The Mets Ownership / Management Thread

[Mongoose]

The one thing I don't take at face value is the claim the Mets lost $70 million this year. Between the team and SNY they have to be operating at a profit. I'm not a loan officer by trade, but the Wilpons must have some equity in the team, some kind of positive cash flow - otherwise banks wouldn't keep lending them money.

I can only presume they're draining money from the team to cover losses in their real estate holdings, and lying that the losses are coming from the Mets to justify slashing of payroll.

[MattD1972]

Please, God, let the information about the commissioner's office be true. There is something massively wrong when you're 1.4 Billion in the hole (add the figures in the Klapisch article), and still getting more loans. Even Colangelo wasn't this bad when he ran the DBacks.

[PVNICK]

Maybe I misheard but on the radio (FAN?) this morning I heard they had to take a $40,000,000 (40 million) loan from MLB to cover themselves while selling, or trying to, minority shares. If I heard that correctly then I doubt they are finding anyone willing to donate, I mean purchase a minority interest. Perhaps the loan and the comments about MLB beign sick of them are realted. One can only hope.

[milladrive]

Missed this little snippet:

A source close to the baseball commissioner’s office recently told the Post that the league is finally had enough of enabling the Wilpons.

I'm always skeptical when I hear it was printed in the Post. I hope it's true, but I'll believe it when I see some pro-active backing of the words. Can't get my hopes up yet, but my fingers are crossed, hoping it's true.

[mandrake]

I'm always skeptical when I hear it was printed in the Post. I hope it's true, but I'll believe it when I see some pro-active backing of the words. Can't get my hopes up yet, but my fingers are crossed, hoping it's true.

I'm skeptical about the Won't-pons , period. Why Bud jumped into the Dodgers mess and allows this disgrace to go on is beyond me. At least McCourt is probably going to make a $600 million dollar profit with his mishandling of the Dodgers.....how much will Fred make if he is selling the team? I wonder if he will be able to cover his debts.

Just keep the faith that Picard will win the lawsuit, and the second M. Donald Grant era will be over.

[GordonGecko]

the Wilpons must have some equity in the team, some kind of positive cash flow - otherwise banks wouldn't keep lending them money.

The team would sell for about $1B, and they now have debts of $580M (not including the hundreds of millions owed on Citi Field in a separate entity). So there's plenty of equity there to lend against, even if you assume the team is only worth $600-700m

[Mongoose]

That is the question at the moment, since the New York Times reported Monday evening that Bank of America provided Wilpon and his partners with a $40 million bridge loan, even though between debt against the team, against their television network, and against Citi Field, the ownership group has around $1.5 billion in debt at the moment. That doesn't include a penny of what they might need to pay in the lawsuit brought against them by a trustee for the victims of Bernie Madoff's Ponzi scheme, in which the Wilpon group was adjudged to have been a net "winner."

In reality, even if everything in the current plan goes right, the Wilpon group doesn't have any obvious pathway to solvency. And the latest news simply reinforces the notion that the Mets owners have run out of money, and are also running out of time.

This latest bridge loan is supposed to get the team's owners through to March, by which point, they claim, they'll be able to raise $200 million by selling off ten separate minority ownership stakes in the Mets.

According to the bank's financing statement, the loan is due back five years from the date of the agreement—November 28, 2016. But that is likely a date created to reassure the other lenders that Bank of America won't jump the line in the event of a bankruptcy.

And the Mets confirmed late Monday night that they will pay the approximately $25 million to the city of New York, which is the latest of the twice-annual debt installments due on Citi Field.

It represents just the latest in the obstacle course of debt the Wilpon group is picking its way through in an attempt to keep the team and avoid bankruptcy.

This latest loan of $40 million, to be paid back in March, is largely needed to pay that Citi Field debt. So let's look at the team's finances, acting under the assumptions that the Mets pay off that debt, and that the $40 million in Bank of America money gets them through the winter.

