Baseball for the Thinking Fan

Login | Register | Feedback

btf_logo
You are here > Home > Baseball Newsstand > Baseball Primer Newsblog > Discussion
Baseball Primer Newsblog
— The Best News Links from the Baseball Newsstand

Friday, February 03, 2012

Adam Rubin: SNY bailing out Mets

According to the report, Time-Warner and Comcast—the Mets’ business partners with SNY—authorized the purchase of 16 percent of the ballclub to prop up the Mets, which in turn should help ratings. The $80 million infusion should allow the Mets to meet this year’s debt obligations.


Makes some sense, to the extent their fortunes are already intertwined.

Arbitol Dijaler Posted: February 03, 2012 at 11:36 AM | 24 comment(s) Login to Bookmark
  Tags: business, mets, television

Reader Comments and Retorts

Go to end of page

Statements posted here are those of our readers and do not represent the BaseballThinkFactory. Names are provided by the poster and are not verified. We ask that posters follow our submission policy. Please report any inappropriate comments.

   1. Something Other Posted: February 03, 2012 at 02:39 PM (#4052942)
Fecking hell. Does this mean the Wilpons are all but guaranteed to own the team into next offseason?
   2. snapper (history's 42nd greatest monster) Posted: February 03, 2012 at 02:42 PM (#4052945)
Fecking hell. Does this mean the Wilpons are all but guaranteed to own the team into next offseason?

Unless JPM can force bankruptcy through some covenant violation, or MLB pulls its credit, it sounds like it.
   3. Brian Posted: February 03, 2012 at 02:49 PM (#4052958)
The Mets are valued at $500mm?
   4. Jim Wisinski Posted: February 03, 2012 at 03:08 PM (#4052980)
The Mets are valued at $500mm?


Maybe desperation on the Wilpons' part since their 10 or 20 or whatever it is this week limited partners still haven't bought into the team? With no other options they had to strike a poor deal with the only parties interested in becoming limited partners.
   5. Arbitol Dijaler Posted: February 03, 2012 at 03:12 PM (#4052985)
Doesn't SNY have an interest in seeing that the team not freaking suck, and wouldn't this increase that interest?
   6. billyshears Posted: February 03, 2012 at 03:23 PM (#4052996)
So it seems that the majority of the 10 limited shares the Mets anticipate selling will either be bought by the Wilpons/Katzs themselves or by other parties that are already insiders. I imagine the others shares went to Steve Cohen (as has been reported) and others of his ilk who see this purchase as a way to put them in the drivers seat when the Wilpons are ultimately forced to sell the team.

The Wilpons will try to portray this as a success. It isn't.
   7. The Piehole of David Wells Posted: February 03, 2012 at 04:47 PM (#4053077)
The Wilpons will try to portray this as a success. It isn't.


The Wilpons' ownership share has been considerably diluted, but I don't see how this isn't a success. They basically get free money that is not more debt to cover expenses. They also now have Time Warner as an equity partner now responsible for 16% of the team. They are now sure to get even more favorable television deals. They also still retain the position to further dilute their ownership share while still retaining control of the team, should they need more money, and as an added bonus are diluting their risk at the same time.
   8. Arbitol Dijaler Posted: February 03, 2012 at 04:49 PM (#4053080)
They basically get free money that is not more debt to cover expenses.


Functionally, it is debt - reports had it repayable with interest in 3 years.
   9. JPWF1313 Posted: February 03, 2012 at 05:04 PM (#4053091)
They basically get free money that is not more debt to cover expenses.

1: It is not free money, first of all a % of it is their own damn money (they own a chunk of SNY you know.
2: It dilutes their Mets ownership interest, sure they still have majority control- but it reduces their future wiggle room
3: It is supposed to be repaid to SNY within 3 years, if not you KNOW that Time Warner and Comcast are going to put the squeeze on

They also now have Time Warner as an equity partner now responsible for 16% of the team.

????? No, Time Warner owns a% of 16%, Time Warner is not liable for any of the Team'/s debts

They are now sure to get even more favorable television deals.

Really? my first thought was that Time Warner and Comcast were now going to make damn sure that the TV deal were going to be more favorable to SNY than even before

They also still retain the position to further dilute their ownership share while still retaining control of the team, should they need more money
Well, they have diluted their ability to do that, plus this deal value the Mets at a lower quantum than their previous attempts at selling minority shares did.

and as an added bonus are diluting their risk at the same time.

diluted what risk?

