Charles F. Stewart spent most of his career as an investment banker. Now the co-President of Altice USA and Chief Financial Officer is CEO of an fine art auction house.This commentary by Marion Maneker is available to AMMpro subscribers. (The first month of AMMpro is free and subscribers are welcome to sign up for the first month and cancel before they are billed.) Sotheby’s announced Monday morning that one of Patrick Drahi’s trusted executives, Altice USA co-president and Chief Financial Officer, Charles F. Stewart would become CEO effective immediately. The news was hardly a surprise to those who were waiting to hear whether former CEO Tad Smith would stay on with the firm. Weeks had passed since Smith’s rumored decision day; several of the executives he hired were transitioning out of the firm; new faces with deep ties to Drahi were being appointed in their place. If Smith had stayed, he would have been surrounded by a team with loyalties and ties directly to Drahi. With such strong signals that Smith was not re-upping, all that was left was the white smoke to tell us Sotheby’s would have a new pope. That plume came early Monday morning but the surprise twist was that Smith who is owed a hefty $28m success fee for getting the company sold to Drahi (the fee is couched in the language of a change of control but the real intent is to align executives self-interest with a sale of the firm) would be rolling some of that $28m (possibly the nearly $17m in equity owed to Smith) or even all of it (another $11m in cash was due Smith) into a stake in the now-private company. To formalize his position, Smith would take the title of Senior Advisor. That solution splits the baby nicely. Drahi’s new team is reported to be eager to pull up a chair to the deal-making poker game that drives the very top of the market. No matter how smart they are, these new executives are at a disadvantage to anyone who already has table stakes in the form of deeper knowledge or experience in the unique brand of art deal-making. With Smith invested in the firm’s future performance, Drahi gets the benefit of his experience without impeding Smith’s desire to find his next CEO gig.
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