Wilpons to sell controlling interest in Mets (or maybe not)

[mauf]

Wall Street mogul (and current Mets minority investor) Steve Cohen is reportedly close to an agreement to purchase an 80% stake in the Mets. The deal values the club at $2.6b. Fred and Jeff Wilpon will remain in their current roles for five years, which presumably means they will continue to control the club during that time.

Mets in Talks to Sell 80% of Team to Investor Steve Cohen

The owners of the New York Mets are in talks to sell up to 80% of the Major League Baseball team to billionaire Steve Cohen, who is already an investor in the club, according to person familiar with the matter.

www.bloomberg.com

 

[santadevil]

Are the Mets really worth $2.6B?
Forbes did show them at $2.3B on their list, so I guess they are probably close, but I just can't believe it

A change in ownership would likely be a good thing for the Mets, but 5 more years would seem like a deal breaker to me, if I was buying (my $2.6B is in my other pants)

 

[shaggydog2000]

So the Wilpons are going to be on the payroll for 10 years less than Bobby Bonilla is going to be?

 

[luckiestman]

Are the Mets really worth $2.6B?
Forbes did show them at $2.3B on their list, so I guess they are probably close, but I just can't believe it

A change in ownership would likely be a good thing for the Mets, but 5 more years would seem like a deal breaker to me, if I was buying (my $2.6B is in my other pants)

Appraisals mean dick. They are worth what someone will pay.

 

[santadevil]

Appraisals mean dick. They are worth what someone will pay.

I totally agree. I'm just blown away that the Mets are potentially worth that much, compared to say, the Dodgers, which was $2.0B seven years ago
For a sport supposedly in decline, these valuations keep going up and up, based on TV deals and I wonder if a bubble is forming


edit: sorry, was editing my comment

 

[luckiestman]

I totally agree. I'm just blown away that the Mets are potentially worth close to what the Yankees are worth
I know which team I would buy if given the choice (the Red Sox)

But I don’t think you could get the Yanks for the same price.

 

[Ale Xander]

I totally agree. I'm just blown away that the Mets are potentially worth that much, compared to say, the Dodgers

Mets have a nicer stadium, in a slightly larger market, on a pricier piece of real estate.

Edit: Actually scratch that, NYC owns Citi Field.

 

[Red(s)HawksFan]

Are the Mets really worth $2.6B?
Forbes did show them at $2.3B on their list, so I guess they are probably close, but I just can't believe it

A change in ownership would likely be a good thing for the Mets, but 5 more years would seem like a deal breaker to me, if I was buying (my $2.6B is in my other pants)

Yeah, it seems strange that Cohen is buying a majority interest in the team but will not get control for five years. He reportedly has long wanted to be an owner, and that's why he invested in the Mets in the first place. The presumption is his infusion of cash is going to enable the team to spend more like the big market team they are. Odd that he'd infuse that cash then not have a say in how the team is run.

 

[santadevil]

Ya, sorry, I was editing my comment once I realized the Mets were at half of the Yankees value...I thought it was around $3.0B for them, not double

 

[Lose Remerswaal]

Mets value goes up when the Wilpons are removed from the picture

 

[Steve Dillard]

Exhibit A in the labor war. Hard to cry poverty with values like this even for weaker (but bigger market) teams.

 

[DukeSox]

Yeah, it seems strange that Cohen is buying a majority interest in the team but will not get control for five years. He reportedly has long wanted to be an owner, and that's why he invested in the Mets in the first place. The presumption is his infusion of cash is going to enable the team to spend more like the big market team they are. Odd that he'd infuse that cash then not have a say in how the team is run.

It's an investment. Cheaper to buy it now than in 5 years. Mets performance doesn't dictate value unless they lose 100 games a year for years in a row

 

[Spacemans Bong]

I’m guessing Cohen sees waiting for five years as worth it to own the team he roots for — he’s from Long Island — rather than the Milwaukee Brewers or something.

