Sotheby's Sells Down Under Division

The Age.com.au of Australia is reporting that Sotheby's has solds its Australian auction operations to a rival auction house owned by First East Auction Holdings Limited. The interesting aspcect is that First East Auction Holdings currently partners with Bonhams and operates as Bonhams Goodman. The partnership and licensing agreement with Bonhams is expected to expire at the end December, which is the same time the Sotheby's sale is expected be consummated. Bonhams is expected to stay in the Australian market.

The Age reports

Industry observers were stunned by the takeover.

''It's an extraordinarily audacious move to convert oneself from Bonhams & Goodman to Sotheby's,'' said former Sotheby's Australia managing director Mark Fraser. ''It's also extraordinary that Sotheby's Holdings, the parent company in New York, has decided to move in this direction. In most other countries they have simply closed down the operation. I would say this is unprecedented … Sotheby's has not liked licensing their name.''

Sydney art dealer Denis Savill compared Mr Goodman's feat to Sir Edmund Hillary's conquest of Mount Everest: ''I liken him to Sir Edmund Hillary … in the tenacity and ambition he had to own the plum auction house.''

Sotheby's has been struggling in the economic downturn, and its profit and share prices have plummeted. Its shares closed in New York on Friday at $US15.66, still far below the all-time high of $US57.64 in 2007. In the wake of falling profits and share prices, Sotheby's had been reviewing its operations around the world.

''They were in the process of evaluating operations in Australia as part of a world-wide review when, as I understand, FEAL independently went to Sotheby's and made an attractive offer to acquire it,'' said Sotheby's Australia managing director Lesley Alway.

To read the full article in The Age, click HERE.