Have I got a deal for Topps (NASDAQ:TOPP) executives: I'll trade them my Mario Mendoza card -- in near-mint condition -- for their Mickey Mantle 1951 rookie card. It's a steal, and I know they'll go for it. Any company willing to consistently slap away a rival $10.75-per-share bid in order to accept a $9.75-per-share offer is a magnet for bum trades.
Sure, Topps had its reasons to go all Bazooka Joe on the higher offer. It came from Upper Deck, a fierce rival that would have every reason to reshuffle the upper brass at Topps. The financing was a little suspect, too. The $9.75 bid that was ultimately accepted by shareholders this week came from Tornante, an investment group led by former Disney (NYSE:DIS) CEO Michael Eisner.
"Topps' management team and employees are the best in the business," Eisner said at the time of the deal. "We look forward to working with all of them to grow the company in new and exciting ways."
All of them?
Self-interest at work
Oh, the lower offer meant that the fat cats at Topps were saving their own hide. It's selfish. It certainly is cheating shareholders out of an extra buck by not being more receptive to higher offers. Because they were slinging mud -- or is it those rock-hard sticks of gum that trading cards used to come with -- at Upper Deck from the get-go, it's no surprise that higher offers didn't pour in.
Given time, Topps could have cut a better deal for the sum of its parts. It could have sold its candy business to Tootsie Roll (NYSE:TR) or Wrigley (NYSE:WWY). If not Upper Deck, its trading-card stronghold would have fit in nicely with Hasbro (NYSE:HAS), JAKKS Pacific (NASDAQ:JAKK), or 4Kids (NYSE:KDE).
But it never happened. A company so bent on cashing out while still staying in went for a bad deal. So I'm going to crease the Mendoza card by bending it in half -- yes, a Mendoza Line -- and Topps will still take it.
Suckers.
