31
2011
Mets Seek $200 Million For Portion Of The Team
An article by Former Writers
Yes, that’s the headline in the morning Sports Pages in the New York papers.
And so the saga continues, while the Wilpons and Katz et.al keep saying that everything is OK, they are playing with funds that belong to everyone they know, even their wives. That’s not going to turn out well.
Apparently the $200 million will give them a cash flow, and the lender nothing. Even in the future there will be no pathway to acquire the rest of the team.
The team lost around $50 million in 2010 – which the Wilpons are blaming on ticket sales – is that possible? It’s statements like these which make the whole financial issue not ring true to me. Is this any way to run a business?
The team doesn’t need the permission of its’ partners to sell a substantial part of it’s network SNY and they may be forced to do that as well. Why have a network of your own in this case?
This saga has taken on the feeling of a day-time soap opera, that’s why I’m glad real, live baseball begins today.
Play Ball.
About the Author: Former Writers
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I’m glad the Mets season start tomorrow as well.
Then maybe we can get a break from reading about ownership and $$ issues day after day.
Nah, I’m sure Annie as the rest of the media will make sure to keep everyone abreast about the situation. How can they not? It’s Met news.
I agree with Jersey on this one, it’s actually really relevant news.
A change in ownership could go a long way in let’s say, keeping Reyes or trading him in the middle of the season because they know they won’t have the money to offer him.
As much as I wish it wasn’t it really is relevant. Though I don’t care so much for the day to day drama of it. Let me know when something of significance actually happens. Me knowing that the Mets would consider selling a percentage of something is not something I care to read unless they actually do it.
Still I understand others like reading that stuff so to each his own.
Ignore the lower comment, this reply was meant here
“It is particularly boring compared to actual baseball.
I wish they could just get it over with so the only thing we needed to focus on is real baseball – on the field, etc.”
like i said below, first we need the real baseball to start to provide the distraction!
also, other than the madoff/money stuff, this was really a quiet ST for the Mets, with the inevitable castillo and ollie releases dominating the discussion.
I don’t like it, but the sad fact is it’s WAY more relevant than who plays LF tomorrow night.
Mrs. Wilpon and Mrs. Katz could somehow wind up owning this team. Anyone remember Lorinda? Those were bad times around here. This whole issue effects the team in so many ways, not just this year but for many years down the road.
Does anyone really believe that that Wagner was traded for Lora, a now 22 year old first basemen who hit .088 in the rookie App League in his 4th professional season and Chris Carter who makes Daniel Murphy look like Ozzie Smith?
No, Wagner was traded to save salary (2M), his buyout (1.5M) and the cost of the signing bonus the two draft picks would have gotten. (2 M Approx). All told the Wilpon had Omar “sell” those two prospects even though we have so many holes to fill every year.
Who here can name another NL GM who would trade the 20th and 38th picks in the draft for a 1B with 34 extra base hits in 3 rookie league seasons as a professional and a designated hitter?
C’mon, this has been going on for a long time.
Jersey and Satish – Thanks for the comments – of course this stuff is big time, otherwise it would be in the National Enquirer instead of the Times and the Wall Street Journal. I guess that there are more than a few Mets fans who don’t understand the business part of the team off the field.
You already know from past conversation my take on all this.
Don’t know what you are trying to say when you say you “guess that there are more than a few Mets fans who don’t understand the business part of the team off the field”.
I don’t know why would or should many fans know the business part of the team off the field. We have so many so called experts in the media already professing to know about the business end of baseball contradiction each other.
Like I said I don’t need the day to day drama of people saying what they think will happen but I understand that others may need it and so to each his own. But for me I will let the so-called professionals that know about the business of baseball speak their minds while i wait for the actual results.
I don’t care about this either, that’s why I never comment on this Wilpon stuff. But I notice that you seem to comment on her posts almost all the time just to say you’re disinterested. If you are disinterested, than the best way to show that is by not commenting at all.
If you notice I am not commenting about what she wrote. That being “Mets Seek $200 Million For Portion Of The Team” but rather on what SRT said which was “maybe we can get a break from reading about ownership and $$ issues day after day.” Which then lead to a conversation with Annie revolving around “fans knowing the business part of the team off the field.”