Come March, if the team has completed deals with ten minority investors for approximately $200 million—an extraordinarily tall order—$40 million gets paid back for the bridge loan. Another $25 million, owed to Major League Baseball and currently past due, also gets repaid.

That leaves $135 million to get them through the season with a team that lost $70 million last year. While salaries have been slashed—approximately $50 million has come off of the payroll, and most of the Mets' top players have been jettisoned—it is reasonable to expect that they won't draw more fans than they did last year, even at a discount. And with ticket prices cut as well, what tickets do sell won't bring in as much revenue as they did in 2011.

But let's be extremely optimistic, and estimate the team loses just $35 million next year. That leaves $100 million. That's just about enough to cover the two more debt payments against Citi Field, the $30 million in interest on the debt against the team, and the $20 million in interest on the debt against SNY.

And it doesn't address some other massive issues for this ownership group: the $430 million in debt against the team (due in 2014), the $450 million in debt against SNY (due in 2015), or even a penny of the massive legal fees they'll be paying to fight the Madoff lawsuit, with a trial date set for March 19 of next year. Oh, and they'll owe $200 million, plus 3 percent per year, to their ten minority investors in 2017.

So the best-case scenario places them right back in this position a year from now—on the brink.

So then why did Bank of America lend these people the money at all? And why did the other lenders go along with it?

For Bank of America, which holds a substantial portion of the team's SNY debt, keeping the Wilpon group around in the hope of getting back back some money makes more sense than bailing on them and entering a bankruptcy proceeding with the other lenders. What would follow—and what is an eventuality if the lenders can't nurse the Wilpon ownership back to health—is a free-for-all with massive claims to be paid to a multitude of creditors.

And what will exist to pay them? The sale of a team whose value isn't greater than the debt owed against it and its stadium and a TV network, SNY, that isn't worth much without a deal to show Mets games.

And rest assured, a new team owner, who may or may not own SNY as well, is going to pay attention to the $150 million per year the Angels recently received for their television rights, and contrast it to the $63 million per year SNY pays the Mets. One way or another, that model will change, and not to SNY's benefit.

Once again, none of this includes any potential judgment against Wilpon and his partners in the Madoff suit. That potential burden currently stands at $386 million, with the potential to rise on appeal, and not including substantial legal fees to fight the battle along the way.

Two endings are likely here.

One is that the Wilpon ownership group misses a payment. This week's debt payment to the City of New York could have done it, for example, but the loan allowed them to keep going. It's hard to see how they'll manage to avoid missing a payment if they fail to find minority investors by March. If they do, it will likely be the point at which the lenders give up on them and race to the front of the line for bankruptcy.

Another possible ending is that Major League Baseball enforces its own rules regarding debt—the Wilpon ownership group has been in violation of them for at least three years now—and forces a sale of the team. As a statement from the team made clear last night, M.L.B. signed off on the new loan, just as M.L.B. has allowed the Mets to owe them $25 million long beyond the agreed deadline for repayment.

It is hard to believe that the banks and M.L.B., which is watching one of its marquee clubs shrivel and turn to dust before its very eyes, will keep pretending everything is OK for much longer.

http://www.capitalnewyork.com/articl...group-how-long

Disgusting.

[mandrake]

Mongoose, where to start? Well, I would say that 95% of all people know that the Wilpons are in huge trouble, which only seems to be getting worse. Think of this in smaller terms; there are many people who lived a lifestyle that was probably way over their heads. They maintained that lifestyle with credit cards, student loans, car payments, refinancing, etc....until their income could no longer keep up, or their equity crashed. The Wilpons did this on a much greater scale than most of us can imagine.

Fred and Lil Jeff wanted to be the Steinbrenners; the Dolans; Arte Moreno; Mark Cuban. The problem is their money was tied into a collapsing real estate market and whatever cash they had was tied into a crook. When both happened at the same time, they had no choice but to try to borrow their way out of the mess.

