Fractured Fairy Tales, 2020 Edition
nteresting story by Victor Mather in the New York Times today. As the title of the piece stated, the Mets really do have "a colorful financial history." I've been reading for years that Nelson Doubleday felt that Fred Wilpon had dealt with him in a less than honest manner. Some of that is detailed in this article. Also interesting was Doubleday's claim by in 2002 when Wilpon was attempting to buy him out of his remaining share of the club:
The article went on to document another effort by the Wilpons to sell a piece of the club, the one back in 2011 when hedge fund manager David Einhorn was looking to buy a minority share of the ballclub. The way that deal fell apart was documented in this ESPN piece from September, 2011. This is interesting, because the Wilpons claimed this year that it was Steve Cohen who tried to change the deal at the last minute when that sale fell through earlier this year. But it's the Wilpons who have the history of changing deals at the last minute:
Returning to the present, I've always found it somewhat hard to believe that a very smart guy like Steve Cohen was willing to pay the Wilpons over $2 billion for the Mets without SNY and not only allow both Fred and Jeff to stick around for 5 years, but actually fully control the Mets for that 5 year period. Now, I understand that Rob Manfred backs the Wilpons up on their accusations that Cohen tried to change the deal, but Manfred basically will believe and swear to anything the owners tell him. Just ask Astros owner Jim Crane.
Anyway, by most accounts Steve Cohen bid the most for the Mets in the first round of bidding. Supposedly he offered $2 billion for the club and another $2 billion for the Wilpon's interest in SNY. According to the Post, Alex Rodriguez and Jennifer Lopez bid $1.7 billion and are still in the hunt. Rumors are that the Wilpons would prefer to sell to someone else besides Cohen if all things are equal, but I'd be curious to see how close Rodriguez and Lopez would need to be. If the numbers reported are true and continue as final bids, I would not expect the Wilpons to spit on $300 million just because their feelings were hurt. It's all speculation right now, so I won't try to guess at any conclusion based on strictly the guesses of others.
Doubleday claimed he had been "double-crossed" by a "sham process." He claimed in legal papers that Major League Baseball and the Wilpons were "in cahoots" in a scheme to keep team values down and manufacture "phantom operating losses" to make the game seem less financially sound and in that way create an advantage in negotiations with the players' union. (Baseball dismissed the claim as "nonsense and a complete fabrication.")That's the same charge that the Player's Association and player's agents have been making for years, and I have little doubt that there is truth to these allegations. This is why club owners are always crying poverty, as they were doing on local sports radio stations during the failed negotiations of May and June, but are never willing to fully open their books to prove their assertions.
The article went on to document another effort by the Wilpons to sell a piece of the club, the one back in 2011 when hedge fund manager David Einhorn was looking to buy a minority share of the ballclub. The way that deal fell apart was documented in this ESPN piece from September, 2011. This is interesting, because the Wilpons claimed this year that it was Steve Cohen who tried to change the deal at the last minute when that sale fell through earlier this year. But it's the Wilpons who have the history of changing deals at the last minute:
Einhorn said he believed the deal was on track as recently as the middle of last week, but then was troubled when he received modifications to the contract before last weekend.At the time of the Einhorn deal, the Mets desperately needed an influx of cash to try to offset the Madoff losses, yet this deal fell through because they didn't want to give up control of the team. The original contract supposedly had triggers that would allow Einhorn to buy up to a 60% share of the team in 3-5 years. I have little doubt that, if language remained in the contract and the deal was finalized, David Einhorn would be the majority owner of the New York Mets by now. At least, he would be if the mean girls who own the other clubs voted to allow him into the group.
One example, Einhorn said, was that he wanted a clear path from Major League Baseball to gain approval from other owners to become majority owner of the Mets should he successfully exercise that contractual right in a handful of years.
Einhorn, 42, said the Wilpons informed him early on that MLB would have a problem with that language in the contract. So Einhorn indicated he met with Bud Selig, who said that the commissioner's office would not be an impediment to the contract calling for a trigger for other MLB owners to vote to approve him as majority owner should the agreement with the Wilpons eventually call for it.
But, Einhorn alleged, the Wilpons subsequently lobbied MLB to prevent the language calling for a vote of other owners from being included. And the latest contract revisions had omitted the clause that previously had appeared in the agreement, Einhorn said.
"After all, it wouldn't make sense to invest $200 million into a team and then be denied the ability to exercise a negotiated option down the road due to the inability to obtain the required vote of other major league owners at that time," Einhorn said.
Einhorn said that was only one example of several unilateral changes made to the agreement by the Wilpons entering last weekend.
"I was surprised," he said. "I was very surprised."
Returning to the present, I've always found it somewhat hard to believe that a very smart guy like Steve Cohen was willing to pay the Wilpons over $2 billion for the Mets without SNY and not only allow both Fred and Jeff to stick around for 5 years, but actually fully control the Mets for that 5 year period. Now, I understand that Rob Manfred backs the Wilpons up on their accusations that Cohen tried to change the deal, but Manfred basically will believe and swear to anything the owners tell him. Just ask Astros owner Jim Crane.
Anyway, by most accounts Steve Cohen bid the most for the Mets in the first round of bidding. Supposedly he offered $2 billion for the club and another $2 billion for the Wilpon's interest in SNY. According to the Post, Alex Rodriguez and Jennifer Lopez bid $1.7 billion and are still in the hunt. Rumors are that the Wilpons would prefer to sell to someone else besides Cohen if all things are equal, but I'd be curious to see how close Rodriguez and Lopez would need to be. If the numbers reported are true and continue as final bids, I would not expect the Wilpons to spit on $300 million just because their feelings were hurt. It's all speculation right now, so I won't try to guess at any conclusion based on strictly the guesses of others.
The A-Rod/JLo group would bring plenty of back page headlines to the Mets which is either good or bad depending on what they do. Cohen would be more like a traditional owner with deep pockets whose work would be mostly behind the scenes. Again, depending on your perspective, that could be good or bad. The fact is that a change needs to be made, but likely won't because the money and legacy implications will leave the Wilpons looking worse than they already do.
ReplyDeleteI do like the possibility of JLo and ARod being minority owners with Cohen and placed in charge of the entertainment factor at the stadium.
ReplyDeleteWould bring a real expand the talent pool entertaining here.
Much as I dislike A-Rod, if his group wins the bidding it would mean someone in the ownership who has actual MLB experience, both as a player and as "special advisor" to the very successful Yankees owners.
ReplyDeleteThat could turn negative if he meddles with whoever is GM, but more likely it looks like a big +.