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| July/August 2006 |
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American Gemological Laboratories Sold American Gemological Laboratories (AGL), one of New York’s oldest gem trade laboratories and one of two dedicated primarily to colored gemstones, was sold August 21 to Collectors Universe Inc. AGL President C.R. “Cap” Beesley, who founded the laboratory in 1977, will continue to run the lab. “I never really dreamed or imagined that I would be taking this particular route,” he said. But when Collector’s Universe approached him at the end of 2005, he found the promise of additional funding difficult to resist. “We’re going to have a whole new depth of personnel and resources that haven’t historically been available [to us].” The acquisition price for AGL was $3.5 million in cash, with contingent payments of up to $3.5 million more over the next five years. Collectors Universe is a publicly traded company which specializes in certifying the authenticity of all types of collectible merchandise, including coins, stamps, trading cards, and autographs. In 2005, the company made its first move into the jewelry market with its acquisition of the Gem Certification and Assurance Lab (GCAL), which primarily does diamond certifications. That purchase, along with AGL, is part of the company’s plan to expand into what it considers an untapped market. “The fundamental question a consumer has is, ‘How do I know this hasn’t been repaired, replaced, ore messed with?’ We know that the answer to this question directly related to how much they’ll write the check for. In colored gemstones, all the consumer has to rely on is [the seller’s] warranty for the gemstone,” said Michael Haynes, CEO of Collectors Universe. “Most luxury markets in the last 12 months were up 20 to 25 percent,” he continued. “Jewelry is up 3 to 5 percent. Most of the markets we’re in, we’re outpacing [the average luxury market growth]. We want to bring that kind of intensity to the jewelry market.” Nor will they necessarily stop with AGL and GCAL. “We’re in the business to increase, and we have tens of millions of dollars to go do that. Just because we’ve made an acquisition in diamonds and one in gemstones doesn’t mean that we’re done.” Beesley said that the plans for AGL include expanding the staff at the laboratory and investing in new equipment. He wants to develop faster processes for detecting organic fillers -- particularly when used to treat emeralds -- and better ways to detect light-element diffusion such as beryllium diffusion in sapphires, among other things. “There’s not going to be any shortage of things to do.” However, despite the changes, AGL will still be open for business as usual. “AGL stays in place, and it’s AGL you’re dealing with,” Beesley concludes. “The submission process is the same, and processing is the same. We’re just a wholly-owned subsidiary of Collectors Universe.”
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