I would say that a huge majority of Mets fans want the "Won't-pons" to sell. There are a handful on BF that always defend them as 'our owners/our team'...but they really just want to be contrary and stir things up. I doubt anyone is really foolish enough to actually want Picard's suit to "die on the vine".

What I always wondered about is why the most devoted Wilpon fans always seemed to HATE the opposition the most. It is not the Yankees fault that Wilpon has ruined the franchise, nor is it the Braves, Phillies, or now Marlins fault. The pom-pon squad will blame everyone and anyone except the people really responsible: Fred and Jeff.

Outside of some people here, do you really think anybody in the United States gives a crap that the Mets will have blue walls in 2012? (why not green like they were at Shea for 20 years??) But the owners can let Reyes walk without an offer, for less money than the Mets pay Jason Bay, and people on here are thrilled that the walls
will be blue.

The Mets were shopping just about everyone at the recent meetings. Nobody wants Jason Bay's salary, let alone give something for him. Santana....the Mets are stuck for FIFTY MILLION bucks.

Why were they shopping Pelfrey?Niese?Murphy?Davis? These guys are not breaking the bank !

But someone on here will be bragging that they can now pay $10 for a draft beer in the Prom club so Fred is a great owner.

One of the names suggested for the new NL baseball franchise was Islanders. I think Bill Shea was onto something when he brought to life both franchises and put the same colors on both teams. The Mets have become the Islanders of MLB.

[Mongoose]

Mongoose, where to start? Well, I would say that 95% of all people know that the Wilpons are in huge trouble, which only seems to be getting worse. Think of this in smaller terms; there are many people who lived a lifestyle that was probably way over their heads. They maintained that lifestyle with credit cards, student loans, car payments, refinancing, etc....until their income could no longer keep up, or their equity crashed. The Wilpons did this on a much greater scale than most of us can imagine.

Fred and Lil Jeff wanted to be the Steinbrenners; the Dolans; Arte Moreno; Mark Cuban. The problem is their money was tied into a collapsing real estate market and whatever cash they had was tied into a crook. When both happened at the same time, they had no choice but to try to borrow their way out of the mess.

I would say that a huge majority of Mets fans want the "Won't-pons" to sell. There are a handful on BF that always defend them as 'our owners/our team'...but they really just want to be contrary and stir things up. I doubt anyone is really foolish enough to actually want Picard's suit to "die on the vine".

What I always wondered about is why the most devoted Wilpon fans always seemed to HATE the opposition the most. It is not the Yankees fault that Wilpon has ruined the franchise, nor is it the Braves, Phillies, or now Marlins fault. The pom-pon squad will blame everyone and anyone except the people really responsible: Fred and Jeff.

Outside of some people here, do you really think anybody in the United States gives a crap that the Mets will have blue walls in 2012? (why not green like they were at Shea for 20 years??) But the owners can let Reyes walk without an offer, for less money than the Mets pay Jason Bay, and people on here are thrilled that the walls
will be blue.

The Mets were shopping just about everyone at the recent meetings. Nobody wants Jason Bay's salary, let alone give something for him. Santana....the Mets are stuck for FIFTY MILLION bucks.

Why were they shopping Pelfrey?Niese?Murphy?Davis? These guys are not breaking the bank !

But someone on here will be bragging that they can now pay $10 for a draft beer in the Prom club so Fred is a great owner.

One of the names suggested for the new NL baseball franchise was Islanders. I think Bill Shea was onto something when he brought to life both franchises and put the same colors on both teams. The Mets have become the Islanders of MLB.

Another tactic of closeted Wilpon fans is to regurgitate the Alderson defense and say it was a good move not to resign Reyes because he was too expensive/injured too much. If the Mets had bothered to make an offer I'm sure he'd have taken less to stay, but I guess we'll never know.

[trepye]

Has the New York Mets ownership group become too big too fail?

Come March, if the team has completed deals with ten minority investors for approximately $200 million—an extraordinarily tall order—$40 million gets paid back for the bridge loan. Another $25 million, owed to Major League Baseball and currently past due, also gets repaid.

