While sharing details about its weak first-quarter earnings report,Sotheby’s disclosed on Monday that an outside investor has expressed interest in buying at least 10 percent of the company.
Neither the name of the investor nor details about their intent were disclosed. But the announcement could add fuel to recent speculation that Sotheby’s, which has seen its shares fall by roughly 40 percent over the past year, could be ripe for a large investor to either take partial control of the company, or take it private.
During a call with investors Monday morning, Sotheby’s CFO Mike Goss said, “We’ve recently been advised by an outside investor that they may make purchases of our stock whether through the open market, privately negotiated transactions, block trades or derivative transactions to bring their holdings to at least 10 percent of the shares outstanding, and that they’ve filed the necessary documentation under the Hart-Scott-Rodino Act that would allow them to do so.”
He added that, “Of course, they have no obligation to purchase stock and they could decide for any reason not to do so.”
Sotheby’s market cap is around $1.6 billion and could be seen as a trophy asset for many of the world’s art-collecting billionaires. Its rival, Christie’s, is a private company controlled by French billionaire Francois Pinault.
Sotheby’s on Monday reported a wider-than-expected first-quarter net loss of $25.9 million in the quarter on revenues of $106.5 million — compared to a profit of $5.1 million on $155.7 million in revenue during the first quarter of 2015.
As of Monday morning, Third Point and Marcato Capital Management were the company’s largest shareholders, each owning more than 10 percent of Sotheby’s outstanding shares. Billionaire Steve Cohen’s Point72 is also a large shareholder.