Greg Manning Auctions (NASDAQ:GMAI)
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Greg Manning Auctions, Inc. (Nasdaq: GMAI) announced
today it has acquired the outstanding shares of A-Mark Precious
Metals, Inc. (APM), one of the largest private sellers of bullion
coins and bullion gold, silver and platinum to the wholesale
marketplace. Sales for APM's 2005 fiscal year ending July 31, 2005 are
projected to be approximately $2.5 billion, with pre-tax income for
the same period estimated at $2.0 million.
APM is a full service precious metals trading company offering a
wide array of products and services on a global basis. As one of only
six U.S. Mint authorized purchasers of gold, silver and platinum Eagle
coinage in the world, A-Mark sources these products directly from the
U.S. Mint to A-Mark's wholesale clientele. In addition to the U.S.
Mint, APM also has distributorships with other countries' mints,
including Canada, Australia and China. Clients of APM include coin
dealers, banks, financial institutions, jewelers, collectors,
investors, manufacturers, as well as other mints and mines.
Greg Manning, First Vice Chairman, CEO and President of GMAI,
stated, " The acquisition of A-Mark positions our company as one of
the largest rare coin and precious metals dealers in the country. Our
wide range of product and services, including wholesale, live
auctions, Internet auctions and retail, makes us the premier
one-stop-shop in the coin industry. Combined with APM purchasing coins
directly from the U.S. and other world mints, GMAI has an enhanced and
diversified customer base with the resources and financial strength
necessary for long-term success."
"Clearly, this acquisition will have a profound impact on the
overall size and scope of our company, particularly our coin division
- Spectrum Numismatics," Manning added. "We expect GMAI's aggregate
sales to increase from a forecasted $300 million in fiscal 2005 to
$2.8 billion in fiscal 2006."
The acquisition, which closed July 15, was an all-cash deal
totaling approximately $20 million. GMAI and Afinsa Bienes Tangibles,
S.A. of Madrid, its majority shareholder, were partners on the
transaction, with GMAI acquiring 80% of the outstanding common stock
of APM and Afinsa acquiring the remaining 20% interest through a
wholly owned subsidiary. A-Mark will maintain its existing $50 million
syndicated line of credit, thus providing a seamless transition of
financing under GMAI, and will fall under the management of GMAI's
Spectrum Numismatics.
Greg Roberts, CEO of Spectrum and new Chairman and CEO of A-Mark,
stated, "This acquisition will have a significant impact on our coin
division by way of incremental top-line growth with the ability to
expand APM's profits through the additional sales venues that Spectrum
can provide. Currently, APM buys and distributes over 50% of the gold
minted each year by the U.S. Mint; penetration in this new field opens
up many possibilities for Spectrum to market new products on behalf of
its clients." Roberts continued, "We are confident APM will
immediately benefit GMAI's current fiscal year and beyond. In
addition, we believe that APM's $50 million line of credit strengthens
our financial position as we move forward with our growth plan."
Steven C. Markoff, former Chairman and CEO as well as founder of
APM, stated, "Based on the strong relationships I have built with Greg
Manning and Greg Roberts over the years, in addition to their leading
industry reputations, Greg Manning Auctions was a strategic fit when
the decision was made to sell APM. Spectrum's intimate knowledge of
the numismatic and bullion marketplace, combined with our existing
client base, provides a number of synergies that can be realized
almost immediately. While it is difficult to sell a company that I
have founded and chaired for more than 40 years, I am confident the
resources available at GMAI will only enhance A-Mark and enable it to
achieve even greater success in the future."
Mr. Markoff has agreed to remain with the company on a
consultative basis. Mr. Markoff will also continue as director and
minority owner of Goldline International, Inc., one of the largest
retail sellers of rare coins to the investing public and longstanding
customer of A-Mark and Spectrum.
Esteban Perez, Chairman of GMAI, commented, "A-Mark Precious
Metals has set the world class standard in the coin industry for
customer service and attention to detail critical in a business of
this magnitude. This acquisition, combined with our existing 17
operating businesses, solidifies our position as a leading vertically
integrated company serving the distribution, wholesale and retail
collectibles market. We continue to demonstrate our ability to
strengthen our competitive position and expand our global reach
through the integration of strategic acquisitions, and drive future
performance."
