An investment firm backed by Roy Disney is urging directors of Santa Ana-based Collectors Universe Inc. to put the collectibles authenticator up for sale.
In a letter to Collectors Chairman Clinton Allen, Burbank-based Shamrock Capital Advisors Inc. said it believes the company could be worth twice as much if it were put up for sale.
Collectors, which authenticates and grades coins, sports cards, stamps and other collectables, has a market value of about $30 million.
The company shares are off about 60% in the past year.
“We believe the company’s core business of providing value added authentication services is an attractive business and far more valuable than implied by its current stock,” Shamrock said in its letter.
Shamrock, which invests money for Disney and relatives, owns nearly 9% of Collectors through an activist value fund.
Disney is the nephew of Walt Disney Co. founder Walt Disney and a former executive with the company.
Shamrock said it believes Collectors “is an attractive acquisition candidate” and directors should abandon the company’s “flawed strategic direction.”
Collectors, a small company with yearly revenue of about $40 million, could save money by no longer having to comply with regulations related to being publicly traded, the letter said.
Shamrock called the company’s history of the past few years a “litany of lost opportunities, frequent changes in strategy, near delisting from Nasdaq, incurrence of a series of operating losses, and the board’s pathetic recent adoption of a poison pill” to prevent unsolicited takeovers.
The investment firm called Collectors’ profit track record “simply dismal.”
For the December quarter, Collectors posted an operating loss of $2 million, narrowed from $2.6 million a year earlier.
Revenue was down 10% to $8.1 million.
Collectors went public in 1999.
The company was started by David Hall, who began selling rare coins as a 12-year-old on the streets of Santa Ana.
Hall is the company’s president and a director.