If any of these investors ever want to have the whole team why would they ever enable the teams unavailability by bridging the Wilpons by owning a little insignificant piece of it. They should sit on their funds till the Wilpons break and are forced to sell, put a ownership group together and buy a biggers portion of it at a devalued price (devalued thanks to their atrocious management).

More bang/control for their buck, but most importantly, a franchise under new management.

[GordonGecko]

But someone on here will be bragging that they can now pay $10 for a draft beer in the Prom club so Fred is a great owner.

Mets die-hards should take one for the team and sit out this season. Wilpons are teetering on the edge, all they need is a little push and then a wave of fresh money will come in to replace Fred and his idiot son Jeff

[richiek]

According to the Daily News:

http://www.nydailynews.com/sports/ba...ticle-1.991269

MLB is banking on Mets woes and may jump to take control as Wilpons will soon feel the financial squeeze
Source says cash crisis on club may go beyond control of Bud & Co.


On the day after word was leaked of the Mets taking out yet another loan, here is what you heard Tuesday from Major League Baseball officials: The walls are closing in on the Wilpons.

Nobody was saying that Bud Selig is ready to give the Mets owners the Frank McCourt treatment, and start chasing them toward the door. But neither was there any mistaking the growing concern from inside the MLB offices about the state of the franchise.

“They have a lot of things coming due,” was the way one MLB official put it. “They need some things to happen fairly soon.”

The official went on to explain that the banks, more so than MLB, are likely to start squeezing the Wilpons.

“They’re sort of at the end here with the banks and everything else,” the official said.

Suffice to say there is now a level of pessimism among MLB people about whether the Wilpons are going to survive their financial problems, which have become more of a topic of conversation than ever since Sandy Alderson told the world last week the Mets recently lost $70 million unrelated to the ongoing Bernie Madoff matter.

[GordonGecko]

So what sort of moron is going to give them a $20 million investment (*cough* donation *cough*) given the current state of affairs, let alone 10 such morons. The only way is if there's a piece of paper that clearly states, "if you go broke, I can buy your entire franchise".

This is the end of the line for the Brooklyn Dodger nostalgics.

[mandrake]

http://content.usatoday.com/communit...ets-finances/1

Another gloomy report, with this tidbit:

Alderson said the club expects an influx of cash in the next month or two from the sale of the shares, but he also revealed further bad news when he said staff ace Johan Santana may not be ready to start the season.

[Mongoose]

http://content.usatoday.com/communit...ets-finances/1

Another gloomy report, with this tidbit:

Alderson said the club expects an influx of cash in the next month or two from the sale of the shares, but he also revealed further bad news when he said staff ace Johan Santana may not be ready to start the season.

Remember when Fred and Jeff were trying to rush Santana back from the surgery so he could pitch a few meaningless games in September and he reinjured himself? Sort of like how they played Church/Bay with concussions? Or how they wanted Beltran to play injured and not get his surgery? And how they ran various other players into the ground?

Typical.

[Paulypal]

http://content.usatoday.com/communit...ets-finances/1

Another gloomy report, with this tidbit:

Alderson said the club expects an influx of cash in the next month or two from the sale of the shares, but he also revealed further bad news when he said staff ace Johan Santana may not be ready to start the season.

Remember when Fred and Jeff were trying to rush Santana back from the surgery so he could pitch a few meaningless games in September and he reinjured himself? Sort of like how they played Church/Bay with concussions? Or how they wanted Beltran to play injured and not get his surgery? And how they ran various other players into the ground?

Typical.

My question is why did MLB take so long? They borrowed the 25 million over a year ago, and didnt pay it back at all during the season when cash flow should be at its peak.

Also if they did lose 70 million they didnt lose it in the last month. What I mean is that they knew they were losing money during the whole season. They didnt wake up on October 1st and realized they lost money. I am sure they compile a monthly financial statement. My point is if they had losing months during the season, if the attendance was dropping like a rock, and they were playing losing baseball with no sign of a turnaround....Why didnt MLB jump in earlier? July? August?.

