26
2011
Einhorn In Negotiations To Buy Minority Share Of Mets
An article by Hojo's Mojo
The New York Mets have agreed to sell less than 49 percent of the club for approximately $200 million to David Einhorn, president of Greenlight Capital Inc. according to ESPN’s Karl Ravech.
The sale will not include a stake in SNY, the television network owned by the Mets, the sources said.
Bloomberg and Sports Illustrated have also confirmed this report.
Added to by Joe D.: We don’t know how much decision-making power would come wirh a sale like this, but it may not change the culture all that much or as much as we all would like.
Original Post 08:00 AM
According to Richard Sandomir of the New York Times, the Mets have settled on a minority partner who will pay $200 million for less than 49% of the team and will not receive a portion of SNY, the team’s profitable cable network, a person briefed on the matter said. .
The article does not name the winner, but identifies David Einhorn as a name who has emerged. He is the president of Greenlight Capital, based in Manhattan.
Several bankers who heard Wednesday about a pending announcement by the Mets said they were still unsure who the prospective buyer or buyers were. One possible bidder whose name emerged Wednesday, according to two people familiar with the bidding process, was David Einhorn, a Manhattan hedge-fund manager; he grew up in New Jersey and Milwaukee and masqueraded one Halloween as the former Met Dave Kingman when he was a five or six-year-old, he told the Wall Street Journal.
Asked specifically about Einhorn as a prospective buyer by ESPNNewYork.com this week, the Mets issued this statement:
“Amidst the ongoing speculation related to our continued negotiations for a sale of a minority interest in the New York Mets, we will neither confirm nor deny the identity of any of the possible partners nor the details of any potential deal.”
About the Author: Rob Johnson
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wilpon’s still own the team… they found a sucker to bought into the mets while pretty much having nothing to do with the team… but, if the lawsuit goes down and the wilpon’s lost (pray to god it happens) then einhorn can actually back out of deal, making and forcing the wilpon’s to sell more share or lose entity of the team…
I highly doubt that a year from now, if the Madoff settlement goes down, that Einhorn can just ask for his money back and walk away.
there’s a settlement that stays if the lawsuit will make him lose money and wants to back out he can, also, it gives the choice that if the wilpon wants to sell he’d be the first one in line to buy majority of the team…
right. Essentially he’s buying the opportunity to not only own the Mets but when the Mets cut some payroll etc. he’s getting an option to make some $ in the process
Good, a hedge fund manager. not like they aren’t 1 step above ponzi schemers or anything!
It will also be interesting to see how the money works going forward. If money has to get put into the team, it needs to be proportional from wilpons and the new guy.
makes no sense for Fred to sell off a % of the team, then put that money right back into paying off team debts. If that happened, the new guy would be double dipping.
Bankrupted in 2008? Buys 49% of the Mets for $200 Million in 2011??
What am I missing here? Not exactly a rock-solid investor is he?
Are you replying to my post?
If so, you’re missing the fact Lehman Brothers Company went bankrupt in 2008… not Einhorn
Basically Einhorn was the first (as far as I know) to publically come out and say Lehman Bros were falsifying their records and called them out on not being as profitable as they said they were which lead to Lehman going bankrupt when the truth was revealed.
ohh, so he’s a snitch?? great, that completes what we were missing, crooks and snitches as owners lol…
alex: haha no? Are you just always negative or do you not realize that the fact he was investing in a company and he figured out they were falsifying documents and he called them out was a GOOD thing?
lol, i know bro.. just having fun with it… honestly to me, him buying into the mets doesn’t do anything for me, he’s just a business man, not a savvy sports business man if you catch my drift.
