In a sweeping reordering of the world of trading cards, the unions representing players in Major League Baseball, the National Basketball Association, and the National Football League have struck exclusive agreements with a new company that they control over the Internet. sporting goods Retailer Fanatics Inc. , said people familiar with the matter.
The deals break the hold of Topps, an icon that has been in the baseball card market since the 1950s. Basketball and soccer players make deals with Panini America, Inc.
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All three guilds – MLBPA, NBPA, and NFLPA – will have stakes in the entity that will now control the nation’s most lucrative sports trading card assets. The MLB and NBA have also made deals with the new company and will also have a stake.
Tops and Panini did not immediately respond to requests for comment.
The MLBPA deal begins in 2023. The current MLB agreement with the Topps runs through 2025. The NBA and NFL union deals run through 2025 and 2026, respectively.
In a memo sent to baseball players Thursday, MLBPA Executive Director Tony Clark said his union deal is more than 10 times larger than any deal the league has ever made. He added that it is part of a series of recent deals that will generate nearly two billion dollars until 2045.
The deals will have a huge impact on the fortunes of long-time sports fan, Topps, and more recently, fanatics. Players and leagues plan to benefit from the same expertise that turned fanatics of an online retailer of sports equipment into a business that makes trading cards accessible to everyday audiences.
Topps, a longtime baseball incumbent, is on his way to going public through a combination with a special purpose acquisition company. That deal estimated, with Mudrick Capital Acquisition Corp. II, the combined entity at about $1.16 billion, the two companies said when they announced the deal in April. Topps released its second-quarter earnings on Wednesday, announcing that sales increased 78% and raising its forecast for the year.
Tops to present stock to the public after teaming up with SPAC
Meanwhile, the fanatics have emerged as one of the most aggressive forces in sports promotion. Its founder and CEO, Michael Rubin, is also the co-owner of the NBA’s Philadelphia 76ers and New Jersey Devils. The company has partnered with nearly every major North American professional sports league for merchandise sales, and has recently indicated its intention to get into areas such as ticketing and online betting.
Fanatics is currently valued at $18 billion after a new funding round, the magazine reported earlier this month, nearly tripling its valuation from last year as it works to expand into new lines of business. Robin will lead the new company.
Topps is the number one manufacturer of baseball cards since the early 1950s, originally packing the cards with bubble gum. The 1952 Mickey Mantle is one of the most popular and expensive cards of all time, with one selling for $5.2 million earlier this year. The company is still synonymous with baseball cards to this day.
More recently, baseball cards have proliferated in popularity, particularly during the pandemic, when national shutdowns and a live sports gap have prompted people to scour attics and basements for old cards.
Topps is currently jointly owned by Tornante and private equity firm Madison Dearborn Partners, and its chairman is former Walt Disney CEO Michael Eisner.
The Topps’ dominant position in the field of baseball is the result of two separate licensing deals: one with Major League Baseball, which allows the Topps to use team logos and branding on their cards; The other is with union, which enables it to use launcher images.
The set of deals allows Topps to produce cards, for example, Fernando Tates Jr. dressed as San Diego Padres. (The MLBPA currently has another licensing deal with Panini, which allows the use of player likeness but not team logos.)
Topps paid $20.4 million to the MLBPA last year, the most of any MLBPA licensee, according to the union’s annual report to the US Department of Labor. The NFLPA got $24.2 million from Panini, according to its most recent filing.
But now Topps is losing a major MLB and MLBPA partner, leaving his future in the baseball card arena unclear.
The rest of the sports card market is divided among other players. Panini has exclusive licenses with the NFL, NBA and their unions, while Upper Deck has an exclusive deal with the NHL and the National Hockey League Players Association.
In his note, Clarke added that players should “continue to honor their obligations and carry out any obligations they may have under any applicable agreements with Tops and Panini” in the meantime.
The NFL, unlike the MLB and NBA, has not struck a deal with the newly formed card company, but that doesn’t stop the league from doing so before completing the current deal with Panini.
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Two years ago, the NFLPA and the MLBPA teamed up in an unprecedented private equity deal that helped lay the groundwork for this turmoil. The magazine first reported in 2019 the creation of OneTeam Partners LLC by the NFLPA and MLBPA, which was launched to expand licensing opportunities for group name, image, and likeness rights. Among those assets stand out: trading card deals.
Write to Jared Diamond at [email protected] and Andrew Peyton at [email protected]
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