Collectors Universe agrees to be acquired by investor group 3 3

[RWB]

“Collectors Universe agrees to be acquired by investor group led for $75.25/share in cash

9:25 AM ET 11/30/20 | Briefing.com

 

“Collectors Universe has entered into a definitive agreement under which an investor group led by entrepreneur and sports card collector Nat Turner, D1 Capital Partners, and Cohen Private Ventures will acquire all of the company's outstanding shares of common stock for $75.25 per share in cash.The transaction represents a premium of approx. 30% over the company's 60-day volume-weighted average price ended on November 25. The transaction, which was approved by the Collectors Universe Board of Directors, represents fully diluted equity value of approx. $700 mln and is not subject to any financing contingency. The transaction is expected to close in the first calendar quarter of 2021. Upon completion of the transaction, Collectors Universe will become a privately held company, and its shares will no longer be listed on any public market.”

[gmarguli]

Fairly flat financial numbers, but stock price triples in the last 6 months and now being taken private for only a couple dollars above close. 

[Cat Bath]

Get rid of the beach house & cut some heads.

This should be fun to watch.

Edited December 1, 2020 by Cat Bath

[Moxie15]

As with any business Collectors Universe 's first mission is to make money. The board decided it is more profitable to sell now then to continue conducting business as normal. DI Capital Partners thinks that it is more profitable to purchase CU now. I have no knowledge of DI so I wonder what their thinking is . I expect their vision is different and there will be major changes.  If they do not break it up to sell the pieces at a profit there will be considerable changes in management and procedure. 

 

This is something I have been expecting for a while now. We will see what this does to their reputation. Personally I expect some major changes in their market acceptance. We shall see.

Edited December 1, 2020 by Moxie15

[brg5658]

Chop it up, bank the profits, and burn the place down on your way out.  Nat Turner already has a history of these kinds of deals.  Invest in something, grow its perceived value, pray for an acquisition for crazy money, then jump ship with your bags of money.  

 

Edited December 2, 2020 by brg5658

[Coinbuf]

It does have the kool aid crowd ats all wringing their hands worried that the sky is falling, should be interesting to see what transpires.

[Alex in PA.]

OMG!  Sell it???  Please tell me NO!

 

[MarkFeld]

2 hours ago, Coinbuf said:

It does have the kool aid crowd ats all wringing their hands worried that the sky is falling, should be interesting to see what transpires.

That was an exaggerated cheap shot. There are plenty of posters there (and here,) who aren’t part of kool aid crowds. And the large majority of posts on the subject were nothing like your characterization.

[RWB]

4 hours ago, MarkFeld said:

That was an exaggerated cheap shot. There are plenty of posters there (and here,) who aren’t part of kool aid crowds. And the large majority of posts on the subject were nothing like your characterization.

Businesses make business decisions - they are not confined to the restrictions of government....or whims of hobbyists. The buyer has already decided what they want to do to maximize ROI and we will see that play out over the next year or two.

[Cat Bath]

9 hours ago, Coinbuf said:

It does have the kool aid crowd ats all wringing their hands worried that the sky is falling, should be interesting to see what transpires.

The new owners should buy Legend & CAC also.

Scuttle all 3

[Coinbuf]

7 hours ago, MarkFeld said:

That was an exaggerated cheap shot. There are plenty of posters there (and here,) who aren’t part of kool aid crowds.  And the large majority of posts on the subject were nothing like your characterization.

So lets break this down Mark, you say "There are plenty of posters there (and here,) who aren’t part of kool aid crowds" which implies that there are posters that are part of the kool aid crowd posting about the proposed buyout.  Next you say "And the large majority of posts on the subject were nothing like your characterization".  So it would seem that you agree that some posts are like my characterization and that there is a group of posters there that are a part of the kool aid crowd.  As you agree with me that there are members of the kool aid crowd posting about this proposed buyout and that my characterization of some of those posts is correct just what is your issue with my post?  If you have a different opinion you are free to post that opinion without taking a cheap shot at me.

[MarkFeld]

6 hours ago, Coinbuf said:

So lets break this down Mark, you say "There are plenty of posters there (and here,) who aren’t part of kool aid crowds" which implies that there are posters that are part of the kool aid crowd posting about the proposed buyout.  Next you say "And the large majority of posts on the subject were nothing like your characterization".  So it would seem that you agree that some posts are like my characterization and that there is a group of posters there that are a part of the kool aid crowd.  As you agree with me that there are members of the kool aid crowd posting about this proposed buyout and that my characterization of some of those posts is correct just what is your issue with my post?  If you have a different opinion you are free to post that opinion without taking a cheap shot at me.

“It does have the kool aid crowd ats all wringing their hands worried that the sky is falling, should be interesting to see what transpires.”

“Let’s break it down”...You used the words “crowd” “all” and “sky is falling”. If the number of those expressing worry constituted a crowd, it was a very small “crowd”. And “all” certainly didn’t apply. How many posters did you characterize accurately/fairly? None, as under the circumstances, worrying that the forum will be closed is a far cry from the “sky is falling.” 

