French telecoms and media mogul Patrick Drahi is acquiring Sotheby's auction house, one of the world's biggest art brokers, in a $3.7 billion deal, the British-founded company announced Monday.
Drahi, the billionaire founder of the Altice empire which owns SFR telecoms company and several French media houses including BFM news channel and Liberation newspaper, is paying $57 per share to acquire Sotheby's through his company BidFair USA, the art house said.
The deal returns the company to private ownership after 31 years as a publicly traded company on the New York Stock Exchange.
Sotheby's shares soared 57 percent to over $55 in opening trading in New York on news of the offer, which represents a 61 percent increase over Sotheby's closing price on Friday.
"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," Tad Smith, Sotheby's CEO, said in the statement.
"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," he added.
Drahi, who is worth $9.1 billion according to US business magazine Forbes, said that he was "honoured" that Sotheby's board had recommended to shareholders that they accept his 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," he said.
The deal is subject to regulatory and shareholder approval. It is expected to be finalised in the fourth quarter of 2019.
His foray into the art market sees him follow in the footsteps of fellow French billionaire, Kering chairman Francois Pinault, who acquired a majority stake in Sotheby's rival Christie's in 1998.
The self-made Drahi was born in Morocco and moved to France at 15. He is a French citizen, but also holds Israeli and Portuguese citizenship.
He took advantage of historic low interest rates to embark on a major acquisition spree in 2014 and 2015.
Drahi started his career at Philips and then moved to a subsidiary of cable giant Liberty Global before striking out on his own as a telecoms entrepreneur.
After buying up several troubled cable and mobile operators he entered the big league in 2014 when he fought off rival Bouygues to buy France's second-biggest mobile phone operator SFR.
The following year he stormed the US market, acquiring a 70 percent stake in cable company Suddenlink in a $9 billion deal, and then snapping up Cablevision for $17.7 billion.
Through the Netherlands-based Altice he also owns 75 percent of Numericable, France's largest cable operator, as well as Portugal Telecom.
By 2017, his acquisitions had saddled Altice with around 50 billion euros in accumulated debt, sending its share price into freefall and causing jitters among investors.
Promising to slow his expansion drive, Drahi returned that year as chairman of Altice's board to try turn the group around.
Despite the uncertainty over its future, business has continued for Sotheby's. In May, a Sotheby's auction in New York sold a Monet painting from his celebrated "Meules" (Haystacks) series for $110.7 million, an auction record for the artist.
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