Madoff's Curveball" by Jeffrey Toobin & other Wilpon stories

[metirish]

Richard Sandomir ? @RichSandomir Close
Judge will rule on Summary judments in Mets/Madoff case by March 5--but he did toss experts testimony including John Maine's

[Edgy MD]

Wilpon currently giving what Ruby Tuesday is calling a "massive" interview. He's acknowledged that, while he has seven shares of the team sold and in escrow, four are sales to SNY.

[Edgy MD]

Three more shares reportedly awaiting MLB approval.

[Edgy MD]

[list:1pnclrgk][*:1pnclrgk]Sandy's call on locking up David Wright.

[/*:m:1pnclrgk]
[*:1pnclrgk]All-Star game to be announced soon. Financial details are being hammered out with NYC.

[/*:m:1pnclrgk]
[*:1pnclrgk]Total shares sold expected to be 12: four SNY, two to "family," and six to others.[/*:m:1pnclrgk][/list:u:1pnclrgk]

[Edgy MD]

[list:rkxa9yxc][*:rkxa9yxc]"...we intend to own the franchise for a very long time"[/*:m:rkxa9yxc][/list:u:rkxa9yxc]

[Benjamin Grimm]

• "...we intend to own the franchise for a very long time"

[Ceetar]

sure he'll get flak for the jokes. Of course, he'll get criticized for whatever he says or doesn't say at this point so he might as well say what he wants.

Glad he clarified the All-Star Game thing. NYC Red Tape, gee, who would've guessed that that slows things down? Of course, this means that this information was readily available to all the beat writers who chose instead to say "It's basically official" and spend their time breaking down who arrived to Spring Training when.

[TransMonk]

I hat the Wilpons.

[Edgy MD]

[list:20ci9s3g][*:20ci9s3g]...trying to build a young core, THEN spending for big free agents to compliment them. (Burkhardt's inference)

[/*:m:20ci9s3g]
[*:20ci9s3g]Court proceedings are not tied to David Wright's future.

[/*:m:20ci9s3g]
[*:20ci9s3g]"Listen, we certainly act in certain broad parameters. But the parameters always change." (Gonna have to check the transcript for the context on that.)[/*:m:20ci9s3g][/list:u:20ci9s3g]

http://www.metsblog.com/2012/02/27/recap-fred-wilpon-on-minority-shares-financials-wright-13-asg/

[HahnSolo]

While addressing the media, Mets owner Fred Wilpon said �as long as I can, I plan to be the owner here.�

From Metsblog. Context would be important here, but it doesn't read like Fred is all that confident in what he is saying.

[MFS62]

HahnSolo wrote: From Metsblog. Context would be important here, but it doesn't read like Fred is all that confident in what he is saying.

Just like the fans.

Later

[Edgy MD]

I'm pretty confident that he'll end up continuing to control the team for the foreseeable future.

[Edgy MD]

Transcript.

[metirish]

Ha!

Q: What's the status of your financials? FW: (Takes out of a wad of bills from his front pocket)

[metirish]

Makes for interesting reading.

[Gwreck]

I found this bit remarkably self-aware, and yet still maddeningly frustrating as he fails to acknowledge they are charging NY prices for a Pittsburgh-quality team:

But we have a diminished population coming to Citi Field. We need that revenue. We just can't do it on air. We need that revenue to support. And the only way we're going to get that revenue is if we have a competitive, interesting team on the field. Otherwise, they're not going to come just because they love Citi Field.

[Ceetar]

Gwreck wrote: I found this bit remarkably self-aware, and yet still maddeningly frustrating as he fails to acknowledge they are charging NY prices for a Pittsburgh-quality team: But we have a diminished population coming to Citi Field. We need that revenue. We just can't do it on air. We need that revenue to support. And the only way we're going to get that revenue is if we have a competitive, interesting team on the field. Otherwise, they're not going to come just because they love Citi Field.

