NGC acquired by Blackstone

Boosibri

https://www.businesswire.com/news/home/20210701005601/en/Blackstone-Tactical-Opportunities-to-Acquire-the-Certified-Collectibles-Group-a-Leading-Provider-of-Tech-Enabled-Authentication-Grading-and-Conservation-Services-for-the-Global-Collectibles-Industry

TurtleCat

A lot of changes with the big 2 in slabs this year. I wonder how it will play out in years to come? Perhaps there will be a sea change of sorts coming on the horizon?

ricko

Very interesting... There will likely be changes in operations in the near future. Cheers, RickO

dbldie55

Just got the email as well. Be interesting to see where all of this goes.

Yorkshireman

I work at a major investment firm and talk to Blackstone people often.
That is very interesting news.

fastfreddie

They'll be some pencil sharpening going on for sure.

BryceM

Hmmmm. I think sooner or later we'll see some innovation. An occasional shakeup is inevitable - gotta keep those submissions coming in. 100 pt grading scale? Something else? Who knows.

fastfreddie

How about a dual holder combining grades from both services (graded independently) and a window to insert the sticker if warranted.

pmh1nic

I really never really thought of collectibles as an “asset class” but I guess at some level, significant collections of very rare coins, art, baseball cards, cars, etc. they legitimately are an asset class.

amwldcoin

Hmmm My stock Broker just liquidated my Blackstone Holdings!

dmwest

100 pt scale along with obv/rev individual grading

Connecticoin

Maybe Andre Iguodala will grade coins once he retires from the NBA

MsMorrisine

private equity likes debt.

I hope they don't debt up a slow growing company

291fifth

Did they spot a cash cow to milk?

MrEureka

Lots of upside if they can break into the sports card market. I just hope they don’t lose too much interest in the coin biz.

Boosibri

@MsMorrisine said:
private equity likes debt.

I hope they don't debt up a slow growing company

That is a very 1980’s PE model

thefinn

From experience, what usually happens when money flows into businesses that rely on producing or ensuring the quality of a product, the ability to do so lessens, and the profit incentive becomes the dominant concern. No more, "the customer is right" because the new customer is the share holder.

AlexinPA

Meet the new boss same as the old boss......

Tetromibi

@BryceM said:
Hmmmm. I think sooner or later we'll see some innovation. An occasional shakeup is inevitable - gotta keep those submissions coming in. 100 pt grading scale? Something else? Who knows.

They can’t keep up with demand as-is. Maybe some pricing adjustments and some other things to increase efficiency.

Crypto

I am surprised it has taken this long for the market to do a feeding circle around these (entrenched) high cash flow-low overhead based consumable product companies. I was always amazed at the low CLCT prices historically considering they were a high dividend company. Under the radar no longer

pruebas

I think it’s a bad thing for the average guy when big money gets involved with anything.

You know they are chasing big returns or they’d be in more liquid investments. Big returns for them means higher fees for us.

And private equity doesn’t have the best track record of investing in their businesses.

DrDarryl

https://bloomberg.com/news/articles/2021-07-01/blackstone-buys-stake-in-certified-collectibles-joined-by-jay-z

Blackstone said its tactical opportunities group is purchasing a majority stake, valuing the business at more than $500 million. Other investors include Roc Nation, Jay-Z’s entertainment company, and Daryl Morey, president of basketball operations for the Philadelphia 76ers.

Certified Collectibles founder Mark Salzberg and Chief Executive Officer Steven Eichenbaum will retain a significant minority stake.

MsMorrisine

$500 Mil?

Will everyone get a raise?

ShaunBC5

@DrDarryl said:
https://bloomberg.com/news/articles/2021-07-01/blackstone-buys-stake-in-certified-collectibles-joined-by-jay-z

Blackstone said its tactical opportunities group is purchasing a majority stake, valuing the business at more than $500 million. Other investors include Roc Nation, Jay-Z’s entertainment company, and Daryl Morey, president of basketball operations for the Philadelphia 76ers.

Certified Collectibles founder Mark Salzberg and Chief Executive Officer Steven Eichenbaum will retain a significant minority stake.

Beyoncé owns NGC. Looking at raw Saints like “all the single ladies, put your hands up!” And your damaged coins like “if you liked it then you shoulda put a slab on it!”

(To tie this up for some, those are lyrics from a song, except I used “slab” instead of ”ring” and Beyoncé is married to Jay-Z)

291fifth

@MsMorrisine said:
$500 Mil?

Will everyone get a raise?

I hope they aren't holding their breath waiting for one.

johnny9434

@MsMorrisine said:
$500 Mil?

Will everyone get a raise?

