Image copyright Reuters

Sotheby's is being bought by telecoms billionaire Patrick Drahi in a deal valuing the auction house at $3.7bn.

The company, which has been on the New York stock market for 31 years, will return to private ownership after a troubled period.

French entrepreneur and art collector Mr Drahi, founder of telecoms group Altice, is buying Sotheby's amid signs that the art market is booming again.

Sotheby's arch rival Christie's is also French-owned via the Pinault family.

After the financial crisis sent the art market into a tailspin, Sotheby's went through rounds of cost-cutting and faced attacks by hedge fund investors Dan Loeb and Mick McGuire.

Mr Loeb's Third Point group is the second-biggest investor with a 14% stake.

A prominent art collector, Mr Loeb praised the sale, telling Reuters that the price "affirms the value we saw when we first invested in Sotheby's, and rewards long-term investors like Third Point who believed in its potential".

The price being paid is a 61% premium to Sotheby's closing share price on Friday.

Image copyright Getty Images Image caption Patrick Drahi started his career at Philips before joining a subsidiary of US cable giant Liberty Global

Confirmation that the art auction market had picked up came in November 2017 when Salvator Mundi, the long-lost Leonardo da Vinci painting of Jesus Christ commissioned by King Louis XII of France, sold in New York for a record-breaking $450.3m including fees. Christie's handled that sale.

Sotheby's handled 2018's most expensive painting, Amedeo Modigliani's Nu couché, which sold for $157.2m. And in May, the company sold one of Claude Monet's "Meules" (Haystacks) series for $110.7m, which Sotheby's said was a record for an impressionist painting.

Among some of the famous items sold by Sotheby's, which was founded in London in 1744, are art collections of the late Duchess of Windsor, the personal collection of artist Andy Warhol, and Edvard Munch's "The Scream" in 2012.

Morocco-born Mr Drahi moved to France aged 15, and started his career at Philips before joining a subsidiary of US cable giant Liberty Global.

He established himself as a major telecoms entrepreneur over the past six years, buying France's second-biggest mobile phone operator SFR and acquiring US cable companies. He also owns Portugal Telecom.