Sotheby's increases auction guarantees allowed under credit facility

By Angela McDaniels

Tacoma, Wash., June 28 - Sotheby's amended its $300 million credit facility due December 2017, increasing the maximum amount of net outstanding auction guarantees permissible to $300 million from $100 million.

The amendment will allow management to react more quickly to client needs and provides increased operating flexibility to compete for auction consignments, according to an 8-K filing with the Securities.

Net outstanding auction guarantees equal the auction guarantees less the impact of irrevocable bids.

For the five months ended May 31 and the years ended Dec. 31, 2012 and Dec. 31, 2011, Sotheby's issued aggregate auction guarantees totaling $174 million, $274 million and $208 million, respectively, for which the financial exposure was reduced by aggregate irrevocable bids, excluding the additional benefit from the buyer's premium, of $162 million, $238 million and $202 million, respectively.

The lending syndicate is led by General Electric Capital, Corporate Finance.

Sotheby's is a New York-based company that engages in art auction, private sales and art-related financing activities.

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