The Mets seem like a great opportunity considering how much sports franchises go for. A huge fanbase starved for somebody besides the fucking Wilpons, a great park, a great baseball town that will embrace the Mets if they’re hot.

 

[santadevil]

It's an investment. Cheaper to buy it now than in 5 years. Mets performance doesn't dictate value unless they lose 100 games a year for years in a row

I guess, but what about the Wilpon's has recently has screamed "Be my investment steward" for the next 5 years
His purchase and control of 80% would be roughly $2.1BHe would be essentially giving them control of 15.3% of his net worth with this purchase (based on a net worth of $13.6B, per wikipedia)

This is where I'm wondering if there is a bubble. It's tough to assume that values will continue to increase at the pace they have been on for the past 20 years.
There is still only so much money and I would expect a few of these TV contracts will actually be losers for the companies doling them out and they won't continue to increase

However, I may be totally wrong and advertising dollars (which are the real driver here) may continually go up and up

edit/ Also, as I read @Spacemans Bong post, I figured I should paraphrase a member's signature here, whom I can't remember
"People don't get into the ownership side to make money"

So maybe this is just a hometown thing, where a fan has a chance to buy "his" team.
I'm sure most of us would do it if given the oppotunity

 

[johnmd20]

I guess, but what about the Wilpon's has recently has screamed "Be my investment steward" for the next 5 years
His purchase and control of 80% would be roughly $2.1BHe would be essentially giving them control of 15.3% of his net worth with this purchase (based on a net worth of $13.6B, per wikipedia)

This is where I'm wondering if there is a bubble. It's tough to assume that values will continue to increase at the pace they have been on for the past 20 years.
There is still only so much money and I would expect a few of these TV contracts will actually be losers for the companies doling them out and they won't continue to increase

However, I may be totally wrong and advertising dollars (which are the real driver here) may continually go up and up

edit/ Also, as I read @Spacemans Bong post, I figured I should paraphrase a member's signature here, whom I can't remember
"People don't get into the ownership side to make money"

So maybe this is just a hometown thing, where a fan has a chance to buy "his" team.
I'm sure most of us would do it if given the oppotunity

There are only so many baseball teams. They are literally not fungible. So Cohen offloads some of his net worth to get a chance to buy the team in 5 years. Meanwhile, I feel like Cohen should be at least ok living on 11 billion dollars. Nobody is going to need to pass around a hat for him.

edit - it is awesome the Wilpons, ponzi scheme beneficiaries, are selling to Cohen, an inside trader who basically ran his fund like a mob boss. The criminality trickles down.

 

[Vinho Tinto]

There are only so many baseball teams. They are literally not fungible. So Cohen offloads some of his net worth to get a chance to buy the team in 5 years. Meanwhile, I feel like Cohen should be at least ok living on 11 billion dollars. Nobody is going to need to pass around a hat for him.

edit - it is awesome the Wilpons, ponzi scheme beneficiaries, are selling to Cohen, an inside trader who basically ran his fund like a mob boss. The criminality trickles down.

Agreed. It's as much as an investment as his famous art collection.

He was interested in the Dodgers, which made more financial sense, but he wants the Mets on a personal level. He gives a good amount of money to charity, but I wouldn't expect him to join the Gates Giving Pledge. What's the point of making the people who work for you miserable if you just die with a bunch of money?

 

[Gdiguy]

There are only so many baseball teams. They are literally not fungible. So Cohen offloads some of his net worth to get a chance to buy the team in 5 years. Meanwhile, I feel like Cohen should be at least ok living on 11 billion dollars. Nobody is going to need to pass around a hat for him.

This may have been the only way to do the deal, anyway - the Wilpons clearly enjoy the perks of owning a baseball team, but (nominal actual owner Fred) is 83, so '5 years' could easily equal 'still be owner for the rest of his life, but get the money now'

 

[OCST]

I'm surrounded by die-hard Mets fans who will be thrilled taht it's anybody but the Wilpons.

