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The Mets are close to closing on five of those $20 million ownership stakes

Jan 11, 2012, 9:00 AM EDT

mets logo hat AP

The New York Daily News reports that the New York Mets are close to sealing the deal on five of the $20 million shares they’ve been trying to sell. The owners have been approved by Major League Baseball and the deals could close by the end of the month.  The Daily News:

With that, the team would raise enough capital to repay $25 million owned to MLB, a $40 million bridge loan to Bank of America and other club debts and operating expenses that have emerged in the wake of the Bernie Madoff Ponzi scheme scandal.

There is a reported overall total of $350 million in debt — and the team has reportedly lost money in recent years — so that doesn’t handle everything. But it’s better than nothing.

Now, I’d just like to get a gander at the sort of person who gives the Mets $20 million for perks that are basically not much better than being a season ticket holder.

  1. Gardenhire's Cat - Jan 11, 2012 at 9:20 AM

    “Now, I’d just like to get a gander at the sort of person who gives the Mets $20 million for perks that are basically not much better than being a season ticket holder.”

    My thoughts exactly. If I had to guess, I would say these people inherited the money they have, because surely no person smart enough to make $20 million would be dumb enough to just throw it away.

    • dan1111 - Jan 11, 2012 at 9:30 AM

      The perks may not be good, but these investors are not just throwing money away. They also get an ownership stake in the Mets. MLB teams have a history of greatly increasing in value over time. This trend is unlikely to reverse, since baseball teams are an artificially limited commodity with a government-allowed monopoly. Nor is there much risk involved. Even if the Wilpons go down, the Mets will not go down with them.

      • paperlions - Jan 11, 2012 at 9:37 AM

        As far as I can tell, it seems like these deals investments in the Mets and not really anything approaching stakes in ownership, because they don’t get anything a part owner would get in return for their money. It probably won’t turn out to be a bad investment, but it will probably also be a short-term one, as these “shares” likely will be bought out by the new owners.

      • Gardenhire's Cat - Jan 11, 2012 at 9:43 AM

        “Nor is there much risk involved.”

        There’s a very real possibility that the Mets declare bankruptcy. Correct if I am wrong, i honestly dont know, but if this happens these investors will have nothing to show for their $20 millions. Personally, I would consider it quite a risk to invest in the Mets.

      • dan1111 - Jan 11, 2012 at 10:56 AM

        @cat, what these investors are buying is 4% of the team. The Mets are not going to be dissolved. Any bankruptcy would be a restructuring. These investors would still own 4% each at the other end of it.

        This is very different than loaning money to the team, which would be a huge risk right now. And this difference is exactly why Wilpon has to sell part ownership of the team to raise cash, rather than taking out more loans.

      • dan1111 - Jan 11, 2012 at 11:03 AM

        Also, not mentioned in Craig’s previous post on the perks: these part-owners each get a luxury box, which is normally sold for $250,000-$500,000 per year.

      • paperlions - Jan 11, 2012 at 11:41 AM

        Fixed that for ya….” these part-owners each get a luxury box, which have sticker prices from $250,000 to $500,000 per year, but normally are not sold.”

    • brucewaynewins - Jan 11, 2012 at 9:48 AM

      I have to agree.

      Anybody that’d do this has to:

      A. Have enough money that $20 million is chump change

      B. Have not enough to buy a legit share in the team

      C. Be a huge booster

      D. Someone who wants zero responsibility

      E. Someone who loves bad deals.

      I’m thinking someone like Adam Sandler or Kevin James might fit this. They have money but probably not enough to buy the team. They don’t want to own the team and deal with legit frustration of overcoming this mess or have it interfere with their actual careers.

      My other guess is a legally insane multi millionaire with less than $100 million to their name.

  2. churchoftheperpetuallyoutraged - Jan 11, 2012 at 9:59 AM

    So at least $65M of the $100M received so far goes right out the door to cover debts? How has MLB not stepped in a la the Dodgers?

    • dohpey28 - Jan 11, 2012 at 11:03 AM

      It’s paying off team debt, not a 13th house or a hair dresser.

  3. kiwicricket - Jan 11, 2012 at 10:04 AM

    Not sure there is an absolute accurate metric to determine this, but the likelihood of these ‘investors’ being complete wankers is rather high I would imagine.

  4. PanchoHerreraFanClub - Jan 11, 2012 at 10:31 AM

    I have this bridge in Brooklyn and I am looking for few minority investors at $20 million a piece. I’d love to try to market my bridge to these five investors. If they will buy into the Mets, they’ll buy into most anything.

  5. mojosmagic - Jan 11, 2012 at 10:43 AM

    Ego, money, and NY sports equal SUCKERS!!!

  6. stex52 - Jan 11, 2012 at 10:55 AM

    We did this a while back. I go season ticket holder and occasional flights to other cities for big games and 20 MM$ lasts about 500 years. Personally, even being a season ticket holder commits you to sitting in those seats a WHOLE LOT OF TIME. I love baseball, but……..

    As to investment, dicey at best. The Wilpons are one or two lawsuit rulings short of real trouble, and then your 20MM$ is gone.

    More money than sense, in my mind.

    • dan1111 - Jan 11, 2012 at 11:05 AM

      No, you wouldn’t lose your ownership stake if the Wilpons get in trouble.

      • Old Gator - Jan 11, 2012 at 11:53 AM

        Right. You’d keep it and get in trouble with them.

      • dan1111 - Jan 11, 2012 at 12:05 PM

        Huh?

      • stex52 - Jan 11, 2012 at 5:14 PM

        I will defer to your knowledge of how the contract is written. My initial impression was that it was more like a preferred stock ownership with some other benefits than a true ownership stake. If that is not true, than I am wrong.

        Even so, a bankruptcy action could know their value down a lot.

  7. Old Gator - Jan 11, 2012 at 11:46 AM

    I can’t wait for the press conference – the Wilpons and Alderson at the dais, with five bloated investment bankers, seconds sons traduced by primogeniture, and one of those poodles whose dowager mistress left it her fortune hanging upside down behind them with their pockets turned inside out.

  8. cool10857 - Jan 11, 2012 at 7:20 PM

    Hey Fred Wilpon…..you SUCK!

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