Juan Antonio Cano, Chairman of Afinsa, stated, "On numerous
occasions I have stated that the position of 'Grupo Afinsa' as the
majority shareholder in GMAI is in keeping with our long-term vision
to assist in building a global collectibles company setting the
highest standards in every area of collectibles that the company
enters. This has been our vision since the founding of Afinsa 25 years
ago. With the acquisition of A-Mark, GMAI clearly has become a world
leader in the collectibles field serving a broad, worldwide range of
collectors, investors and professional dealers.
"We consider the purchase of A-Mark with Afinsa participating as a
minority financial partner benefits all shareholders by way of an
all-cash transaction that avoids any dilution of GMAI shares. This
template may be used in future acquisitions and will allow GMAI to
consider the acquisition of other important companies. We are
committed to GMAI's vertical growth strategy and the company's
worldwide expansion through synergistic acquisitions," Cano concluded.
About Greg Manning Auctions, Inc.
Greg Manning Auctions, Inc. is a global collectibles merchant and
auction house network, with operations in North America, Europe and
Asia, and on the Internet. This network was created in September 2003
when GMAI and Auctentia, S.L. effectively integrated their auction
businesses, creating a GMAI-AUCTENTIA global collectibles auction
network.
In North America, GMAI is a leading traditional and e-commerce -
Internet, interactive telephone, Internet and live simulcast -
auctioneer and merchant/dealer of collectibles. Coins, stamps and
sports cards are offered at www.gregmanning.com and www.teletrade.com.
Its operations include the Greg Manning Auctions division, Ivy &
Manning Philatelic Auctions, H.R. Harmer of New York, Greg Manning
Galleries, Spectrum Numismatics, Teletrade, Nutmeg Stamp Sales, John
Bull Auctions, Ltd. in Hong Kong, Superior Sports Auctions, Bowers &
Merena Auctions, North American Certified Trading and Kingswood Coin
Auctions.
In Europe, the leading auction houses affiliated with the network
are Auctentia Subastas of Madrid, Spain (operating under the name
"Afinsa Auctions"); Corinphila Auktionen of Zurich, Switzerland (65%
owned by GMAI); and the Koehler group of auction companies of Berlin
(66.67% owned by GMAI) and Wiesbaden, Germany.
GMAI also owns GMAI Auctentia Central de Compras (CdC) of Madrid,
Spain, which is engaged in the sale, marketing and production of owned
and third-party collectibles, with an emphasis on specialized
philatelic material.
Both GMAI and CdC currently act as exclusive supplier of
collectibles - primarily stamps and coins - on a worldwide basis to
Afinsa Bienes Tangible, S.A. of Madrid, Spain, one of the world
leaders in marketing tangible investment products, and GMAI's majority
shareholder.
Statements in this press release that relate to future plans,
objectives, expectations, performance, events and the like are
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 and the Securities Exchange
Act of 1934. Future events, risks and uncertainties, individually or
in the aggregate, could cause actual results to differ materially from
those expressed or implied in these statements. Factors that may cause
such differences include changes in market conditions, changes in
economic environment, competitive factors and the other factors
discussed in the "forward-looking information" or "risk factors"
sections included in GMAI's filings with the Securities and Exchange
Commission, including GMAI's Annual Report on Form 10-K, Quarterly
Reports on Form 10-Q, prospectuses and other documents that GMAI has
filed with the Commission. In particular, any statement related to
GMAI's expected revenues or earnings or GMAI's being well positioned
for future profitability and growth are forward-looking statements.
The words "should," "believe," "estimate," "expect," "intend,"
"anticipate," "foresee," "plan" and similar expressions and variations
thereof identify certain of such forward-looking statements, which
speak only as of the dates on which they were made. Additionally, any
statements related to future improved performance and estimates of
revenues and earnings per share are forward-looking statements. GMAI
undertakes no obligation to publicly update or revise any
forward-looking statements. Readers are cautioned not to place undue
reliance on these forward-looking statements.