Essentially this is desperation, they need cash, they really have no minority partners coming on, and this is the absolute most that Time Warner and Comcast would let them pull from SNY...
   10. Swedish Chef Posted: February 03, 2012 at 05:06 PM (#4053093)
The Wilpons' ownership share has been considerably diluted, but I don't see how this isn't a success.

They sold 16% of the team for a band-aid that will pay the debt for a year. If that is a success, I don't want to see what failure looks like.

But of course, the real losers are the fans who get stuck in a holding pattern for another year.
   11. snapper (history's 42nd greatest monster) Posted: February 03, 2012 at 05:12 PM (#4053096)
If that is a success, I don't want to see what failure looks like.

I think failure was Ch.11 in April. So, it's a success if they're desperate to hold onto the team.

I don't know why they won't sell.
   12. JE (Jason) Posted: February 03, 2012 at 05:26 PM (#4053106)
I don't know why they won't sell.

For the same reason Mubarak didn't want to give up the throne. An ex-President-for-Life doesn't get his phone calls returned.
   13. The Yankee Clapper Posted: February 03, 2012 at 05:29 PM (#4053111)
Looks like the de-Wilponization process will be strung out further while the current regime desperately holds on to control, leading to losing seasons played before ever smaller crowds and dwindling TV audiences. Sad.
   14. bobm Posted: February 03, 2012 at 05:39 PM (#4053117)
[11] I think failure was Ch.11 in April. So, it's a success if they're desperate to hold onto the team.

Maybe the Time Warner misheard the Wilpons' plea and thought they were threatening to go "Channel 11" instead.
   15. valuearbitrageur Posted: February 03, 2012 at 06:34 PM (#4053156)
o it seems that the majority of the 10 limited shares the Mets anticipate selling will either be bought by the Wilpons/Katzs themselves or by other parties that are already insiders


They can't sel the samel shares to outsiders at a $1B valuation while selling shares to a partner at half that price.
   16. base ball chick Posted: February 03, 2012 at 08:44 PM (#4053221)
real sorry mets fans

looks like all yall stuck for at least another year
   17. JE (Jason) Posted: February 03, 2012 at 09:37 PM (#4053239)
looks like all yall stuck for at least another year

On the bright side, at least we get to stay in the National League a while longer.
   18. Something Other Posted: February 04, 2012 at 05:32 AM (#4053357)
And come in fifth, at least ten games out of fourth.

Just so I can feel worse, is there any somewhat reasonable scenario in which the Wilpons maintain control of the Mets for another decade plus? The economy continues to improve, a high percentage of the Mets minor leaguers pan out making the Mets a mid80s win team even on a small payroll, court decisions continue to be favorable...
   19. Sam M. Posted: February 04, 2012 at 12:33 PM (#4053409)
On the bright side, at least we get to stay in the National League a while longer.


Boy, that's a toughie. Getting rid of the Wilpons, and getting the Mets into the hands of capable, well-capitalized owners. Would that be worth going to the American League? Astros fans don't face that choice, because they aren't getting the "capable, well-capitalized owner" as part of the deal.

I guess I honestly just don't get the actions of the SNY partners here. If I were them, I would want the Mets to be competitive on the field, and thus a ratings magnet for the network. That would be my priority. Ratings drives profits. Getting a new partner and getting the Wilpons out serves that purpose. Why should they want to draw this nightmare out, when the very fact that this (the necessity of SNY buying these shares) indicates that there are no other buyers for the shares, and thus that the end could be in sight (a matter of weeks, really) for the Wilpons as they simply cannot finance the losses/payments they have to make. At some level, I suppose it could simply be a case of deciding that if Fred Wilpon wants to continue to dilute his ownership share and thus have less to walk away with when he does, inevitably, have to sell his ownership interest, that's his business. But delay means continued decaying of the product, and I just don't understand why that is in Time-Warner or Comcast's best interest.
   20. bobm Posted: February 04, 2012 at 12:56 PM (#4053422)
[19] I guess I honestly just don't get the actions of the SNY partners here. If I were them, I would want the Mets to be competitive on the field, and thus a ratings magnet for the network. That would be my priority. Ratings drives profits. Getting a new partner and getting the Wilpons out serves that purpose.

