Madison Dearborn backs baseball cards deal

The Chicago-based company, along with Michael Eisner’s investment firm, has agreed to pay $385m for Topps, manufacturer of iconic American trading cards and classic confections.

Major League Baseball trading cards and Bazooka bubblegum are among the brands to be owned by two buyout firms following the $385 million (€292 million) acquisition of The Topps Company.

Madison Dearborn Partners and The Tornante Company, founded by former Disney chief executive Michael Eisner, have agreed to pay $9.75 per share in cash. The deal is subject to shareholder and regulatory approvals, and is expected to close in the third quarter of this year.

Topps has 40 days to solicit alternative offers, but does not intend to disclose additional information until the process is complete, according to a statement. The famous American company was founded in 1938, and its youth-oriented products include NFL and NBA trading cards, sticker album collections, games, and candy brands including Ring Pops and Push Pops.

“Topps is a wonderful company with a powerful brand portfolio and rich history,” said Eisner in a statement. “Topps’ management team and employees are the best in the business, and we look forward to working with them to grow the company in new and exciting ways.”

In January, Topps released third quarter 2006 earnings that reflected an 8 percent rise in revenues compared to the same quarter of 2005. It also reported a $4.7 million operating income for the quarter, a 461.5 percent increase from the $1.3 million loss in incurred in the third quarter of 2005. During midday trading Tuesday on the Nasdaq, Topps shares were trading at $9.80, or nearly 10 percent higher than the previous day’s closing price.

Founded in 2005, Tornante invests in entertainment and media-related opportunities. Most recently, it co-invested in a $12.5 million fundraising round for Veoh Networks, an independent Internet television broadcasting system. In June 2006, the firm acquired children’s sports production company Team Baby Entertainment for an undisclosed amount.

Madison Dearborn, a 15-year private equity veteran, currently has more than $14 billion in capital under management. Its fifth fund closed on $6.5 billion in 2006. Its most recent acquisition was the $1.7 billion buyout of the Yankee Candle Company in October 2006.