Maybe if they jump in earlier they figure out a way to retain Reyes. Or at least be involved in a few free agents to make it interesting. Because right now 2012 is already dead. In all honesty the fact that MLB didnt jump in last off season is absurd. They team was looking down the barrel of a billion dollar law suit from Picard. They borrowed 25 million....a NY team had to borrow money. That was the sign to jump in.

As far as Santana goes. Typical. I remember several years ago when the Cubs couldnt keep Mark Prior on the field. Prior if you remember was awesome, but just couldnt stay healthy. The Mets the last 4 years have had a roster full of Prior's.

[Strawman]

My question is why did MLB take so long? They borrowed the 25 million over a year ago, and didnt pay it back at all during the season when cash flow should be at its peak.

Also if they did lose 70 million they didnt lose it in the last month. What I mean is that they knew they were losing money during the whole season. They didnt wake up on October 1st and realized they lost money. I am sure they compile a monthly financial statement. My point is if they had losing months during the season, if the attendance was dropping like a rock, and they were playing losing baseball with no sign of a turnaround....Why didnt MLB jump in earlier? July? August?.

Maybe if they jump in earlier they figure out a way to retain Reyes. Or at least be involved in a few free agents to make it interesting. Because right now 2012 is already dead. In all honesty the fact that MLB didnt jump in last off season is absurd. They team was looking down the barrel of a billion dollar law suit from Picard. They borrowed 25 million....a NY team had to borrow money. That was the sign to jump in.

As far as Santana goes. Typical. I remember several years ago when the Cubs couldnt keep Mark Prior on the field. Prior if you remember was awesome, but just couldnt stay healthy. The Mets the last 4 years have had a roster full of Prior's.

MLB did jump in a year ago ... His name is Alderson. They jumped in badly. We need the geniuses that run baseball to go McCourt on the Mets rather than Alderson.

[Paulypal]

MLB did jump in a year ago ... His name is Alderson. They jumped in badly. We need the geniuses that run baseball to go McCourt on the Mets rather than Alderson.

I meant, as you know, why didnt they take over baseball operations exactly how they did it with the Expos, and the more recently the Dodgers. Yes they sent Alderson but they sent him her to cut payroll. I meant, again, as you know, to take it over.

Hey your thread was kept open by the grace of God...or in this case the grace of Milladrive....dont dirty up this one.

[MattD1972]

http://hardballtalk.nbcsports.com/20...david-einhorn/

Was it this depressing when Don Grant and the DeRoulets ran things?

[milladrive]

http://hardballtalk.nbcsports.com/20...david-einhorn/

Was it this depressing when Don Grant and the DeRoulets ran things?

Oddly enough, in this poster's opinion, not nearly as bad. Grant was merely a spiteful (to put it nicely) GM with a huge ego, while the de Roulets were simply inept. Fredo Wilpon and company are corrupt. I'll take spiteful and inept any day over corrupt.

[mandrake]

http://www.nypost.com/p/news/busines...IhqQVSAs0yuQgM

Mets owner Fred Wilpon asked baseball commissioner Bud Selig to “play the bad cop” and help him scuttle a deal that could have resulted in him losing majority control of the team, a new bombshell book reports.

Earlier this year, hedge-fund titan David Einhorn was set to invest $200 million for a 17 percent minority stake in the Mets.

In exchange, Wilpon agreed that if the team didn’t repay Einhorn in five years, he would be able to acquire a majority stake for a nominal amount.

But months after Wilpon agreed to the deal, he got cold feet, fearing he could lose control of the team.

“Wilpon asked Selig to strike the provision requiring him to enable and assist David Einhorn in his pursuit of majority ownership, if Wilpon couldn’t repay him,” author Howard Megdal writes in “Wilpon’s Folly.”