“sky is falling, the

An absurd belief that disaster is imminent. The term comes from a fable about a chicken who believes the sky is falling when an acorn falls on its head.”

Tell me with a straight face that your remarks were fair and accurate and I’ll suggest that you go read “Chicken Little” and then write your own fable.

Edited December 3, 2020 by MarkFeld

[Alex in PA.]

I'm going with Mark Feld's assessment on this.  I visit over ATS and, as of last night, there was ONE thread on this with 48 comments and it appears to have gone this morning.

Seems to me there are more "Kool Aid" drinkers here than ATS>  What say you?

[MAULEMALL]

Jim Jones would be upset that you denigrate Kool Aid..

Especially the fruit punch.. Our outrage manifests itself to the point that our fat little pitcher destroys walls of buildings...

That Sir, Is on your head... 

[MAULEMALL]

1 hour ago, MarkFeld said:

“It does have the kool aid crowd ats all wringing their hands worried that the sky is falling, should be interesting to see what transpires.”

“Let’s break it down”...You used the words “crowd” “all” and “sky is falling”. If the number of those expressing worry constituted a crowd, it was a very small “crowd”. And “all” certainly didn’t apply. How many posters did you characterize accurately/fairly? None, as under the circumstances, worrying that the forum will be closed is a far cry from the “sky is falling.” 

“sky is falling, the

An absurd belief that disaster is imminent. The term comes from a fable about a chicken who believes the sky is falling when an acorn falls on its head.”

Tell me with a straight face that your remarks were fair and accurate and I’ll suggest that you go read “Chicken Little” and then write your own fable.

[MAULEMALL]

So when you are talking down to people on these boards or impose your beliefs in the context of their post  are you doing it for Heritage auctions inc or just because you know better than them in what they post?

We all know you can get posts deleted here so can you get thoughts deleted as well?

[MarkFeld]

2 hours ago, Alex in PA. said:

I'm going with Mark Feld's assessment on this.  I visit over ATS and, as of last night, there was ONE thread on this with 48 comments and it appears to have gone this morning.

Seems to me there are more "Kool Aid" drinkers here than ATS>  What say you?

Here's a thread on that subject, that's still alive: https://forums.collectors.com/discussion/1047697/collectors-universe-has-been-sold#latest

[jtryka]

This makes me sad that I never bought the stock at $3...by the way, private equity folks rarely buy businesses with the intent of destroying them (though to be fair, it does happen occasionally).

Edited December 3, 2020 by jtryka

[MAULEMALL]

9 minutes ago, jtryka said:

This makes me sad that I never bought the stock at $3...by the way, private equity folks rarely buy businesses with the intent of destroying them (though to be fair, it does happen occasionally).

I had a shot at AMD at $2.50 5 or 6 years ago ... $93.71 today and still a ton of headroom....

[brg5658]

1 hour ago, MarkFeld said:

Here's a thread on that subject, that's still alive: https://forums.collectors.com/discussion/1047697/collectors-universe-has-been-sold#latest

There is also one in the "World" section: https://forums.collectors.com/discussion/1047737/collectors-universe-bought-privately-by-investors-group-what-affect-do-you-think-this-will-have

I rarely leave the "World" section on CU forums because they are a train wreck of bickering completely non-numismatic threads.  

Edited December 3, 2020 by brg5658

[GoldFinger1969]

On 11/30/2020 at 8:38 PM, gmarguli said:

Fairly flat financial numbers, but stock price triples in the last 6 months and now being taken private for only a couple dollars above close. 

The stock price did NOTHING for 20 years.  This looks like either D1/Cohen will be running a collectibles business for a long time (doubt it)...or they are going to fix-it-up and re-IPO it within 3-5 years and still triple their money. 

[GoldFinger1969]

On 12/1/2020 at 7:47 AM, Moxie15 said:

As with any business Collectors Universe 's first mission is to make money. The board decided it is more profitable to sell now then to continue conducting business as normal. DI Capital Partners thinks that it is more profitable to purchase CU now. I have no knowledge of DI so I wonder what their thinking is . I expect their vision is different and there will be major changes.  If they do not break it up to sell the pieces at a profit there will be considerable changes in management and procedure.  This is something I have been expecting for a while now. We will see what this does to their reputation. Personally I expect some major changes in their market acceptance. We shall see.

I don't see any conglomerate M&A type stuff.  This isn't s a large enough company where spin-offs and sales of divisions lead to a sum-of-the-parts value that is greater than the stock price.

I have to think they believe the at-home thing is here to stay and that more collectibiles grading in the U.S. and oveseas means the topline can keep growing.

This deal pays for itself in 3 years on an IRR basis if the top line can grow closer to 20% a year.

 

Edited December 3, 2020 by GoldFinger1969

[GoldFinger1969]

22 hours ago, brg5658 said:

Chop it up, bank the profits, and burn the place down on your way out.  Nat Turner already has a history of these kinds of deals.  Invest in something, grow its perceived value, pray for an acquisition for crazy money, then jump ship with your bags of money.  

