We're Not Going To Disneyland, After All

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Posted By: <b>bruce Dorskind</b><p>HOSTILE BID FOR TOPPS<br /><br /><br />June 26, 2007 -- Sports card maker Upper Deck launched a hostile tender offer for rival Topps last night that threatens to throw cold water on a $385 million takeover of the iconic company by former Disney boss Michael Eisner.<br />Upper Deck said yesterday that it will offer Topps shareholders $10.75 for each share in an offer that expires on July 24. That offer beats the current $9.75 per share deal that Topps reached with Eisner's Tornante Co. and buyout firm Madison Dearborn Partners back in March.<br />Topps' board had said a bid from Upper Deck, which tried to submit a friendly offer to the company in April, was too conditional on financing and antitrust issues to go forward.<br />Upper Deck then sued and won a lawsuit against Topps, the owner of Bazooka Joe, to get out of a confidentiality agreement that prevented it from launching a tender offer. Topps then postponed a shareholder meeting scheduled for June 28 to vote on the Eisner deal.<br />The deal with Eisner has caused several large Topps shareholders, who also have representatives on the company's board, to launch a proxy contest against the other directors, who they have dubbed "the seven dwarfs."<br />Eisner, who sources say miscalculated Upper Deck's seriousness about acquiring Topps, now has to raise his offer or walk away from the deal.<br />In addition, to baseball cards, Topps makes bubble gum and other collectibles.

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Posted By: <b>Cobby33</b><p>Although Eisner has already been ousted by the Disney folks, at least his group would have brought some new creativity into the modern market. With UD at the helm, all we're left with is more overpriced, overproduced junk, with few exceptions.

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Posted By: <b>davidcycleback</b><p>Amongst collectors of the modern, 'shiny' cards, a majority say Topps produces a better produce and has better quality control than Upper Deck. As one example, Topps has a representative present when the players sign the cards, which not all card companies have done. Upper Deck, on the other hand, is the one that can't fit the player's signature within the hole, and many collectors have had major problems with UD redemptions. Many have commented that UD doesn't appear to care about the collectors.

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Posted By: <b>peter chao</b><p>I would strongly prefer Eisner and Topps pairing up, that would be much more interesting than a market controlled by Upper Deck and their printing presses. Upper Deck has no idea of what a limited press run means. <img src="/images/happy.gif" height=14 width=14><br /><br />Peter

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Posted By: <b>Chris Ahart</b><p>On one hand it would be nice to get some new blood in the hobby. On the other, I'm not sure Eisner backed by an investment firm would be into it for the long term. I've seen a few companies get bought by a group like the one interested in Topps. They all pretty much do the same thing after the purchase, trim down management & costs, increase margin, and sell in five to ten years for profit (kind of like the investment firm that has part ownership of Nebraska Book Company for those who track that kind of stuff). Long term growth is not the goal for this style of ownership. The goal for these guys is to make Topps look better on paper and flip for a profit. Not that there is anything wrong with that, it happens all the time. I just am not sure I like the idea of it happening to Topps as I collect vintage & modern cards. The modern card industry needs managed long term growth due to all of the different stuff out there fighting for kids (and adults) money. Trading cards gets nowhere close to the amount of money or time from kids as video games do. <br /><br />Upper Deck already understands the modern industry. They've seen the boom & bust. I know a lot of modern collectors and dealers don't like Upper Deck, but I would rather have a company who understands the industry and its current shortcomings purchase Topps. I have seen both Topps & Upper Deck's ordering set ups for dealers. Upper Deck blows Topps away with the online ordering, getting previews of upcoming product out to dealers BEFORE they have to place their orders (Topps sent the dealer promo sheet for Topps Chrome to dealers two weeks after the orders had to be placed. Nothing like ordering a product sight unseen), and dealear support. Upper Deck usually responds to dealer emails within hours, Topps has sometimes taken days. I know that doesn't seem like much, but I think I can usually tell the over all health of a company by how much they sweat the small stuff and communicate with their customers. That's just my two cents & I'm sure others will differ. <br /><br />edited for piss poor english skills

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Posted By: <b>leon</b><p>That makes a lot of sense to me. I know Beckett got bought out and away goes a lot of the veterans. Veterans generally cost a little/lot more than new snotty nosed kids. (not that there's anything wrong with snotty nosed kids) Short term profit looks good...long term they could care less....just my 2 cents too....

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Posted By: <b>peter chao</b><p>Upper Deck started with a great idea and then overdid it. Upper Deck started the premium card market and then flooded it with '89 Upper Deck cards. How many Ken Griffey Jr. #1s are there. It's got to be in excess of 5 million. They are going to do the same thing with memorabilia cards, there will be so many of them nobody will care.<br /><br />I would rather have Eisner calling the shots until some other corporation that cares about the Hobby can be found.<br /><br />Peter

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Posted By: <b>Bob</b><p>Michael Eisner did such a horrible job managing Disney that I'd rather see a class of 6th graders take over Topps for their school project, than this moron. Ask any Disney stockholder what they think about the "managing skills" of Eisner and you'll have to blush from the language.

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Posted By: <b>Bob C</b><p>Bruce this would be much more interesting if I had a dog in the fight. Unfortunately I do not own shares, calls or puts, if they exist, in Topps.<br />Being a savvy New York City hedge fund, arbitrage, technical trend follower/mover/shaker kind of guy, what say you Bruce? Should we all give our brokers a call?<br />Gosh I have to say you have really stimulated my interest here - but that was the purpose of your post, no?<br />Highly informative to be sure, and dovetails nicely into the purpose of this board.<br />

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Posted By: <b>WP</b><p>It seems like the UD bid was meant to stall the Eisner bid an is not a serious offer.