The Panini Company Buys Donruss.....

[DodgerBlue]

Donruss has been for sale for over a year. The company has been mired in debt related to their attempt to launch a new line of TCG’s and toys under the brand name BibleQuest. While their football card product lines have been profitable for years, the failed attempt to expand the company has resulted in a significant build up of debt. The company’s operating revenues have not been sufficient to keep the company running while simultaneously paying down their debt.

Initially, there were three groups in the running to purchase Donruss – Upper Deck, Topps and TCG Digital/4Kids. Throughout 2008, each company at separate times was rumored to be the frontrunner in a race to buy the company. Each suitor had different business reasons for their interest in Donruss. Upper Deck would have eliminated a competitor in football, and, more importantly (in his mind), Richard McWilliam, UD's CEO, would have bought Powell out of the industry. There might have even been a plan to shift part of the Upper Deck’s Carlsbad, CA operations, such as prepress and production, to Donruss’ Arlington, TX headquarters. Purchasing and retaining Donruss as an independently operated entity was discussed hypothetically; the benefit being that UD could maintain two separate licenses with NFLP/NFLPA.

The deal was finalized two weeks ago once the details of the final purchase price and employee retention were worked out between officials from Panini and Ann Powell, former owner of Donruss-Playoff, LP. During the months of December and January it was believed within the industry that Upper Deck would emerge the victor. Negotiations had gotten to the point where a certain member of Upper Deck management reached out to others in the industry to ask about key personnel at Donruss. The prevalent opinion among the folks at Donruss was if McWilliam purchased the company most would lose their jobs and those that retained their jobs would soon wish they had not.

But in the last week of January Panini officials and Powell, not McWilliam, signed a letter of intent, signaling a closed deal was forthcoming. During this time, McWilliam reportedly attempted to spoil the deal by trying to bully Powell into selling Donruss to him, going so far as to fax her a letter of intent with a 12-hour deadline for signing and returning it to him. He also attempted to convince officials at Panini that they would be better off buying Upper Deck rather than Donruss. I am sure this will not be the last time McWilliam attempts to sell Upper Deck in the foreseeable future given the fact that the company’s revenues have dramatically diminished during the past 6-12 months due to the economy and the losses of the Yu-Gi-Oh and NBA licenses.

This purchase will prove to be a tremendous coup for Panini. It is a win on several levels. Panini acquires a company with a solid stable of product lines, an outstanding operational system and a quality personnel group. Had Panini chosen to start up a U.S. office from scratch, they would have faced an uphill battle getting products ready for distribution by October. It would have been an organizational nightmare trying to build products while also trying to build a company from the ground up. With this purchase, they are buying into a company that is fully operational and that has already proved it can handle the production of additional trading card products.

This should be very interesting. Donruss had established its stable of football products as the best in the industry. I just hope Panini realizes that....if it ain't broke don't fix it! The game is about to change folks!

[DodgerBlue]

Both sides are trying to play this off. Officials from both Panini and Donruss are denying the reports. I expect an official announcement within the next couple of weeks.

[Geebi]

IMO Donruss is the king of cards. If they did sell out I hope nothing changes in their line of products.

[GordonJrFan]

i dont like Donruss' card styles.

[DodgerBlue]

Deal has now been confirmed.

[Geebi]

Originally Posted by GordonJrFan

i dont like Donruss' card styles.

What is not to like, they offer the best cards for the money without having to spend 200 a pack on. Leaf Certified Materials has about as nice of cards as Exquisite and for a heck of a lot less. JMO though.

[DodgerBlue]

I just read an interview with the head of Panini and he sounded as though it would be business as usual in the company. They are retaining many key Donruss personnel to help with the integration of the two companies. He did say that we would still see products produced under the Donruss brand names: Donruss, Playoff, and Score with the possible exception of Leaf. I hope that doesn't signal an end to Leaf Certified, Leaf Rookies & Stars, and Leaf Limited.

[jp39]

Originally Posted by GordonJrFan

i dont like Donruss' card styles.

I thought the 2008 score football cards were pretty cool

[DodgerBlue]

Donruss football products account for about 60% of my total pack/box sales. It would be a travesty if many of the great Donruss brands are scrapped for new unproven products. Playoff Prestige, Donruss Elite, Donruss Classics, Donruss Threads, Playoff Contenders, Leaf Rookies & Stars, Leaf Certified, Leaf Limited, and Score Select are all good sellers for me.

[selby92]

I love the Leaf R&S, and probably my favorite product from Donruss is Absolute.