MORE ON A-MARK STACK'S BOWERS ACQUISITION

 

A-Mark Precious Metals, Inc., a leading fully integrated precious metals platform, has entered into a definitive agreement to acquire 100% of the stock of Spectrum Group International, Inc. (SGI), the parent of Stack's Bowers Galleries (SBG), one of the world's largest rare coin and currency auction houses and a leading wholesale and retail dealer specializing in numismatic and bullion products, and the majority owner of Spectrum Wine (SW), a global auctioneer, retailer and storage provider of fine and rare wine.

The transaction is intended to complement A-Mark's core bullion business by, among other benefits, increasing its reach into strategically adjacent luxury markets that are expected to offer higher margins and expanded customer bases.

A-Mark will pay $92 million to acquire 100% of SGI's outstanding stock. The consideration will be comprised of 50% cash and 50% A-Mark common stock, with the stock portion valued as of the signing of the definitive agreement. The acquisition is expected to close within 30 days, subject to certain closing conditions, including the approval of SGI's shareholders, the execution of financing arrangements and the consent of A-Mark's lenders.

Spectrum Group International Overview

A-Mark has a long-standing relationship with SGI. A predecessor entity of SGI acquired 80% of A-Mark in 2005 and the balance of the Company in 2011. A-Mark was then spun-off into a separate publicly traded company in 2014. Greg Roberts is the Chief Executive Officer of both A-Mark and SGI, Mr. Roberts and another A-Mark executive comprise a majority of the board of SGI, and several A-Mark board members are shareholders of SGI. A-Mark established a special committee of independent members of its board to negotiate the acquisition on the Company's behalf and to recommend approval of the acquisition.

Stack's Bowers Galleries

SBG was founded in 1933 in New York and has grown to become a global leader in numismatics and bullion operating in two complementary units. The Auction Services unit conducts in-person, internet and specialized auctions of consigned and owned items and has sold a wide range of the most important rarities and numismatic collections over its distinguished history. SBG's Dealership unit maintains a sizeable inventory of rare coins and paper money that it sells as both a wholesaler to other retailers and a Direct-to-Consumer dealer. It also maintains a meaningful bullion inventory and is an important A-Mark trading partner. In addition, SBG complements A-Mark's distribution network in that it works with smaller institutional as well as retail customers. SBG is headquartered in Costa Mesa, California and operates additional offices in the United States, Europe and Asia.

Management Commentary

"Acquiring SGI is a strategic step that significantly enhances A-Mark's position in high-value collectibles," said A-Mark CEO Greg Roberts. "By integrating Stack's Bowers Galleries' expertise in rare coins and paper currency, we are expanding into a bullion-adjacent category that commands higher premiums and stronger margins while also broadening our customer base. Spectrum Wine's focus on premium wines introduces a new revenue stream that complements our business model including Direct-to-Consumer expertise.

"This transaction also creates meaningful cross-selling opportunities as significant synergies exist between A-Mark's Direct-to-Consumer and wholesale customers and SGI's collectors, investors, and dealers. Having led SGI for many years, I am optimistic this acquisition will be financially and strategically accretive to A-Mark."

Brian Kendrella, President of SBG, added: "Joining forces with A-Mark allows us to leverage its financial strength and operational scale to accelerate growth in our auction, wholesale and retail businesses. Access to A-Mark's lending solutions offered by its Collateral Finance Corporation secured lending subsidiary will provide enhanced financing options for consignors and bidders, and cross promotion of our auction and retail listings to A-Mark's Direct-to-Consumer customers is expected to provide a significant opportunity for growth and added value to our auction consignors."

To read the complete press release, see:
A-Mark Expands Product Portfolio into Collectibles by Acquiring the Parent of Stack's Bowers Galleries (https://www.greysheet.com/news/story/a-mark-expands-product-portfolio-into-collectibles-by-acquiring-the-parent-of-stacks-bowers-galleries)

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