“The idea would be that Selig would play the bad cop. When Major League Baseball put the kibosh on Einhorn, Wilpon would have plausible deniability, and could throw up his hands and say, ‘What can I do? This is how MLB works.’”

Einhorn heard about the dealings and, on Sept. 1, had a heated discussion with Wilpon that resulted in Einhorn walking away from the deal, according to the book.

MLB lawyer Rob Manfred said, “I don’t believe the account in the book is accurate. I think the reason the deal did not come to fruition is the two parties did not have a meeting of the minds on a key provision in the deal.”

A Mets spokesman said, “The author’s desperate self-promotional campaign for relevance has led to perpetuating baseless speculation and complete inaccuracies.”

Megdal told The Post he stands by his reporting. An Einhorn spokesman declined comment.

You can't make this stuff up. Frank McCourt, are you listening? Better yet, are your lawyers listening?

[Strawman]

Everyone here should read Howard Megdal's new e-book referenced in the articles above - Wilpon's Folly. I've just read it. Great, well-researched story of the Mets ownership and its mountain of leveraged debt. Reading this book, it's clear there's no way the Wilpons can survive. But they can fight an ongoing war of attrition, possibly for years, with Alderson as their slightly-detached Moneyball-style field general. There's no good scenario here. When the collapse of the Einhorn deal went down last summer, that pretty much guaranteed a long era of suffering for Mets fans.

Get the book here:
http://www.amazon.com/Wilpons-Folly-.../dp/B006MCS1ZQ

[Mongoose]

Everyone here should read Howard Megdal's new e-book referenced in the articles above - Wilpon's Folly. I've just read it. Great, well-researched story of the Mets ownership and its mountain of leveraged debt. Reading this book, it's clear there's no way the Wilpons can survive. But they can fight an ongoing war of attrition, possibly for years, with Alderson as their slightly-detached Moneyball-style field general. There's no good scenario here. When the collapse of the Einhorn deal went down last summer, that pretty much guaranteed a long era of suffering for Mets fans.

Get the book here:
http://www.amazon.com/Wilpons-Folly-.../dp/B006MCS1ZQ

Not news to me:

...The only way Fred's going to make it out of this is by selling the whole team.

Looks like Fred is finally toast. Knowing him he won't sell until he's forced to. Get ready for 1979 Mets baseball at Yankees prices.

That quote was from the beginning of the year. I've been saying pretty much the same thing since the whole Madoff story broke way before that.

Wilpon's not a good man. Somehow he got good press for years, and can create rapport with some pretty important people. If you look at his actions, though, he's demonstrated a hardball, slash-and-burn manner in dealing with Doubleday, his neighbors, his fans: practically everybody! I predicted Megdal's basic conclusion from the beginning. Anyone who'd watched this ownership over the years could have.

[milladrive]

Not news to me:

...The only way Fred's going to make it out of this is by selling the whole team.

Looks like Fred is finally toast. Knowing him he won't sell until he's forced to. Get ready for 1979 Mets baseball at Yankees prices.

That quote was from the beginning of the year. I've been saying pretty much the same thing since the whole Madoff story broke way before that.

Wilpon's not a good man. Somehow he got good press for years, and can create rapport with some pretty important people. If you look at his actions, though, he's demonstrated a hardball, slash-and-burn manner in dealing with Doubleday, his neighbors, his fans: practically everybody! I predicted Megdal's basic conclusion from the beginning. Anyone who'd watched this ownership over the years could have.

I must admit, you called it. I think some us were in denial for a while until the facts were learned. I know I didn't wanna believe it. But now, with thanks in good part to your input and insight, I've done a 180. I guess sometimes it takes another mind to help change others'.

[Strawman]

I must admit, you called it. I think some us were in denial for a while until the facts were learned. I know I didn't wanna believe it. But now, with thanks in good part to your input and insight, I've done a 180. I guess sometimes it takes another mind to help change others'.

I have to agree - Mongoose was all over it, especially the myriad finance issues, quite a ways back.