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Quick summary: Topps Trading Card Company made headlines in 2021 after a proposed SPAC deal to take the company public fell apart, which means there is no Topps stock symbol to look for on Robinhood. Topps has now been acquired by rival company Fanatics, with the latter set to IPO later in 2022.
Introduction: Topps Company History
Topps has a long history as a company and a complicated one as a publicly traded stock. The company is currently a privately held company, meaning there is no Topps stock to trade and soon will be part of rival Fanatics.
Topps started as a family run business in Brooklyn, NY. Topps has its roots in tobacco but transformed itself into a bubble gum company when the former business began to dry up.
Its most notable product was the iconic Bazooka bubble gum, with a distinctive comic book style wrapper that can still be found in stores today.
The company then began packaging baseball trading cards alongside its gum. The cards were popular enough that it soon became the company’s main line of business. The first ever set was produced in 1952 and contains one of the most sought after individual sports cards ever: the Mickey Mantle rookie card. This card now sells for more than $5 million at auction.
Topps continued to dominate the baseball trading card space and expanded into other major sports from the 1960s onward. The company launched Topps Digital in 2012, including various apps designed to appeal to fans of stats and fantasy baseball.
Topps Stock History
As a stock, Topps has also had multiple incarnations. The first time Topps traded was on the American Stock Exchange in 1972. After initial excitement and a pop in the price, the stock began a steady decline as increased competition and cooling demand in the trading card market. By 1980 the stock was trading in penny stock territory as the company pursued questionable new products and faced bloated costs.
By 1984, Topps stock rallied in the face of a leveraged buyout and was taken private by Forstmann Little. Just three years later, Topps returned to the public markets and had a new IPO in 1987. The company’s revenues were bolstered by both its baseball card business and increasing demand from its expansion into pop culture trading cards.
The stock did well until in early 1990s when the baseball card bubble burst, driven by an oversupply of cards on the market. The stock halved in 1993 due to weak earnings.
Topps stock saw a brief resurgence in the late 1990s driven partly by a renewed interest in baseball as new home run records were set my Mark McGwire and Sammy Sosa and also the advent of Pokemon trading cards.
The company would remain a publicly traded stock until 2007, when it was again taken private by Michael Eisner’s Torante Company.
Topps SPAC with Mudrick Capital Terminated in 2021
Topps was again set to become a stock in 2021 through a SPAC merger with Mudrick Capital. The deal fell through however when Topps lost its MLB license deal to rival Fanatics. The licensing deal was one of Topps most valuable assets and without it made the future of the company’s baseball card trading business appear bleak. Topps had held the license agreement with MLB for 70 years.
The news of the lost license terminated a deal to bring the company back to the stock market that initially valued the company at $1.3 billion, according to CNBC.
In the wake of the news of the failed SPAC merger, Topps said it would remain a private company. Their MLB license does not expire until 2025 and the company also has deals in place with the NHL and MLS.
2022 Fanatics Acquisition of Topps
While putting a brave face on the loss of its MLB license, Topps was in a tough position heading into 2022 facing intense competition from upstart Fanatics and the loss of a key licensing deal set to bite in just a few years.
It came a surprise to few then that the company agreed to be purchased by its competitor for $500 million in early 2022. The deal makes sense for Fanatics as it acquires Topps at a relative discount compared to its previous $1 billion plus SPAC valuation and also can access the MLB trading card license immediately, rather than waiting until 2025 for the terms of the current Topps deal to expire. The Topps deal also brings in license agreements with major global soccer leagues, Formula 1 and the NHL.
The Topps acquisition will add to Fanatics $18 billion valuation as of 2021 as it plans to offer direct-to- consumer options for trading cards and also utilize trading cards to enter the lucrative NFT market.
Fanatics Stock IPO 2022
While the acquisition of Topps by Fanatics means that there will be no Topps stock in the future, all is not lost for investors seeking a piece of the trading card action as a potential investment. That’s because Fanatics plans to go public itself sometime in 2022.
True believers in the value of Topps brand will be able to access it as an investment as well as the fast growing Fanatics consumer brand. Fanatics is already involved in the distribution of hard and soft merchandise for sports franchises, such as official jerseys and now with the Topps deal will hold the official licensing agreements for trading cards with every major US sports league.
The company has plans to expand into collectibles, NFTs, broadcasting and sports gambling, according to CNBC. There is no set date for an official IPO yet, but most observers expect the company to announce one for sometime in 2022. We will keep this article updated when we hear of an announcement.