They've lowered prices at Citi Field every year. And volume of affordable tickets much less than just about every other NY franchise (in all sports)

Dynamic pricing is looking interesting. Looks like they'll be able to better capitalize financially on hype (OD already up about $10). Jury still out on if the corresponding price drop for midweek and crappy games compensates.

[Guest LeiterWagnerFasterStrongr]

Wait a minute... FOUR to SNY?

Is that legal? He's essentially using one of his businesses to recapitalize another one of them. It's like B-to-B embezzling, no? (And consequently, he's transferring a huge hunk of debt/risk to his only healthy enterprise... which, y'know, should be great for any potential sale value.)

[batmagadanleadoff]

Wait a minute... FOUR to SNY?

Nothing new there.
_______________________


The Mets owners keep peddling a story about new investors, but who's buying?
By Howard Megdal

9:23 am Feb. 23, 2012

Here we go again. Newsday reported on Wednesday evening that Fred Wilpon and his partners, who own the New York Mets, had reached an agreement to sell seven minority shares in the club. Only one buyer, Steven A. Cohen, manager of the hedge fund SAC Partners, was identified. But the news, presented by the embattled Mets ownership group as progress, is anything but. If the Mets have only seven minority share commitments, that means they are still three short of the ten they need simply to pay some fast-approaching debts, with their latest deadline, the end of the month, just a few days away. Let's review. For the better part of a year now, the Mets have reportedly been close to a $200 million infusion of capital through the sale of minority shares, first in the person of hedge-funder David Einhorn, then through sales of ten smaller, $20 million blocks. Thanks to the reporting of the Times' Rich Sandomir, we know that two of those blocks are to be purchased by... Fred Wilpon and his partner, Saul Katz. The reason they'd do this, rather than simply invest that money into the team directly, is precisely the same reason the Mets aren't closing on the minority sales individually, but only once they line up ten such investors: the move wouldn't be likely to earn approval from the team's current debtholders. Keep in mind that the minority shares are, in reality, additional debt against the team. Minority owners would earn three percent interest on their shares per year, for six years, and then would have the right to sell those shares back to the Wilpon group and collect their interest. As a result, the current owner of the debt against the New York Mets, JPMorgan Chase, wants a substantial payment from that $200 million investment in exchange for approving the deal. During the Einhorn negotiations, JPMorgan Chase was set to receive half of that money, and held up the deal until they were satisfied in this regard. Sandomir also reported that SNY, the Mets-partnered cable network, would be purchasing four shares, for a total of $80 million. SNY, which is 65-percent owned by Wilpon and his partners, has plenty of motivation to try to bail them out as owners of the Mets. Their minority partner at SNY, Comcast/Time Warner, knows that SNY becomes far less valuable if decoupled from the Mets in terms of ownership. The network earns its profits almost entirely through showing Mets games, and pays a far lower rate for those rights than a new owner would likely demand. So that's six shares. The seventh is from Cohen, who is in the bidding to purchase the Dodgers, and would need to sell whatever Mets share he owns if he manages to buy the Dodgers outright. His purchase amounts to little more than a gesture of goodwill toward Bud Selig and Major League Baseball. In other words, despite months of aggressively seeking buyers, the Mets appear to have found exactly no one, other than people who are already owners, who is willing to risk $20 million in what amounts to a low-return CD from a company with a high chance of bankruptcy. After all, a minority owner can't expect a clear shot at earning back $20 million plus three percent annually in six years if the $430 million debt against the Mets due in 2014, the $450 million debt against SNY due back in 2015, the roughly $600 million remaining in debt payments on Citi Field due twice annually for the forseeable future, or the $386 million lawsuit brought against the owners by trustee for the Bernie Madoff victims, Irving Picard, gets the Wilpons first. Meanwhile, the Mets owners have more immediate hurdles to clear. Wilpon and his partners took out a $40 million bridge loan at the end of November simply to pay one of their Citi Field debt payments on December 15; that bridge loan is due back in March. They still owe $25 million to M.L.B., long past due�the minority sales are supposed to pay that debt, too. And Thursday, Federal District Court Judge Jed S. Rakoff will hear arguments about whether he should rule in favor of summary judgment for Picard's seeking of $83 million in fictitious profits Madoff paid the Wilpon group over the final two years of Madoff's scheme. Rakoff has previously indicated that he may well rule in Picard's favor on this. If he does, Wilpon and his partners need to either come up with the $83 million, or post a bond worth 110 percent of the judgment�around $91 million�just to appeal. The math isn't that hard: $83 million judgment plus $40 million in bridge loan repayment plus $25 million to M.L.B. plus $100 million to JP Morgan Chase is a far greater sum than the $200 million they'd raise with ten minority owners. But facing such a problem will require something else first, something that, more than a year after the process started, the Wilpon group doesn't yet appear to have: a single soul willing to put up real money on the premise that Mets ownership will be good for it. Here's what the Mets had to say about it, in a statement: "As has been our practice, we will not comment on any aspect of the limited partnership sale process."

