Michael Eisner’s Tornante Company is backing an initial public offering for sports trading card company Topps Inc., with the former Disney boss set to remain chairman.
The $1.3 billion public move will be the result of a merger with a SPAC, one of the popular investment vehicles also known as blank-check companies. A range of SPACs have recently attracted interest from a pedigreed group of entertainment executives and celebrities. SPAC deals have resulted in publicly traded companies like sports betting firm DraftKings and digital media aggregator Group Nine.
Mudrick Capital Acquisition Corp., the SPAC in question, will generate gross proceeds of $571 million through the transaction. An injection of $250 million in private funds will come from Mudrick Capital and other institutions like GAMCO Investors and Wells Capital Management. Topps will trade on the Nasdaq under the ticker symbol “TOPP.”
Topps, which Tornante bought for $385 million in 2007, has been a leading purveyor of trading cards for more than 80 years. More recently, it has been exploring a booming component of the sports collectibles business: non-fungible tokens, which use blockchain technology. NFTs containing NBA video highlights — a dunk by LeBron James, for example — have reached $230 million in value, according to an estimate in February by Dapper Labs. Instead of swapping cards, fans trade a currency suited to the 21st century.
In an interview with CNBC, Eisner said Topps currently gets about 25% of its revenue from digital sources but that area of the company is “growing really fast.” Blockchain, he said would enable the company to “participate in the secondary market” around collectibles.
“I bought the company because I thought it had a great consumer emotional appeal, the way Disney did,” Eisner said. The decision to go public was made before the explosion of blockchain and NFTs, he maintained, adding, “We’re running the company as a real company and this is the icing on the cake.”
In addition to its core sports cards business, Topps also owns a line of confections including Bazooka gum.
Here’s a longer piece of the CNBC interview:
"We are now about 25% digital, however the digital is growing really fast," says @topps Chairman Michael Eisner on #NFTs. "Now with blockchain we are going to be able to participate in the secondary market." pic.twitter.com/K2i34kdzDP
— Squawk Box (@SquawkCNBC) April 6, 2021