Monarch Services Inc (MAHI)

[LouisDesyjr]

Clean shell

While it IS possible for this company to be sold as a clean shell, I do not think that is going to happen.

While people can look up more of the history of the company, here is a short summary of what I remember:

1: Company, Monarch Services, was a publishing company in the 1960s and a little earlier.

2: Company had a customer, Avalon Hill, that used it to print its boardgames, commonly known as wargames. Avalon Hill was run by a guy named Charles Roberts.

3: Avalon Hill ran into financial trouble and was unable to pay Monarch Services, so Monarch services took over Avalon Hill for the money owed. This was pre 1970.

4: Boardgames and wargames started to grow in popularity in the 1970s and 1980s. With that a large part of Monarch Services business became printing games for its Avalon Hill Division. Many games did very well and sold in excess of 100,000 copies.

5: At the height of wargamming it was estimated that 1% of the population had played a wargame. Of that amount the split seemed to be about 99% men and 1% women. The thinking on that split is that the games appealed to people who had an interest in politics, history and economics. There was also a heavy presence from various professions like computer science, e3nginering and government or military professionals.

6: Wargames and Board games declined in the 1990s and 2000s due to the rise of role playing games, computer games and the internet.

7: During the 1970s and 1980s the company did well, and I think, even at one point paid a dividend for several years.

8: In the 1990s the company started to have problems as computer games gained market share. While the company had several computer game programs that were very good, it was not enough to offset the decline in overall game sales. The company did try some games aimed at the popular market but those only had limited success and were not enough to offset the losses in other areas.

In the good times the decision on a print run for a game was if they should do a run of 5,000 copies or 10,000 copies. In later years, late 1990s, according to what I could tell, no wargame company was doing print runs of more than 3,000 copies and even those were taking time to sell out. There are even some reports of some companies in the 2000s doing wargame print runs of as little as 250 copies of a game.

9: The company also tried to expand into other areas. They had a Boys Life magazine, I think also published Girls Life, a Tobacco shop, a line of plush toys for infants; but none of these areas worked. At best the efforts broke even and at worst added to the losses.

10: In 1998, without any warning, the company sold off its entire game line and IP to Hasboro for something like $8 million around August 1998. The flagship magazine, The General, stopped publication. While Monarch Avalon still existed, it now was nothing but a shell with a pile of cash and no debt.

11: Shareholders expected and hopped for a distribution of the profits from the sales of Avalon Hill and its IP, but management decided instead to try a few more business lines. The company bought 18 acres in a county near Baltimore to run catered events, like birthday parties and weddings. As it turned out, there was not really enough demand and the company lost money every quarter.

12: Around this time, 2000 or 2003 or so, and for a few years, there was a proxy fight with a guy named A J Sutton. He and a few other shareholders tried to get the company to pay out some/most of the cash instead of losing money on trying a new business. They were not able to win because the officers had 30% of the shares and able to retain control.

13: Finally, the company and officers decided to pay a liquidating dividend of $0.62 per share. That took place on March 2, 2010.
https://www.sec.gov/Archives/edgar/data/202685/000020268510000002/aoy.txt

The company also filed to de register and stop filing reports with the SEC.

At that point I thought the company was dead, but its corporate charter was kept going. But in 2016 it was admin dissolved so it looks like the company was finally gone BUT with the company filing to revive the corporate charter yesterday, the company is in existence but it looks like there are no operations and no assets.

While the company is a 'clean shell' it looks like there is no interest of them wanting to sell it to anyone. While in theory someone could buy a majority of the shares and force that, that would probably take a lot of time and money to do. So I can't see that would be worth it, plus even if it worked it could take years to do.

Louis J. Desy Jr.