Jay-Z and Blackstone Acquire Certified Collectibles Group (CCG)

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Certainly and deservedly, the Goldin/Collector's Universe news reported here a day ago was the talk sweeping the Collector's market yesterday. What may have been overlooked a bit is a massive deal that was announced shortly before the Goldin acquisition. That was the sale of a majority stake in CGC (the market leader in graded comics) and their parent company CCG to a group of investors led by Blackstone Tactical Opportunities and including Jay-Z's Roc Nation, Michael Rubin of Fanatics, Daryl Morey, the Director of Ops for the 76ers and NBA star Andre Igoudala among their investment group. The sale puts a valuation of the company at $500 million. 

Blackstone is one of the world's leading investment firms with over $649 billion in holdings. Blackstone's C.C. Melvin Ike said of the acquisition: "As thematic investors, we look for exceptional entrepreneurial teams succeeding in growing markets, and CCG is a great example. We have been closely following the rise of the global physical and digital collectibles industry for several years and we were drawn to CCG because of their leadership role in the categories that they serve, and Blackstone’s ability to grow the platform through both organic and inorganic initiatives. We look forward to working together to help the company continue and even accelerate its impressive growth trajectory." Blackstone stated that they intend to leave CCG's leadership in place. The deal seems to be mostly predicated on Blackstone providing resources to develop CCG's existing and future verticals. 

CCG is a company with diverse holdings in the graded collectible space with offerings in sports cards, TCGs, paper money, coins, stamps, magazines, posters and comics. The sale undoubtedly has more to do with the business overall and, most likely, its move into sports cards with CSG (CCG's sports card grading brand), rather than it having to do with comic book grading with CGC, judging by the investors brought into the brand. Nonetheless, with CGC a market leader in the comics space, this will certainly have an effect on the comic market as a whole.

The overall response from the comic collecting community when news dropped yesterday was anything but positive. Most viewed the deal as being a big group of outside investors who will now raise prices to reach profitability, while others viewed the deal as being sports motivated and are now worrying that comics could be adversely affected by any potential policy or pricing changes by CGC. Others worry that outside investment into space is an indication of a bubble.   Some professionals in the market saw it as continued validation for the collector market. 

For me, as a comic investor, I see these moves as a positive sign that the collectibles market continues to be red hot. It feels like every few weeks there is breaking news about a new company or investment group entering the collectibles market. All of it hopefully results in more exposure and an overall rise in value of the comic market as a whole. To collectors and investors who have trepidations about the sale, the beautiful thing is you have options. CBCS, owned by Beckett Media, has been narrowing the gap in secondary market value and market share over the last several months and provides a clear choice as an alternative to CGC. 

The comic market, like many collector markets, has become dependent on grading for solidifying the value of a collectible and maximizing its return at the time of sale. With so much at stake, it will be interesting to see how this new development shakes out. For my part, I will continue to view the market with a bullish nature and positive outlook. 

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