NEW YORK (TheStreet) - Auction house Sotheby's (BID) said on Wednesday it would consider a sale of its New York City headquarters as part of an effort to reshape the company's financial structure and deliver value to shareholders.
Sotheby's actions come after activist investor Daniel Loeb of Third Point Capital Management took a large stake in the company and criticized its executive pay packages. Third Point, which holds over 9% Sotheby's shares, recommended the company replace its CEO William Ruprecht and consider investing its excess capital in the works of art it sells. Loeb said such a move would not creating conflicts of interest between Sotheby's and its clients.
On Wednesday, Sotheby's took a different course.
The company's board of directors continues to support CEO Ruprecht and instead is focusing on returning capital to shareholders and streamlining the firm's operations.
Sotheby's said it will pay a $300 million special dividend to shareholders in March and that its board has authorized a $150 million share repurchase program to offset dilution from annual stock rewards to employees. The company also said it intends to return any excess capital to shareholders on an annual basis through special dividends.
To improve its financial performance, Sotheby's also is looking into a sale of its York Avenue headquarters and relocating, or reconfiguring the building towards leases.
"Sotheby's is now conducting a bidding process to explore these alternatives and expects to choose a path shortly," the company said, while noting it is conducting a similar process for its New Bond Street offices in London.