This is a small-cap company that doesn't lend itself to that kind of situation.

[GoldFinger1969]

13 hours ago, RWB said:

The buyer has already decided what they want to do to maximize ROI and we will see that play out over the next year or two.

Has the buyer told us that ?  I doubt it.  This is a small-enough company that I cold see D1/Cohen keeping it a long time...or just fixing-it-up and expanding overseas/currency and re-IPOing in a few years.

They may think they can get the valuation to $2 billion within 3-5 years.

 

Edited December 3, 2020 by GoldFinger1969

[RWB]

3 minutes ago, GoldFinger1969 said:

Has the buyer told us that ?  I doubt it.  This is a small-enough company that I cold see D1/Cohen keeping it a long time...or just fixing-it-up and expanding overseas/currency and re-IPOing in a few years.

They may think they can get the valuation to $2 billion within 3-5 years.

 

To me, the buyer's actions show their intention. Buying a small, specialized business is tricky stuff, and no private investor like the buyer would make the purchase at current prices unless they already had a solid profit plan. It also cuts off a lot of expense required for public corporations.

[brg5658]

3 minutes ago, GoldFinger1969 said:

Has the buyer told us that ?  I doubt it.  This is a small-enough company that I cold see D1/Cohen keeping it a long time...or just fixing-it-up and expanding overseas/currency and re-IPOing in a few years.

They may think they can get the valuation to $2 billion within 3-5 years.

 

By what means would the growth happen?  Continually changing plastic formulations to encourage resubmissions?  Continued gradeflation to encourage resubmissions?  Convincing the rest of the world besides the US that slabs are useful?  The slippage of PCGS in terms of their consistency in grading has been noticeable the past 2-3 years.  I also believe their fundamentals are pretty flat, so the recent huge uptick in their stock price is not justified.  Like much of the stock market at the moment, it's being propped up artificially by policy.  IMO the 3-5 year horizon has a bubble a comin'!  I'm thankful I'm 20-ish years from retirement.

[Conder101]

4 hours ago, Alex in PA. said:

I visit over ATS and, as of last night, there was ONE thread on this with 48 comments and it appears to have gone this morning.

Why was it gone?  Poofed?  Could there have been other threads that were Poofed already that you didn't see?  Disclaimer, I have no idea, I don't frequent that forum.

Edited December 3, 2020 by Conder101

[GoldFinger1969]

34 minutes ago, RWB said:

It also cuts off a lot of expense required for public corporations.

I'm not sure about that, Roger.  I don't think CU has tons of overhead spread all over the world....yeah, it may be possible to do some grading at home (or maybe not)....but if anything, they should want to be in expansion mode.

A large-cap company you can cut the fat.  Doubt it on a small-cap like this whose very public trading existence was questioned over the years (it was probably done for liquidity for key employees).

[GoldFinger1969]

36 minutes ago, brg5658 said:

By what means would the growth happen?  Continually changing plastic formulations to encourage resubmissions?  Continued gradeflation to encourage resubmissions?  Convincing the rest of the world besides the US that slabs are useful?  The slippage of PCGS in terms of their consistency in grading has been noticeable the past 2-3 years.  I also believe their fundamentals are pretty flat, so the recent huge uptick in their stock price is not justified.  Like much of the stock market at the moment, it's being propped up artificially by policy.  IMO the 3-5 year horizon has a bubble a comin'!

D1 and Steve Cohen see something the rest of us haven't.  I'm not sure if it's global expansion or the stay-at-home thing.

Clearly, they must see top-line growth somewhere because this isn't a cost-cutting thing you can make money on, not when the stock price is up 3-fold from a year ago and 5x from the March lows.

Edited December 3, 2020 by GoldFinger1969

[Coinbuf]

5 hours ago, MarkFeld said:

“It does have the kool aid crowd ats all wringing their hands worried that the sky is falling, should be interesting to see what transpires.”

“Let’s break it down”...You used the words “crowd” “all” and “sky is falling”. If the number of those expressing worry constituted a crowd, it was a very small “crowd”. And “all” certainly didn’t apply. How many posters did you characterize accurately/fairly? None, as under the circumstances, worrying that the forum will be closed is a far cry from the “sky is falling.” 

“sky is falling, the

An absurd belief that disaster is imminent. The term comes from a fable about a chicken who believes the sky is falling when an acorn falls on its head.”

Tell me with a straight face that your remarks were fair and accurate and I’ll suggest that you go read “Chicken Little” and then write your own fable.

Stop being a troll Mark, you are not the forum police and I do not answer to you.  As I said if you have a different perception of the post ats you are free to pen your own thoughts there is no need to continue to take cheap shots at me.  There is something called the first amendment, I suggest that you should read that.  Your feeble attempt to get me to react in a way that would get me a time out will not work and it only makes you look more and more foolish.