 

[crow216]

I'm surrounded by die-hard Mets fans who will be thrilled taht it's anybody but the Wilpons.

Yea. No question this is amazing news for Mets fans. Also, nobody knows the arrangement yet that will be finalized. Wilpons may still have titles and "control" in name but ultimately all the real decisions could fall the Cohen. Or perhaps Cohen is responsible for selecting staff, GMs, analytics teams, coaches..etc.

 

[Ale Xander]

I seem to have read somewhere that Cohen is the inspiration behind the Axelrod character on Billions. Is this true?

 

[crow216]

Probably. Cohen is/was a huge name in the world of finance. He's Marc Cuban without the TV personality.

 

[wade boggs chicken dinner]

I guess, but what about the Wilpon's has recently has screamed "Be my investment steward" for the next 5 years
His purchase and control of 80% would be roughly $2.1BHe would be essentially giving them control of 15.3% of his net worth with this purchase (based on a net worth of $13.6B, per wikipedia)

You know that's not really the way it works, right?

As someone said above, it a person really really wants to be an owner of a baseball team, you jump in when you have a chance because there is no telling whether that chance will come up again. There was someone who was going to let the Wilpons control the asset for a few years in order to gain control of the Mets.

It's along the lines of the deal Steve Bisciotti made with Art Modell. He purchased 49% of the interests but had the right 4 years later to purchase the rest of it. So for four years, Bisciotti infused the money but Modell made the decisions.

 

[Van Everyman]

Probably. Cohen is/was a huge name in the world of finance. He's Marc Cuban without the TV personality.

Um, that's underselling things a bit.

Anyone who thinks allowing Steve Cohen to own a professional sports franchise is a good idea should watch this: https://www.pbs.org/wgbh/frontline/film/to-catch-a-trader/

The dude is absolute poison and the fact that he's still anywhere near Wall St. is merely a reflection of what a toothless piece of shit the SEC is.

 

[crow216]

Um, that's underselling things a bit.

Anyone who thinks allowing Steve Cohen to own a professional sports franchise is a good idea should watch this: https://www.pbs.org/wgbh/frontline/film/to-catch-a-trader/

The dude is absolute poison and the fact that he's still anywhere near Wall St. is merely a reflection of what a toothless piece of shit the SEC is.

Yes, agreed. I was just trying to say that by no means is he an unfamiliar name. He's a celebrity for a lot of bad reasons.

 

[mauf]

Yea. No question this is amazing news for Mets fans. Also, nobody knows the arrangement yet that will be finalized. Wilpons may still have titles and "control" in name but ultimately all the real decisions could fall the Cohen. Or perhaps Cohen is responsible for selecting staff, GMs, analytics teams, coaches..etc.

This was my thought as well. If the deal goes through, I’m sure there will be restrictions on the Wilpons going forward that are much more significant than whatever protections for minority investors exist in the club’s current governing documents.

The unusual arrangement might also be designed to facilitate MLB’s approval of Cohen as a majority owner. I’m sure a lot of other owners would prefer that someone else buy the Mets, but they would also like to be rid of the Wilpons and don’t want to get sued if franchise values dip in the next several years. Cohen’s willingness to do a deal most others wouldn’t makes it harder for MLB to say no.

 

[bankshot1]

I wonder if the purchase is structured that his $2b purchase to the Wilpon's (less whatever taxes) goes back to his fund to manage at 2/20 (or maybe a modest Mets discount) and they trade up from Madoff to Cohen managing their dough.

And agree on the 5-year waiting period to satisfy MLB's concern about Cohen's character etc.

 

[Monbo Jumbo]

The FEDs have been trying to nail Steve Cohen for insider trading for years. (They did bag a couple of his subordinates.) He's the perfect owner for the sign-stealing era.

 

[santadevil]

You know that's not really the way it works, right?

That's why there was an edit at the bottom, even though you replied to only the first part
I was posting and revising my thinking at the same time, which probably wasn't the best idea

 

[RedOctober3829]

Does anyone know if the sale includes SNY?

