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Sotheby's to pay special dividend, buy back shares

Jan 29 (Reuters) - Sotheby's will pay investors a special dividend and buy back shares, months after activist investor Daniel Loeb called for a management shakeup at the auction house.

Sotheby's shares rose 7 percent in premarket trading on Wednesday.

The company said it would pay shareholders a $300 million special dividend in March and buy back stock worth $150 million under a new share repurchase program.

Daniel Loeb's hedge fund, Third Point LLC, held a 9.3 percent stake in the company as of Oct. 1.

Loeb said in October that he was seeking to replace Sotheby's Chief Executive Bill Ruprecht and likened the 269-year-old auction house to "an old master painting in desperate need of restoration."