Topps signs trading card deal with Fanatics-backed Shohei Ohtani.

• Topps has signed an exclusive global trading card deal with Shohei Ohtani, the two-time MLB MVP, which will include autograph and game-used memorabilia cards.
• Topps, acquired by Fanatics for $500 million in 2022, is now focusing on the expanding market for trading cards with its latest effort.
• The Ohtani partnership aims to expand the trading card hobby beyond the US, where Topps sees over 90% of its business.

After signing Lebron James to an exclusive trading cards and collectibles deal, Fanatics' subsidiary Topps has secured an exclusive long-term global trading card agreement with one of baseball's biggest stars, Shohei Ohtani.

The new deal, commencing immediately, will feature autographed and game-used memorabilia cards, with a focus on both U.S.- and Japan-based products. Ohtani and Topps had a partnership dating back to 2018, but it was non-exclusive. Additionally, Ohtani has an exclusive memorabilia partnership with Fanatics, which concentrates on selling autographed collectibles and items such as jerseys and baseballs.

Fanatics has aimed to revitalize the trading card collecting industry since acquiring Topps for $500 million in 2022. The company aims to attract both casual sports fans and investment-driven collectors, with products available at big box retailers like Target and Walmart, as well as rare and unique cards for those willing to pay hundreds of thousands of dollars.

David Leiner, president of trading cards at Fanatics Collectibles, stated that partnerships like the one with Ohtani help "advance the category" and go beyond simply having Ohtani sign cards that will randomly appear in packs.

"Leiner stated that the team's approach with top players in the world goes beyond having them sign 1,000 cards in a hotel room for two hours. Instead, the goal is to bring them in as true partners, promote the products, understand the products, and design products with them."

In 2023, the two-time MVP Ohtani signed a $700 million, 10-year contract with the Los Angeles Dodgers and is currently on track to potentially become the first player in MLB history to hit 50 home runs and steal 50 bases in the same season.

Ohtani's global popularity will aid in expanding the Topps brand and trading cards, as less than 10% of Topps' business comes from outside North America, although it is growing significantly.

In 2020, Topps reported record sales of $567 million, a 23% increase from the previous year. However, the company does not disclose its revenue. This information was revealed as part of a potential SPAC deal that Topps floated in 2021. Unfortunately, the deal was later canceled after Fanatics acquired the MLB trading card rights, which ultimately led to Fanatics' acquisition of the company.

Michael Rubin, founder of Fanatics, added to the growth of the trading card industry, despite larger consumer spending concerns, according to Leiner.

In addition to baseball, Fanatics has secured the rights to distribute trading cards for various sports, including the NBA and NFL in the near future.

Leiner stated that the business is in its best health ever, with growth occurring in all areas, including direct-to-consumer sales, hobby shop sales, retail, and the secondary market.

"Leiner said that Rubin believed we were in the second or third inning when he acquired Topps and that we had a lot more to achieve, and now he has put his money where his mouth is and we are seeing that growth."

In December 2022, Fanatics raised $700 million, bringing its valuation to $31 billion. The company, a three-time CNBC Disruptor 50 company, planned to use the capital on potential merger and acquisition opportunities across its collectibles, betting and gaming businesses. Fanatics was ranked No. 21 in 2022.