 

[crow216]

The FEDs have been trying to nail Steve Cohen for insider trading for years. (They did bag a couple of his subordinates.) He's the perfect owner for the sign-stealing era.

and for the Mets. Where there is drama, there are the New York Mets. They couldn't even avoid the sign-stealing debacle and they're not in the same league.

 

[bankshot1]

Does anyone know if the sale includes SNY?

From what I read its not, which seems strange as it seems the two assets, the team and TV network derive a lot of value from each other. I would assume an eventual sale (within the 5 yr period) of SNY to Cohen would addressed.

As an aside listening to WFAN, Betts to the Mets is seen as a natural extension of Cohen ownership. .

 

[HowBoutDemSox]

I wonder if the purchase is structured that his $2b purchase to the Wilpon's (less whatever taxes) goes back to his fund to manage at 2/20 (or maybe a modest Mets discount) and they trade up from Madoff to Cohen managing their dough.

2/20 would be a discount for Cohen; he was supposedly at 3/50 (not a typo) before his brief hiatus from managing outside capital, though now it’s a more complicated structure where he passes on come costs directly to his investors.

If anyone is interested in an account of the feds going after Cohen earlier in the decade (the initial inspiration for Billions, as noted) I recommend Black Edge by Sheelah Kolhatkar.

 

[dhappy42]

Times article with some unflattering anecdotes about Jeff Wilpon.

Fans Didn’t Like the Way Jeff Wilpon Ran the Mets. Neither Did Some of His Relatives.

Fans Didn’t Like the Way Jeff Wilpon Ran the Mets. Neither Did Some of His Relatives.

The Wilpons had limited successes after becoming majority owners of the Mets in 2002. But the team’s dysfunction was mirrored by the family discord that ultimately forced a sale.

www.nytimes.com

 

[InstaFace]

edit - it is awesome the Wilpons, ponzi scheme beneficiaries, are selling to Cohen, an inside trader who basically ran his fund like a mob boss. The criminality trickles down.

This is an understatement on both counts.

The Wilpons were sued to pay back their ill-gotten gains in 2010, almost sold the team in 2011, settled it in 2012, finally agreed to pay the balance in 2016 by deferring it with some interest (it's the Bobby Bonilla plan!), and they still have a balance of $15.2M to pay. So they've essentially gotten out of having to reckon with their ill-gotten gains for almost a decade, while paying well-below-market interest rates.

But Steve Cohen is as dirty as the day is long, and everyone on wall street knows it. He kept himself out of Federal PMITA prison, but only barely. He would make the average NFL owner look like a paragon of virtue. I find it hard to believe that Manfred thinks that's a net improvement in the Mets' ownership situation to be owned by a savvy criminal rather than an arrogant fool.

(Fun fact: Let's also remember that Cohen almost bought 49% in 2015 as part of the Wilpons' various dealings to try and avoid JP Morgan or David Einhorn from owning the team - and likely at something less than 100 cents on the dollar).

Um, that's underselling things a bit.

Anyone who thinks allowing Steve Cohen to own a professional sports franchise is a good idea should watch this: https://www.pbs.org/wgbh/frontline/film/to-catch-a-trader/

The dude is absolute poison and the fact that he's still anywhere near Wall St. is merely a reflection of what a toothless piece of shit the SEC is.

Yep. It would actually be hard to find a worse actor in the financial system who isn't already in prison. Joseph Cassano, maybe? Probably not. In a near-zero-sum market, the billions Steve Cohen possesses have essentially been stolen from ordinary investors, who would have gotten those gains but-for Cohen making the trade first.

 

[Red(s)HawksFan]

Cohen apparently backing out of his deal to buy majority stake in the Mets. The whole buy in but not take control for five years seemed screwy to me from the start.

