby's for £2.9 billion (€3.37 billion).

Drahi, France's ninth richest individual with an estimated net worth of $9.1 billion according to Forbes magazine, said that he was "honoured" that Sotheby's board had recommended to shareholders that they accept his offer.

The New York-based company, which celebrated its 275th anniversary earlier this year, said it had accepted an offer from Drahi, a media and telecoms entrepreneur, that values it at 60% more than its closing share price on Wall Street last Friday.

Added Drahi in the same statement: "As a longtime client and lifetime admirer of the company, I am acquiring Sotheby's together with my family". Drahi said the acquisition had "no capital link with Altice Europe or Altice USA" and would be funded through the bank BNP Paribas, as well as by equity provided from his personal holdings.

Patrick Drahi, a French-Israeli businessman, founded the telecom company Altice in 2001 in Europe, and over the course of almost 20 years, he has turned Altice into a multinational broadband, telecommunications, media, digital and advertising company. Before Monday the stock was down 11 per cent in the year to date.

Born in Morocco and educated in Paris, the 55-year-old businessman is known for his debt-fuelled.

The auction house began life in London in 1744 as a dealer in rare books and did not enter the world of fine arts until the early 20th century, moving to NY in 1965 as the USA market became increasingly important.

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For fiscal 2018 (ended December 31), the auction house's overall net income totaled $108 million, down from the prior year's $118 million.

In many ways, being public put Sotheby's at a competitive disadvantage to its main USA rival Christie's, which was already private, art experts said. Adjusted profit totalled $128.9 million, or $2.48 per share. Its stock is the oldest listed on the New York Stock Exchange. Sotheby's second-biggest shareholder is Daniel Loeb's Third Point hedge fund.

The CEO of French online art sales database ArtPrice described him as a "secretive" art collector who had in his possession some "fairly spectacular" works by Belarussian-French artist Marc Chagall.

Sotheby's arch rival Christie's is also French-owned via the Pinault family.

Sotheby's common stock in a transaction with an enterprise value of $3.7 billion.

Sotheby's was founded in London in 1744, and expanded overseas in the 20th century, moving to NY in 1955, Asia and France in 2001.

BNP Paribas and Morgan Stanley advised Drahi, while LionTree Advisors worked on behalf of Sotheby's.

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