The Panini Company purchases Donruss Playoff LP

Story copyright 2009 Beckett Media

By Tracy Hackler | Publisher

ARLINGTON, Texas — The Panini Company on Friday morning finalized its purchase of Donruss Playoff LP following weeks of industry speculation and some furious final days of negotiations.

Financial terms of the landscape-altering acquisition were not disclosed.

In addition to providing the newly named Panini America Inc., a ready-made operating base in the United States, the purchase lends instant hobby credibility to the Italian collectibles giant set to become the NBA’s exclusive trading card manufacturer this fall.

“Acquiring the trading card business from Donruss is very meaningful for a number of reasons,” said Peter Warsop, Panini’s Group Licensing Director. “Panini’s vision of the future is to grow the North American trading card market considerably, and this determination is demonstrated yet again by this acquisition.

“When the announcement was first made that Panini would become the exclusive licensee to the NBA, there was some concern over Panini’s will or ability to maintain and improve product quality, innovation and service to the hobby market. It is significant, therefore, that we demonstrate our commitment to these important disciplines by bringing into our business the level of expertise that currently exists with the Donruss facility.”

To illustrate just how taken Panini was with Donruss, consider that the entire process of a painstakingly complex international business transaction — from first meeting to final signatures — took less than seven weeks.

The deal was expected to be finalized Monday but unforeseen hurdles surfaced late in negotiations that had lawyers and high-level executives from both companies working to complete the transaction well into Thursday night.

Former Sandylion Sticker executive Michael Eisenstein begins immediately as the new North American CEO, and he will run the Arlington, Texas, facility in conjunction with Donruss’ four incumbent vice presidents. In addition, Warsop says that Panini America will also staff up other areas of the company to address the growing needs of the business.

This move is rife with big-picture ramifications, not the least of which is that it almost certainly rescued Donruss from an unsightly alternative in the worst financial climate of the modern hobby era.

“This acquisition signals the continuance of a great heritage built by Donruss,” Warsop said. “The trade would have been a weaker, lesser community without them. It also signals quicker change and recovery from a depressed sector as Panini will now be better situated to grow the category from this firm base.”

Warsop has made it abundantly clear that expanding the trading card industry in this country is of the utmost importance to Panini. And judging by the seismic splashes the company’s made in less than two months, doing it quickly seems high on the priority list, too.

In an action-packed 46 days, the company has gone from a hobby footnote in this country to a hobby force, landing the NBA exclusive in late January and assuming the NFL Properties and and Players Inc licenses previously owned by Donruss.

It’s a sensible expectation that Panini, a company with deep international pockets and grand ambition, won’t be satisfied for long as just a two-sport manufacturer.

“Panini’s plans for the market are well known to the U.S. sport authorities [the leagues and players associations],” Warsop said. “We hope that they take account of them and that our plans will be seen as helpful in developing a growing product category when the licensees are deciding their future licensing strategy. Meanwhile, Panini is focused on giving the best possible service to our present licensors.”

To that end, Warsop, who has openly praised Donruss’ current management, marketing and product development teams, admits that adding to existing staff, and not replacing it, is a process that’s already underway.

“Because we are virtually doubling the size of the business from day one, we will supplement the team with additional specialists where necessary,” Warsop said. “This will affect most areas, and the basketball brand management, prepress and marketing areas will be the most noticeably strengthened.”

This announcement no doubt comes as a relief to those hardcore basketball collectors who’ve spent the last 40 or so days wondering about the future of their hobby. Having an experienced, award-winning product development team at the ready gives Panini the chance to immediately put its best foot forward in the NBA.

Whether or not that foot will include Donruss-branded basketball products remains to be seen.

“All publishing will come under the Panini Brand umbrella and you will also see Panini-branded football series as well as Donruss, Playoff and Score series,” Warsop confirmed. “It is possible that Donruss brands will be utilized on some NBA series, although this has yet to be decided.”

Tracy Hackler can be reached at thackler@beckett.com

Stay tuned to The Beckett Blog and Beckett.com later today for more on this story.