Famed auction house Sotheby's (BID) - Get Report hit the gavel on itself on Monday, announcing it has agreed to be acquired by BidFair USA, an entity wholly owned by media and telecom entrepreneur and art collector Patrick Drahi.

Under the terms of the agreement, Sotheby's shareholders will receive $57 in cash per share of Sotheby's common stock, in a transaction with an enterprise value of $3.7 billion. The offer price represents a premium of 61% to Sotheby's Friday closing price of $35.39.

The transaction would result in Sotheby's returning to private ownership after 31 years as a public company traded on the New York Stock Exchange.

Shares of Sotheby's soared on Monday, jumped more than 58%, or $20.61, to $55.99 on the New York Stock Exchange.  

Sotheby's Chairman Domenico De Sole said in a statement that the board "enthusiastically supports Mr. Drahi's offer, which delivers a significant premium to market for our shareholders. After more than 30 years as a public company, the time is right for Sotheby's to return to private ownership to continue on a path of growth and success."

The transaction is expected to close in the fourth quarter, subject to customary conditions including regulatory clearance and shareholder approvals.