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Proxy Firm ISS Advises vs. Topps Takeover


Influential proxy advisory firm Institutional Shareholder Services recommended Monday voting against the takeover of baseball card company Topps by a private equity firm and an investment group led by Michael Eisner, the former chairman of Walt Disney.

ISS said that investors should oppose the $385 million bid from Madison Dearborn Partners and Tornante because there was an alternative, higher bid being offered by privately-owned rival Upper Deck for about $425 million.

ISS pointed out that Upper Deck has no antitrust issues and committed financing, that better profitability lies ahead for Topps and that its stock is trading above its current offer price because of the competing deal.

Topps said in a separate statement that ISS had "missed the mark," saying that the Upper Deck tender offer was conditional and depends on reaching a consensual transaction with Topps.

Topps said it continues to negotiate with Upper Deck, which publishes sports trading cards, but has not yet reached such a deal.

In March, Topps agreed to be bought by Madison and Tornante, which is run by Eisner, for $9.75 per share in cash.

In May, Upper Deck made an unsolicited $10.75 a share, or $425 million offer for Topps. Topps has argued that it wants more clarity over Upper Deck's financing and finalization of any remaining due diligence.

Topps shareholders are due to vote on the Madison/Tornante deal on Aug. 30. The takeover needs the majority of Topps' shares to be voted in favor in order to go through.

Shares of Topps edged down 5 cents to $9.95 on the New York Stock Exchange late Monday afternoon.

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