Yes like it or not

JohnnyCache

Perhaps they see straight up growth in this area.
When there are fears of inflationary pressure people look to many other baskets to put money into.
So maybe they think people will be spending more on collectable items.
Then there is the possibility of the new owners greatly expanding the business of certifying other collectable "things" which can add revenue streams. Then there is growth and expansion of collectables in other world markets such as what was seen and discussed recently right here in this thread. Or maybe it's some combination of several things including the things above.

Edit to fix thread error

Connecticoin

@MsMorrisine said:
$500 Mil?

Will everyone get a raise?

Just Salzberg and Eichembaum - to their bank accounts.

Kove

Either Blackstone sees tremendous growth for NGC, or they will tighten the screws and get returns everywhere they can. I hope it's the former.

I do find it interesting that this Blackstone investment in NGC is happening at the exact same time that PCGS' president is leaving for greener pastures elsewhere.

AMRC

Or perhaps the maturity of the market is finally being realized. i.e. Luxury Assets

WCC

@pmh1nic said:
I really never really thought of collectibles as an “asset class” but I guess at some level, significant collections of very rare coins, art, baseball cards, cars, etc. they legitimately are an asset class.

I'd describe your description as part of someone's portfolio, not an asset class.

WCC

@JohnnyCache said:
Perhaps they see straight up growth in this area.
When there are fears of inflationary pressure people look to many other baskets to put money into.
So maybe they think people will be spending more on collectable items.
Then there is the possibility of the new owners greatly expanding the business of certifying other collectable "things" which can add revenue streams. Then there is growth and expansion of collectables in other world markets such as what was seen and discussed recently right here in this thread. Or maybe it's some combination of several things including the things above.

Edit to fix thread error

If Blackstone bought CCG based upon the prospects of world coin grading, I'm predicting a huge disappointment.

bidask

@Kove said:
Either Blackstone sees tremendous growth for NGC, or they will tighten the screws and get returns everywhere they can. I hope it's the former.

I do find it interesting that this Blackstone investment in NGC is happening at the exact same time that PCGS' president is leaving for greener pastures elsewhere.

Interesting point.

Blackstone is the world’s largest private equity firm …. symbol BX.

pmh1nic

@WCC said:

@pmh1nic said:
I really never really thought of collectibles as an “asset class” but I guess at some level, significant collections of very rare coins, art, baseball cards, cars, etc. they legitimately are an asset class.

I'd describe your description as part of someone's portfolio, not an asset class.

Blackstone has other ideas. They describe this collection of stuff as an "asset class".

3keepSECRETif2rDEAD

…Nice, a Blackstone is what my personal chef uses to cook sea creatures for me on

keyman64

@3keepSECRETif2rDEAD said:
…Nice, a Blackstone is what my personal chef uses to cook sea creatures for me on

Lol, that's a different Blackstone.

derryb

Wall St. finally sees $'s in collectibles. A good sign for collectors.

Elcontador

They tried to commercialize numismatics in the mid 1980s. Big run ups in Gem common date Morgans and Walkers. It didn't end well.

I can see the big fish trying to convince the uber wealthy that owning expensive coins is like owning expensive art.

Relating to this, I thought Heritage owned a piece of NGC. Is this still the case?

Redglobe

Collectables such as coins and trading cards are a strong trend right now and they are buying into that trend.

MsMorrisine

Strong trend or buying at the top?

Redglobe

I would say strong trend...wouldn't guess about buying at the top since it was a private company (NGC) I think.
Isn't NGC private previous to this

jessewvu

I’ve never been a customer of NGC and haven’t heard of the other company. Good for them?? 🤷‍♂️

Redglobe

Where shares involved or just an equity infusion with majority ownership

jessewvu

@derryb said:
Wall St. finally sees $'s in collectibles. A good sign for collectors.

My guess is someone’s trying to make a play in the sports card arena. That’s a hot hot hot hot market and rising right now. It’s a guess

DelawareDoons

I bet their play is to streamline, increase profits, and go public.

SilverProofQuarter1883

Hope they take good care of NGC, I have heard horror Stories of companies buying other companies and then the company fails. Hope Blackstone keeps its promise of innovation and growing NGC. NGC is great and I hope it stays great.

bidask

@Elcontador said:
They tried to commercialize numismatics in the mid 1980s. Big run ups in Gem common date Morgans and Walkers. It didn't end well.

I can see the big fish trying to convince the uber wealthy that owning expensive coins is like owning expensive art.

Relating to this, I thought Heritage owned a piece of NGC. Is this still the case?

I think it is .

Boosibri

Blackstone is generally a good strategic partner in my experience.

Goldminers

Future Collectable ETF?

TurtleCat

All I can say is working for a PE is very different from other funding sources. It’s all about the EBITDA.

WCC

@Goldminers said:
Future Collectable ETF?

If so, it will be a small one.