Updated: March 6, 2007, 11:54 AM ET

Group led by Eisner buying card maker Topps

Associated Press

NEW YORK -- The Topps Co., maker of baseball cards and Bazooka bubble gum, said Tuesday it accepted a $385.4 million takeover offer from a buyout group that includes former Disney CEO Michael Eisner, but the deal drew immediate opposition from one of its own board members. Topps director Arnaud Ajdler, along with the investment firm Crescendo Partners II, launched a campaign to kill the deal. Crescendo owns about 6.6 percent of the company's shares, according to filings with the Securities and Exchange Commission. Ajdler is also a managing partner of Crescendo. Ajdler said Tuesday he had not yet been in touch with other major shareholders but he thought the deal should be abandoned because negotiations did not go through a proper process and that the Eisner-led offer undervalues the company.
Do you collect? "I believe that the process that led to the signing of the The SportsNation community wants to merger agreement was flawed in that the board of know if you still collect baseball cards. directors did not shop the company and thus failed to If so, what is your favorite card and maximize the competitive dynamics of a sale transaction how did you acquire it? Tell us that would have garnered the highest price available," Ajdler wrote in a letter sent to board members on Tuesday.

The deal was approved in a 7-3 vote by the board with Ajdler and two others voting against the deal. Ajdler was joined by Timothy Brog, president of Pembridge Capital Management LLP, and another board member John Jones. Pembridge had earlier pressed the company to solicit acquisition proposals. The buyout group, which includes The Tornante Co. LLC, founded by Eisner, and the Chicago-based private equity firm Madison Dearborn Partners LLC, has agreed to pay $9.75 for each Topps share, which represents a premium of 9.4 percent over the stock's Monday closing pricing of $8.91 on the Nasdaq Stock Exchange. In a sign that some investors think the bidding could go higher, Topps shares rose 90 cents, or 10 percent, to $9.81 on morning trading on the New York Stock Exchange. Its shares have traded between $7.50 and $10 over the past 52 weeks. The company said in its announcement that it will solicit better offers over the next 40 days. The deal requires regulatory approval and a vote by Topps shareholders, but the company

said it could close by the third quarter. As part of the merger agreement, Chief Executive Arthur T. Shorin agreed to retire within 60 days of the close of the deal. He would remain as a consultant, according to an SEC filing. Shorin, 70, has been CEO of Topps and its predecessor since 1980, according to the company Web site. Eisner was CEO of The Walt Disney Co. for two decades until he stepped down in 2005. Disney owns theme parks, movie studios and the ABC, ESPN and Disney TV networks. Topps, founded in 1938, makes trading cards featuring athletes of Major League Baseball, the NFL and NBA. In addition to Bazooka bubble gum, it owns the Ring Pop and Push Pop brands. Copyright 2007 by The Associated Press