View: https://twitter.com/Ken_Rosenthal/status/1224800018038771714

 

[johnmd20]

Cohen apparently backing out of his deal to buy majority stake in the Mets. The whole buy in but not take control for five years seemed screwy to me from the start.

View: https://twitter.com/Ken_Rosenthal/status/1224800018038771714

The Wilpons are criminals. Cohen's lawyers obviously looked at the financials and realized it was a money pit of loss and failure. And possible fraud.

MLB really needs to step in at some point.

 

[soxhop411]

@mauf we need a title change:

The future of the New York Mets revolving around potential new owner Steve Cohen might not be as concrete as first believed.

A source with knowledge of the situation has told amNewYork Metro that the billionaire’s acquisition of the Mets has fallen through, with an announcement coming as soon as this week.

The source told amNewYork that some of the demands from the Wilpon Family regarding their removal accelerated the disintegration of the deal.

Mets sale between Wilpons, billionaire Steve Cohen teeters on brink, source says - amNewYork

The future of the New York Mets revolving around potential new owner Steve Cohen might not be as concrete as first believed. A source with knowledge of

www.amny.com

 

[jon abbey]

I put in a placeholder title for now, the Mets are the best.

 

[santadevil]

Interesting

I hope information leaks out as to what the cause in this change of mind comes from

 

[nattysez]

This sounds more to me like Cohen negotiating hard by "walking away." I bet the Wilpons will come crawling back to the negotiating table with some concessions unless some other Mets-loving hedge-fund manager gets a bid together.

 

[bankshot1]

Just heard on WFAN that according to the NY Post the Wilpons changed the terms of the deal at the last minute, and Cohen walked.

 

[Van Everyman]

Hmm. I wonder whether Manfred could’ve stepped in.

 

[Marciano490]

The Wilpons are criminals. Cohen's lawyers obviously looked at the financials and realized it was a money pit of loss and failure. And possible fraud.

MLB really needs to step in at some point.

Imagine SAC thinks you’re too shady to deal with?

 

[bankshot1]

Manfred: Cohen out

Manfred: Mets sale from Wilpons to Cohen off

Baseball commissioner Rob Manfred says talks have ended over the proposed sale of a controlling share of the New York Mets from the families of Fred Wilpon and Saul Katz to hedge fund manager Steven Cohen.

www.espn.com

ORLANDO, Fla. -- Baseball commissioner Rob Manfred says talks have ended over the proposed sale of a controlling share of the New York Mets from the families of Fred Wilpon and Saul Katz to hedge fund manager Steven Cohen.

"There is not going to be a transaction," Manfred said at the end of an owners meeting. "I can tell you, and it's based on conversations with the buyer and the seller on an ongoing basis, the assertion that the transaction fell apart because of something the Wilpons did is completely and utterly unfair."

 

[E5 Yaz]

 

[bankshot1]

Nothing but Mets mishigas since '86

 

[santadevil]

With the A-Rod as a potential buyer being discussed already, I find it hilarious that this initial deal fell through because Cohen didn't read the fine print about the 5 years of control being retained by the Wilpons

If we at SoSH saw it, how does this guy who cheated his way to a $13B net worth not figure it out?

 

[Van Everyman]

I’m guessing the guy who cheated his way to $13B thought he could pull one over on the Wilpons the way Madoff did.

 

[johnmd20]

I’m guessing the guy who cheated his way to $13B thought he could pull one over on the Wilpons the way Madoff did.

The Wilpon's entire business was financed by Madoff gains. The only reason they could buy the Mets was because of Madoff.

The Wilpon's might not be criminals, (although that could be debatable), they were beneficiaries of the Madoff scam. For decades.

 

[Marciano490]

The Wilpon's entire business was financed by Madoff gains. The only reason they could buy the Mets was because of Madoff.

The Wilpon's might not be criminals, (although that could be debatable), they were beneficiaries of the Madoff scam. For decades.

Is that true? How do the gains not get clawed back? I’m guessing the law doesn’t work that way, but it seems like a bs way to handle a Ponzi scheme fallout.