I can see why you would misinterpret it but normally my comments are on the importance of the posts or relevance rather than the subject matter itself.
I appreciate though that you have taken an interest in what i have to say though it shows you enjoy reading my thoughts. For the record I enjoy reading your comments as well.
“…what SRT said which was “maybe we can get a break from reading about ownership and $$ issues day after day.”
Bingo.
To make it clear for you Jersey, since your intellectual level is not even 10% of Annie’s and to make it clear in words that you would understand and she wouldn’t use, she called you an *****. And secondly nobody in the universe cares what you do or don’t want to see, just like nobody cares what I want to see. Don’t like it, get a tissue from your little friends, now go write another pathetic novel about how you are always unfaiurly attacked. Ask the parrot if you don’t know what a novel is, nah he won’t know either.
Opening Day is tomorrow and all you have to say are not even your own thoughts?
Instead trying to “speculate” what a person like Annie that not only is no doubt an intelligent person but has the class not to succumb to silly name calling like you when she disagrees with someone?
SMH
Iz, it might surprise you to know that some folks, of whom I’m an example, care what you, what MNJ, and what everyone on MMO thinks. Why not, it’s mind expanding?
Don’t think I said it wasn’t big news. Wasn’t implying that anyone should ignore actual ‘new’ news concerning ownership and finances.
Just commented that once the season starts, hopefully we can get a break from the daily, recycled stories about ownership problems.
Well Annie I know the business part very well and I will tell you may not because you missed the one thing a Minority owner gets when Buying into a team.
FIRST SHOT AT BUYOUT!
Rarely does a team ever get sold outright unless someone makes an offer that is so overwhelming it is too good to refuse.
No one is making that offer not even Cuban!
Anyone who is interested in owning the mets at some point should have no issues buying a Minority stake. The WIlpons owned a Minority stake when they came in and when Doubleday wanted to sell out who got the first option to buy it?
Those Minority owning Wilpons!
Anyone who understands business knows that you don’t just BUY Majority interests unless the person who owns the Majority really wants out of the game!
Most takeovers (Hostile and otherwise) start off with someone who already owns a minority stake and makes an offer to the shareholders above current share value to try and consolidate control and achieve majority.
And those who have control may not sell before first getting approval from the other shareholders. Whatever offer opportunity that Majority might get MUST first be offered to the Minority holders to buy before any sale goes through.
And the buyer must be willing to pay EVERY shareholder that price if they want to buy in. SO when the Majority decides to cash out so too can the Minority holders.
SO by buying a minority stake in ANY company you are basically getting the right of first refusal on any sale and the right of first chance to BUYOUT the Majority should they decide to sell anymore shares later on!
For 200 Mil your getting the chance to own the mets in the future if the Madoff thing does bankrupt the Wilpons and they are forced to sell more shares!
And you are under NO OBLIGATION to float the business expenses with your own personal wealth either!
I know you are very predjudiced against the Wilpons but I have to say you really need to brush up on your business acumen regarding takeovers and Minority stakes.
You may not get control being the Minority but you do get to say your piece and you get a leg up on anyone who wants to buy the team in the future!
Buying a Minority stake is always the first step in taking over any large corporation!
Want proof just look at what Carl Icahn has done for the past 20 years!
Metsie, you are awfully impressed with yourself. How does it feel to be so alone?
I perceive that u are either a young, arrogant, spoiled individual or an older yet immature relatively inexperienced one. Since, if anything, my 61 years of life & business experiences throughout this country has taught me a simple fact; THERE ARE NO ABSOLUTES a minority portion of a highly restrictive privately owned family business is umlikely to have any guarantees especially in an enterprise conducting it’;s business in one of the most restrictive industries. First, a little recounting of history;
Nelson Doubleday, an individual, arrainged to purchase the NY Mertropolitan Baseball Franchise from the sole heir to the estate of the originally constituted owner, Mrs. Joan Payson in 1980. At the time of such sale, Doubleday controlled a 99% controlling interest in the transacted enterprise with Mr. Fred Wilpon, an individual investor controlling the remaining 1%. Thus the ownership remained divided until 1986 when the Board of Directors of Doubleday Publishing House concluded that Nelson Doubleday improperly used company funds in procuring his team ownership. the matter was settled out of court with no exact details being published, though one publicized outcome was the coincedental dropping of their claim by the Doubleday Board and the substantial increase in ownership percentage attributed to Mr. Fred Wilpon from his original 1% to a publicized equal 50% share though Fred requested and was given a right of first refusal on any further ownership transfer while Doubleday retained his position of managing partner. In 2002, after many internal disputes had widened the chasm between these two individuals Doubleday & Wilpon, they reached an agreement whereby they would have the franchise evaluated by an independent appraiser agreeable to both of them and that whatever the value was determined to be Fred Wilpon, as an individual would complete the buyout of Doubleday. Pursuant to that completion Fred Wilpon proceeded to effect an internal “sale” by which official ownership transferred from Fred Wi;lpon as an individual to Sterling Equities, a partrnership chaired by Fred.