Thank you for the explanation. What I was trying to convey is that given Einhorn’s tarnished hx. is he the right choice? I am assuming that Einhorn just don’t have $200 million laying around and will need to ..I don’t know.. haha.. go on some sort of payment installment plan?? I’ve got a checking account balance of about $1400.00 what do I know?
eichorn is not tarnished. If anything, he is one of the few people connected to the financial meltdown that actually pointed out some of the emporers were naked!
with lehman, he made his money shorting the stock. This means that he felt it was priced way to high (and the company was little to fail, as it did), so he essentially bet on it going down (which is pretty much all shorting stock is). Of course, if the price had gone up and he had to cover his shorts (losing his real ones in the process), he would not be looking to buy a stake in this team.
Thanks guys, Obviously I need to read up on this man more.
Lifelong: I think there’s a disconnect here.
What is tarnished about Einhorn exactly?
This is probably just a set up for him to take over in 2 or 3 years. The most valuable asset is SNY, but Comcast and Time Warner have both publicly stated they would execute their veto rights on any deal that included SNY. Einhorn probably just has to hold on a prove himself before he can buy a controlling interest in the Mets and a piece of SNY.
Otherwise, this deal doesn’t make a lot of sense for him.
sure it does. From 2 aspects.
1st, it is an undervalued asset right now (that is, it should be a cash cow, and likely will again in the future) that he can buy into on the relative cheap. Odds are that his stake will increase in value
2nd, he is stinking rich (off of paper shuffling, the american way!) and when you get to a certain point of richness, you need something to do with your money (a toy or hobby). And very few opportunities come up to own a NY MLB team. So even if he just breaks even, it is still cheaper than buying a private jet.
this goes for Fred too (from what he has said), but buying into a pro sports team for a rich guy is not the same as evaluating a widget company you might want to buy into. It is much more emotional.
and of course, with the mets, there is the real possibility that in the near future, if you want to, you will have the opportunity to take over majority control.
Hey, he said it better than I did. You don’t here this when some investment fund guy buys a taco bell franchise.
Mr. Einhorn stated, “Having an opportunity to become part of the Mets franchise is exciting beyond my wildest childhood dreams. I spent my first seven years living in New Jersey and rooting for the Mets. In 1975, I even dressed in a homemade jersey as a Met for Halloween. I have been a baseball fan for my entire life and have enjoyed teaching the game as the coach of my daughter’s little league team. I look forward to partnering with the Wilpon and Katz families through the good seasons, the tough seasons and especially the championship seasons”
Here’s an update:
http://sports.espn.go.com/new-york/mlb/news/story?id=6592210
A little about Einhorn:
Starting July 2007, Einhorn became a short seller in Lehman Brothers stock. He believed that Lehman was under-capitalised, and had massive exposures to CDOs that were not written down properly. He also claimed that they used dubious accounting practices in their financial filings.
When Bear Stearns had to be bailed out by the Federal Reserve in March 2008, Lehman was widely considered to be in a fragile state. Lehman’s CFO was Erin Callan, hailed by the Wall Street Journal as “Lehman’s Straight Shooter”. But she had been on the job for just six months and her background was as a tax lawyer, not in finance.
In a speech at a conference in April, Einhorn started talking publicly about his Lehman short positions. Lehman called Greenlight and asked for a copy of the speech, which was sent over.
In May 2008, Lehman CFO Callan had a private call with Einhorn and his analysts. The conversation with Callan was to give her a chance to explain discrepancies he had uncovered between the firm’s latest financial filing and what had been discussed during its conference call about that filing.
Ms. Callan is said to have fumbled some of her responses to questions on Lehman’s asset valuations. When Einhorn later went public with the conversation, the declining Lehman share price took a further knock. Callan was fired a few weeks later, when Lehman reported a worse than expected $2.8bn second-quarter loss.
Lehman went bankrupt in September 2008.
You can also check out: http://www.foolingsomepeople.com/main/about-david/bio.html
http://dealbreaker.com/2011/05/42-year-old-david-einhorn-makes-7-year-old-david-einhorn-very-happy/
Sale confirmed
http://espn.go.com/blog/new-york/mets/post/_/id/24036/wilpons-confirm-sale-to-einhorn