New Minor Owner, Same Major Problems
The Mets have the minority owner they hope will be able to bail them out of their major financial mess in the fallout of the Bernie Madoff Ponzi scheme.
David Einhorn, president of Greenlight Capital Inc., will purchase 49 percent of the team for roughly $200 million. The sale does not include any ownership segment of SNY. The $200 million will go toward paying down the Mets’ considerable debt, which includes repayment of a $25 million loan to Major League Baseball.
The Mets confirmed the sale this morning in a press release, saying Einhorn has a non-operating stake in the team.
“We are very excited about David joining our ownership group for several reasons,” owner Fred Wilpon said. “David’s investment immediately improves the franchise’s financial position. Equally important, David’s intelligence, integrity and success in both business and civic affairs provides us with another perspective in evaluating what is best for this organization and our fans, and we welcome his input. In partnership with David, we look forward to achieving our ultimate goal of again becoming World Series champions.”
Einhorn, 43, co-founded Greenlight Capital in 1996. He is the author of “Fooling Some Of The People All Of The Time,” a book detailing his battles with Allied Capital. Considering how all this transpired and the parties involved in the Ponzi scheme, it is an ironic title.
Einhorn grew up a Mets fan and dressed up as Dave Kingman one Halloween.
“Having an opportunity to become part of the Mets franchise is exciting beyond my wildest childhood dreams,” Einhorn said in the release. “ 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.”
Assuming the sale goes through, this is far from over for Wilpon, who said the Mets are “bleeding” cash and will lose up to $70 million this season. He’s still facing a $1 billion lawsuit from trustee Irving Picard, a suit that if he loses could force a complete sale of the Mets.
Should that occur, Einhorn will have first opportunity to purchase the majority share.
Reportedly, the Mets will have a payroll between $100 million and $145 million next season, probably closer to the former. Although the Mets will have several significant contracts off the books, GM Sandy Alderson said not to expect any lavish purchases in the free-agent market.
The Mets’ first major financial decision is considering signing Jose Reyes to a contract extension expected to be over $100 million.
In a magazine article, Wilpon criticized Reyes, saying everything (injuries) have happened to him and that the 27-year-old All-Star shortstop is misleading himself if he expects a contract similar to the one Boston gave outfielder Carl Crawford ($142 million).
The Mets would receive compensatory draft picks should Reyes sign with another team, but must weigh that in what they could get in a trade. The teams linked to Reyes in a possible trade include San Francisco, Boston, St. Louis, Toronto and Washington.
About the Author: John Delcos
I am an active member of the BBWAA and have covered Major League Baseball in several capacities for over 20 years, including ten in New York working the Mets' and Yankees' beat. I covered the Baltimore Orioles for eight years and the Cleveland Indians before that. I currently serve as an editor and senior staff writer for Mets Merized Online. Follow me on Twitter @jdelcos.
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