Metsie, to date the current partnership of Sterling Equities is conmprised of these publicized partners:
FRED WILPON,CO-FOUNDER & CHAIRMAN
SAUL KATZ, CO-FOUNDER & PRESIDENT also Fred’s brother-in-law by marrying Fred’s sister
MICHAEL KATZ Sr. EXECUTIVE V.P. son of Saul, nephew of Fred
RICHARD WILPON Sr. EXECUTIVE V.P. brother of Fred, brother in law to Saul & Uncle to all their prodigy
DAVID M KATZ, EXECUTIVE V.P. son of Saul, nephew of Fred & Richard
THOMAS OSTERMAN, EXECUTIVE V.P.
JEFFREY WILPON EXECUTIVE V.P. son of Fred, nephew of Saul & Richard
ARTHUR FRIEDMAN SR. V.P.
GREGORY KATZ, V.P. son of Saul, nephew to Richard & Fred, cousin or sibling to many
MARVIN TEPPER- PARTNER
Metsie, it would take an ironclad legal agtreement to lock a position of any consequence regarding future ownership to sustain any position of control in that private owneship environement.
Privately, family owned parnerships are regulated quite diffeently than widely held public institutions.
Well 62 I am 49 and have served as a CTO, COO and President of 5 different companies!
So I think my business resume pretty much speaks for itself!
If you are a Minority Partner in a company you will always have first right to buy and match any offer made to a controlling partner.
And the COURTS will stop anyone who tries to do or say otherwise!
You can not stop someone with controlling interest from selling but you do have the right to match any offer made by someone else to buy control of the company you already own!
Metsie, color me chargrined & impressed; however are u considering the CLOSED market u r dealing with? unlike any other contemporary business venture,MLB is like your private Country club, any perspective new owner MUST first be vetted & passed by the Ownership Committee, even in a minority to majority sale is my understanding. Unfortunately THEY & THEY alone have that ultimate right of refusal!
Right! you are correct about the vetting. This is why before you buy even a minority stake you must pass the old boy network VETTING proccess.
This is what has been happening lately. There are a few buyers and they must pass the MLB Old boy network acceptance before they can be considered buyers.
Once you pass that test you HAVE BEEN vetted. Which means the MLB already has decided your a good ol boy that can play ball in their court, and if the Majority owner tries to sell you will have right of first refusal without any need to be re-vetted!
Owners and limited partners can not just willy nilly sell their shares to whomever they want without consultation with their partners. They can entertain offers but that offer must be brought before the board and the offer made must be made available to all shareholders of that company. This is so that current partners can retain their precentage of the company as long as they are able to meet the offerred price.
While the board can set the price (and by the control of the board Majority actually sets this), That price applies to every shareholder in both the Buy or Sell mode.
If they can’t afford to buy it they can then sell their shares and get out. But if they can buy control at that price they have the first right to do so.
Provided the partner who is buying pays whatever the outside buyer is offerring they will get first crack at the sale.
The only time this does not happen is when the price to buy up control costs more money than the limited partner has!
The bottomline on these deals is if company A offers 1 Billion dollars for 1 million shares then the limited partners can buy those shares first at the same price. The only time when limited partners get bypassed is when the price is beyond their means and they can not meet the offer.
In those cases their right of first refusal has been met but since they can’t afford to act the sale to someone else goes through.
Basically 62 just look at how the Wilpons got the team.
