The rarest U.S. stamp is going up for auction. It's expected to sell for millions

Only one of the one-cent Z-grill, the rarest US stamp, is available to private collectors. When it goes up for auction in June, it could sell for millions. (Robert A. Siegel Auction Galleries via CNN Newsource)

Here's something for serious stamp collectors only. This summer, philatelists will have a chance to snag the rarest U.S. stamp ever: the 1868 one-cent "Z-grill."

Interested? It'll cost you (more than) a pretty penny.

On June 14, the one-cent Z-grill will be put up for sale by Robert A. Siegel Auction Galleries, marking the first time the rare stamp has been on auction since 1998. Experts from the New York auction house say it could fetch four to five million dollars, which would make it the single most expensive U.S. stamp ever sold. (It's surpassed internationally by the British Guiana One-Cent Magenta, which sold in 2021 for US$8.3 million.)

The reason for the exorbitant cost is simple. Of the two known copies of the one-cent Z-grill, one is held by the New York Public Library. That leaves only one one-cent Z-grill available to private collectors. Since 2005, the coveted stamp has belonged to billionaire investor and "bond king" Bill Gross.

"It's considered the trophy of collecting United States stamps," said Charles Shreve, who has managed and built Gross' extensive stamp collection for years and serves as director of international auctions at Robert A. Siegel Auction Galleries.

"There's only one. If you want to brag, that's the stamp."

What's so special about a Z-grill

To the untrained eye, the blue one-cent Z-grill, which depicts the nation's first postmaster general Benjamin Franklin, looks like any old stamp. What's distinct about it is the waffle pattern embossed in the paper, also known as a Z grill.

The detail has a fascinating history. After the Civil War, the U.S. Post Office "developed an irrational fear" of people cleaning and reusing stamps, which in turn would contribute to a loss of revenue, Scott Trepel, president of Robert A. Siegel Auction Galleries, told CNN.

One of the ways they sought to prevent stamp fraud was through a technique called grilling, which created a pattern of small indentations in the surface of the paper. Once the stamp was cancelled, the ink would seep through those indentations into the stamp, making it difficult to reuse. The Z grill, while uncommon, was one of several grilling patterns.

"Does it look like a lot of other cheap stamps? Yeah, on the face of it, it looks like a common stamp," Trepel said. "But that grill is what makes it so important."

A lot of lore behind it

The one-cent Z-grills were produced in 1868. According to Trepel, this particular one was discovered in 1916 and reemerged in 1957. The stamp came on the market in 1975, selling for US$42,500, and again in 1977, this time selling for US$90,000, according to the auction house. Eventually, it was acquired by Los Angeles Lakers owner Jerry Buss, who sold it in 1986 for US$418,000.

The one-cent Z-grill came up for auction once again in 1998.

Gross, co-founder of the Pacific Investment Management Company (PIMCO) and a lifelong philatelist, had enlisted Charles Shreve to help him assemble a complete collection of every single stamp issued by the U.S. Postal Service.

He got his hobby from his mother, who started collecting stamps when Gross was a child. According to Shreve, she believed they would increase in value and yield enough money to pay for his college education.

When the collection proved worthless, Gross couldn't forget the dejected look on his mother's face. So he set out to prove her theory.

"When he started to make money, he said to himself, 'I'm gonna prove that my mother was right buying stamps. She just bought the wrong ones,'" Shreve said.

The one-cent Z grill was one of the last stamps Gross needed to realize his goal, but he ultimately lost the 1998 auction to fellow stamp collector Don Sundman, Shreve said.

In 2005, Gross finally acquired the one-cent Z-grill by purchasing a block of Inverted Jennies for US$3 million and trading it to Sundman for the prized stamp, finally completing his collection.

Once Gross had completed that goal, he ventured into collecting other rare stamps before eventually losing interest. He started selling some of them in 2007, but hung onto his beloved collection of U.S. stamps until about 2017, when he told Shreve he was ready to sell that too.

The entire collection is estimated to be worth US$15 to US$20 million. The top 100 stamps from the collection will be auctioned off on June 14, while the remaining stamps will be sold on June 15.

"There's multiple stamps that'll bring US$500,000 or US$750,000, but the (one-cent) Z-grill is the star of the show," Shreve said. "I just know some people who are lusting for it, and we want to try to get as many people interested in it as possible."