Dreweatts auction house at Donnington Priory near Newbury.

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The deal, announced today, does not include dealer Mallett.

The £1.25m was paid in cash on completion of the deal and a maximum additional consideration of £0.4m is payable over the next 24 months.

Gurr Johns said it has bought the firm as an investment and it will be operated by George Bailey, who was previously chairman of Dreweatts and Bloomsbury.

ATG understands that Gurr Johns has bought the entire Dreweatts business but has only purchased the Bloomsbury brand name and not the book specialist's staff.

Harry Smith, chairman of Gurr Johns, said: "The 21st century auction market continues to evolve; while there’s an increasingly intense focus on the very highest levels, where we operate as advisers and valuers, we’ve also observed huge opportunities at lower levels, particularly since the closure of Christie’s South Kensington.

"We believe that George Bailey and his team are perfectly placed to take advantage of these opportunities."

Stamp and coin dealership group Stanley Gibbons had first entered into an agreement to sell Dreweatts to Mark Law's Millicent Holdings in May. However the deal did not complete due to lack of funds.

Stanley Gibbons said it is seeking a termination fee from Millicent.