Doubleday used to be the Majority owner. Wilpons the Minority. Doubleday wanted to sell. The wilpons secured loans and put up the money to buy it without even a sniff of trouble from the MLB.
Pretty much once your in your in!
METSIE, THERE U GO ASSUMING & PRESUMMING AGAIN. MY GUESS IS FRED WAS GRANDFATHERED AS AN “ESTABLISHED OWNER OF RECORD” PRIOR TO SELIG FORMING THE COMMITTEE.
PLS NOTE, THAT’S LABELED MY “GUESS” GRANTED AN EDUCATED,LOGICAL ONE; BUT MERELY A GUESS AS I DON’T PRESUME TO KNOW THE INTIMATE RITES OF PASSAGE INTO THE INNER MLB SANCTUM.
SORRY FOR CAPSLOCK; I WAS ALL DONE WHEN I LOOKED UP & OBSERVED IT’S ACTIVATION. DEAL WITH IT, I’M TOO LAZY TO RETYPE IT NOW.
being accepted by the owners before you buy a team has ALWAYS been Standard Operating Procedure at the MLB.
It is particularly boring compared to actual baseball.
I wish they could just get it over with so the only thing we needed to focus on is real baseball – on the field, etc.
Once the games start, and there is daily actual baseball to discuss, the press won’t be so hard up for things to write about. The financial/owners stuff will fade into the background where it belongs, unless something new actually happens.
really very few people care about it, unless something happens that actually impacts the team on the field, and who knows when or if that will even happen this season.
what is his obp? oh yeah again, not a post about baseball
to answer your question, yes, losing $5mill is very much possible due to ticket sales.
keep in mind that the Wilpons (remember, they are real estate people!) leveraged the hell out of everything (citi, the mets, SNY) to raise cash to offset losing Bernie in 2008, paying a huge chunk of building Citi (it was not taxpayers that paid the bulk of it, it was the Wilpons), etc.
and most likely, they budgeted cash flow (done well in advance) based on expected attendance of say 3.2mill (new stadium, what they drew at Shea, etc.).
estimates vary, but the most commonly accepted # for the decrease in ticket sales last year was 600K. Not even counting whatever they well below estimate in 2009, or how many tixs sold did not translate into fannies in the seats.
So, do the Math. At 600K drop, that is $83 each in lost revenue. Less per head if the drop is bigger.
So, factor in the ticket prices (and I bet the expensive ones were hardest hit), lost food/beer/souvenirs/parking, and $83 a piece does not seem out of line.
so bingo, they go from a budget of breaking even (including debt service), to loosing $50mill in gross revenue.
wow that is exciting
I wish the NY Mets would be come a publicly traded company or whatever kind of setup they have over there in Green Bay with the Packers. Where the fans own shares of the club and therefore can influence club decisions with enough of a majority.
I know if the Mets were to offer shares in the franchise for $10/share, I probably would buy a bunch of them.
I would do the math to see how many people that would take, but it would get martin all upset again, and I don’t want to do that.
yeah the fans are really calling the shots in green bay. not only do they have the power. the fans all agree. seems worth calculating
For someone who likes to point out spelling errora and typos, you have the worst sentence structure I have ever seen.
not only do they have the power.
What is that?
seems worth calculating.
Did you mean “Seems worth investigating.”
Your comments usually suck in general and are pointless, but a least make an attempt to capitalize, use proper grammar, and make some sort of a point.
Otherwise, your comments are simply a waste of time, much like your presumed baseball intellect.
I guess you could say I just viloated my self imposed policy of ignoring you.
i have a broken finger and a weird new keyboard tat are not doing me any favors.
Starting the season on the DL too Martin?
LOFL
Green Bay has a board that by agreement runs the team and puts all the money it makes back into the team, so there’s no dividend, no perks, no nothing. But just like everything else there is always corruption. Someone on that board (or everyone) sold Super Bowl Tickets that season ticket holders were supposed to be able to buy back in 1995 or whenever it was.
Nothings perfect, but the setup we had was probably the best. Streamlined decision making, no corporate owner caring only about the bottom line or depreciation. We just never had Owners that were fully committed to winning enough that did all the work necessary. The Scouting, drafting, signing, developing of their future product year in and year out.