IIRC the SNY cableco partners can block any sale of (a part or all) of Wilpon's interest in SNY only if the buyer is a competitor, ie another cableco, etc. However, they have merely right of first refusal on a sale to an outside investor. What if the alternative to this loan to / minority equity purchase of the Mets was for the present SNY partners to meet an outside investor's offer for a piece of Wilpon's share of SNY? How should the present SNY partners have acted then to maximize their long term profits?
   21. Swedish Chef Posted: February 04, 2012 at 12:58 PM (#4053423)
At some level, I suppose it could simply be a case of deciding that if Fred Wilpon wants to continue to dilute his ownership share and thus have less to walk away with when he does, inevitably, have to sell his ownership interest, that's his business. But delay means continued decaying of the product, and I just don't understand why that is in Time-Warner or Comcast's best interest.

Getting a piece of the Mets means they will have a say when it is time to sell the team, and they can block cheapskates. Or maybe one of them is planning to acquire the Mets themselves.
   22. akrasian Posted: February 04, 2012 at 01:34 PM (#4053442)
I don't think it's complicated. They are buying a significant chunk of the Mets as if the team is worth only $500 million. I suspect that SNY partners feel that the team is worth far more than that, and figured to take advantage of the Wilpons' financial woes to nab basically free money.
   23. bobm Posted: February 04, 2012 at 02:06 PM (#4053454)
[22]
They are buying a significant chunk of the Mets as if the equity in the team is worth only $500 million.


The enterprise value of the team is comprised by much debt and far exceeds $500 million FWIW
   24. Something Other Posted: February 04, 2012 at 05:18 PM (#4053528)
On the bright side, at least we get to stay in the National League a while longer.

Boy, that's a toughie. Getting rid of the Wilpons, and getting the Mets into the hands of capable, well-capitalized owners. Would that be worth going to the American League?
Yes. Yes it would. Or sacrificing goats. Anything, really.

You must be Registered and Logged In to post comments.

 

 

<< Back to main

BBTF Partner

Support BBTF

donate

Thanks to
HowardMegdal
for his generous support.

Bookmarks

You must be logged in to view your Bookmarks.

Hot Topics

NewsblogOT: Politics, October 2014: Sunshine, Baseball, and Etch A Sketch: How Politicians Use Analogies
(2739 - 5:15pm, Oct 20)
Last: David Nieporent (now, with children)

NewsblogOT: Monthly NBA Thread - October 2014
(269 - 5:13pm, Oct 20)
Last: Manny Coon

NewsblogCould the Yankees ever be Royals? Young and athletic K.C. is everything that Bombers are not - NY Daily News
(20 - 5:11pm, Oct 20)
Last: RoyalsRetro (AG#1F)

NewsblogFan Returns Home Run Ball to Ishikawa; Receives World Series tickets
(9 - 5:10pm, Oct 20)
Last: The Id of SugarBear Blanks

NewsblogWhy Royals great Frank White no longer associates with the team whose stadium he built - Yahoo Sports
(15 - 5:05pm, Oct 20)
Last: RoyalsRetro (AG#1F)

NewsblogCalcaterra: So, if you’re not a fan of the Royals or Giants, who ya got?
(64 - 5:01pm, Oct 20)
Last: Harveys Wallbangers

NewsblogOT: The Soccer Thread, September 2014
(832 - 4:46pm, Oct 20)
Last: ursus arctos

NewsblogHitting coaches blamed for lack of offense - Sports - The Boston Globe
(11 - 4:28pm, Oct 20)
Last: Zach

NewsblogBrisbee: The 5 worst commercials of the MLB postseason
(121 - 4:26pm, Oct 20)
Last: JJ1986

NewsblogMorosi: Could Cain’s story make baseball king of sports world again?
(96 - 4:22pm, Oct 20)
Last: Into the Void

NewsblogPrimer Dugout (and link of the day) 10-20-2014
(37 - 4:22pm, Oct 20)
Last: SoSHially Unacceptable

NewsblogBernie Miklasz on Twitter: Matheny, when asked about not using closer T. Rosenthal in 9th
(133 - 3:55pm, Oct 20)
Last: Random Transaction Generator

NewsblogOT: NFL/NHL thread
(8360 - 3:19pm, Oct 20)
Last: zenbitz

NewsblogCardinals proud of fourth straight NLCS appearance | cardinals.com
(47 - 2:46pm, Oct 20)
Last: Barry`s_Lazy_Boy

Hall of MeritMost Meritorious Player: 1959 Ballot
(5 - 1:58pm, Oct 20)
Last: MrC

Page rendered in 0.1633 seconds
52 querie(s) executed