The most important man in Major League Baseball right now is Steve Cohen. The hedge fund titan is the man MLB commissioner Bud Selig is genuflecting in front of, praying Cohen will bail him out for permitting the bankrupt Los Angeles Dodgers and cash-strapped New York Mets for piling insane amounts of debt on their balance sheets.
Over the past two months, as Fred Wilpon and Saul Katz have been slashing their team’s payroll and looking for nickels and dimes under every nook and cranny, the only only investor not affiliated with Mets that has offered to help keep the team afloat has been Cohen, offering $20 million for a 4% stake. The Mets are praying that their season ticket sales will look good enough by the end of April that they can restructure $430 million of debt due in two years. If not, I, and at least two sports bankers I have spoken with, believe it is quite possible the Mets will follow the Dodgers into Chapter 11. But at least Cohen is offering the Mets a temporary lifeline. Selig owes Cohen one for that.
During the next few weeks Cohen is also going to set the bar on the sale price for Frank McCourt’s Dodgers. In doing so, Cohen is will be sending a signal on the value of many of the new local television deals struck recently. The Texas Rangers, Los Angeles Angels and San Diego Padres (pending) have received equity stakes in regional sports networks as part of their new media deals. Several other teams, like the Chicago Cubs, are likely to do the same thing over the next couple of years. Cohen’s bid for the Dodgers, which is largely based on what he thinks the value of the team’s next media deal, beginning in 2014, is worth, is going to influence the value of a lot of RSNs.