Quick to allocate the funds for a big name right before season ticket renewal time but quick to save a buck on scouting, drafting, signing and developing a whole core that could form the basis of a winning team for a decade or more.
the set up that they have in green bay is basically this:
the team got the fans to “buy” shares in the team. the shares are not allowed to be sold, so basically the fans just gave their money to the team, and that money never comes back. if you bought a share, you didn’t get tickets, or a dividend, or even a t-shirt. nothing of material value.
in return, they kept the team green bay for a few more years and got at least one title out of it.
The $200 million dollar number sheds more light than simply saying 25% or 49% stake.
If the team was valued at 1 billion, than obviously 200MM buys you 20%. If the team is valued at 750 million, then that same 200MM buys you about 27%.
Before the actual percentage is determined, the value must be determined oh and by the way, Forbes does not set values on any businesses or corporations. Their annual foray into the guesstimate business is just that, a guess. It’s even more of a crap shoot when Forbes tries to guess values of companies that are not public and dont have to share their annual reports.
For all the talk that the Wilpons are broke, nobody really knows how much they are worth. The Sterling Empire is vast in real estate holdings, leases, property income, and other very diversified investments that had nothing to do with Madoff.
In 2009 Saul Katz filed a tax return for $126 million in earnings that year. One year! Fred is worth even more and Jeff at least as much as Saul. Dont listen to all the bunk that is being dished out, these three are loaded and nobody really knows how rich they really are.
All you hear about are the debts because that’s public knowledge, but their net worth is not nor is their personal assets.
Now here is a true genius. reports abound from very respectable organizations about the Wilpons and the Mets. But here is squiddo who knows it all telling us that it is all baloney. Sure Squiddo., By the way what is your sourece?? Steve Phillips? Lenny Dykstra, maybe the king of the ponzis himself? LOL…
If you could read wiz you would have realized that Squidoo was sharing a relevant insight about the article’s topic.
It’s quite a bit over your head but perhaps you could shed some expertise on the marketed to morons WWE. That’s more along your level.
Since when has the NY Times been known as a respectable organization?
They have been mired in plaugerism, Political Bias and outright FALSE FACT accusations in the last 20 years than any other newspaper in NY!
The NY Times in not the same paper we all grew up with!
WSJ is owned by Murdoch who also owns Fox TV.
What do many people feel about that network?
Lets face facts here. Picard has connections with those two papers.
It is obvious. Not one mention of the suit by the victims against Picard (the guy who supposedly represents them)
A guy who put in 200 Billion (200 Times what the Wilpons invested) settled and paid 200 Million back to the Victims which just happens to be the amount the plaintiff’s daughter borrowed as an alleged “LOAN” from the fund. No mention of it in the settlement by Picard (Hmmm) and he was willing to make a 200 Mil settlement for a 200 Bill investment but wants the whole one Billion back from the Wilpons?
as Fishy as a week old mackrel that has been sitting in the sun!
Please stop using it’s (it’s Network) or its’. The word is its and it ain’t possessive.
IT’S = IT IS
Dave, you are absolutely correct; but should have also supplied the correct possessive is spelled, ITS’ meaning ostensibly it owns… the answer would be(its’ Network)
itsitsitsitsitsitstitstitstitstitstitsitsitsits
NI!
OLD NEWS; but a very tough sell requiring the ‘new’ partner to accept wearing the rose colored glasses that acquieces to the overall team’s total valuue @ a Sterling set $800M, especially as Forbes just published it’s estimationof worth to be a significantly less $750M. That’s one hell of a rounding eroor requiring one gigantic leap of blind faith. As in most financial trabnsactions, there is a buyer’s price & a seller’s price upon which success relies on a merger of values. as well as an altering of conditions.
Not getting a lot of play in these press clippings is the deja vue factor in evidence as in 1980 Ms. Lorinda de Roullette, heiress tio NYM fortunes from her deceased mother Mrs. Joan Payson, had instigated an expolratory attempt to increase her cashflow by engaging an investor to become a minority partner, not getting much interest other than from those ONLY interested in an entire buyout, deRoulette succombed, ultimately to the full buyout by Nelson Doubleday and his token 1% minority partner, Fred Wilpon. We can only hope that the deLaurian is still functional