This week French-Israeli telecoms billionaire, Patrick Drahi, bought Sotheby’s auction house for a staggering $3.7 billion (£2.9 billion). Drahi’s purchase returns the auction house to private ownership after 30 years of public trading on the stock market.
Founded in 1744, Sotheby’s originally traded as a bookseller until it expanded into the international art market in the mid-1950’s. Tad Smith, Sotheby’s chief executive, hopes the “flexible private environment” provided by the new ownership will allow the company to grow in a much easier and competitive manner.
“I am honoured that the board of Sotheby’s has decided to recommend my offer,” said Drahi about his deal with the 275-year-old company. Sotheby’s accepted the offer on Monday, which values it at 60% more than its closing share price on Wall Street last Friday.
According to Forbes, Drahi is currently worth an estimated $9.3 billion (£7.4 billion) as the founder and majority shareholder of the telecoms firm Altice. Yet before this announcement, his name remained relatively unknown even to those within the art world. So, why has he bought an international auction house?
“Sotheby’s is one of the most elegant and aspirational brands in the world,” explained Drahi, “as a long-time client and lifetime admirer of the company, I am acquiring Sotheby’s together with my family.”
Drahi has also amassed a private collection of 20th-century art, including works by Pablo Picasso and Henri Matisse. He is particularly keen on French Orientalist painters such as Théodore Géricault, Théodore Chassériau and Eugène Delacroix.
Speaking to the Financial Times about Drahi, a billionaire art collector disclosed that “in the world of art, he has little recognition, except that he buys every now and then.”
Over the last few years, Sotheby’s has not made a profit and regularly loses out to Christie’s, its privately-owned rival. In 2018 Christie’s sold the Peggy and David Rockefeller collection for $835 million (£664 million), the highest-grossing auction ever of a private collection.
In light of Sotheby’s recent lack of headline-grabbing consignments, a prominent London art dealer stated that Drahi was “bonkers to pay that price…Sotheby’s shareholders will be jumping up and down for joy.”
Although buying Sotheby’s was not a particularly wise financial investment, Drahi stands to gain alternative benefits. A fellow billionaire art collector revealed, “Sotheby’s is a superb brand, which never makes money, but it gives its owners a seat at the table of the rich and famous.”
Drahi’s offer will require approval from the company’s shareholders and clearance from regulators before completion.