Activist investor Daniel Loeb said on Thursday he would nominate himself and two others to the board of Sotheby's Inc (BID.N), piling pressure on the auctioneer to focus more on its competitive position and management.
Loeb, whose fund Third Point LLC is the biggest investor in Sotheby's with a 9.53 percent stake, has been pressuring the company since October to remove its chief executive and become more competitive against main rival Christie's.
Sotheby's said it had engaged in extensive talks with Third Point over the past months to avoid a proxy battle and had offered to appoint Loeb to its board.
"Sotheby's is disappointed that Third Point has chosen this path," the company said.
In a letter to Chief Executive William Ruprecht in October, Loeb called the auction house "an old master painting in desperate need of restoration."
Investment firm Marcato Capital Management, which holds a 6.7 percent stake in Sotheby's, has also been pushing the company to make changes and return $1 billion to shareholders.
Sotheby's, responding to the shareholders, said in January it would return $450 million to investors through a special dividend and a share buyback.
The company said it would also separate the capital structures of its auction and private sales business from that of its financial services business.
Loeb, in a regulatory filing on Thursday, commended Sotheby's capital return but said "much remains to be done to enhance the company's competitive position." (r.reuters.com/tyb37v)
In a bid to provide "new perspectives" and "different expertise" to move the company forward, Third Point said it would nominate Harry Wilson, Olivier Reza and Loeb for election at the company's 2014 annual meeting.
Harry Wilson is chairman and chief executive of boutique restructuring firm MAEVA Group LLC and was previously a senior adviser to the U.S. Treasury Department, Third Point said.
Olivier Reza is the lead designer and head of the House of Alexandre Reza, a luxury jeweler based in Paris.
Sotheby's shares were down 0.6 percent at $50.19 in midday trading. They touched a year high of $51.16 earlier in the session.
(Reporting by Siddharth Cavale in Bangalore; Editing by Don Sebastian)