http://www.capitalnewyork.com/article/null/2012/02/5333055/mets-owners-keep-peddling-story-about-new-investors-whos-buying

[Edgy MD]

LeiterWagnerFasterStrongr wrote: Is that legal?

I don't know why it wouldn't be. I imagine it happens all the time.

[TransMonk]

I believe SNY also has some hefty interest payments of it's own, but it is one of the few Wilpon outlets that still turns a profit...so who knows.

Wilpon's only hope is that this team is better than people think...and that it translates into sucess both on the field and at the box office. He's hedging a lot of bets and hoping for some magic to happen...which is really his only choice right now. He's not giving up his team unless someone pries it out of his cold, dead (broke) hands.

[Gwreck]

Ceetar wrote: They've lowered prices at Citi Field every year. And volume of affordable tickets much less than just about every other NY franchise (in all sports) Dynamic pricing is looking interesting. Looks like they'll be able to better capitalize financially on hype (OD already up about $10). Jury still out on if the corresponding price drop for midweek and crappy games compensates.

That they have lowered prices each year doesn't mean the tickets are now priced correctly.

Dynamic pricing would be interesting if it was true dynamic pricing, but it isn't, as there is an artificial price floor. There will be no market-value price drop for midweek/early season games because the Mets committed to not dropping the price below the season ticketholder price. Similarly, Stubhub sales also have an artificial price floor because of the minimum $5/ticket service charge and $5 delivery fee.

All the dynamic pricing does is allow the Mets to make more money on in-demand games. This is not a consumer-friendly measure.

[ashie62]

• Sandy's call on locking up David Wright.
  
  
• All-Star game to be announced soon. Financial details are being hammered out with NYC.
  
  
• Total shares sold expected to be 12: four SNY, two to "family," and six to others.

Edgy DC wrote:

NYC is concerned about the citys cost of hosting the ASG. They paid for a Giants parade for crying out loud.

Fred tries to come off that Sandy is under more freedom to put a team together than the financials might suggest. I do not believe him.

[Ceetar]

Gwreck wrote: Ceetar wrote: They've lowered prices at Citi Field every year. And volume of affordable tickets much less than just about every other NY franchise (in all sports) Dynamic pricing is looking interesting. Looks like they'll be able to better capitalize financially on hype (OD already up about $10). Jury still out on if the corresponding price drop for midweek and crappy games compensates. That they have lowered prices each year doesn't mean the tickets are now priced correctly. Dynamic pricing would be interesting if it was true dynamic pricing, but it isn't, as there is an artificial price floor. There will be no market-value price drop for midweek/early season games because the Mets committed to not dropping the price below the season ticketholder price. Similarly, Stubhub sales also have an artificial price floor because of the minimum $5/ticket service charge and $5 delivery fee. All the dynamic pricing does is allow the Mets to make more money on in-demand games. This is not a consumer-friendly measure.

I'm not sure anyone knows what 'priced correctly' is. Yes, $53 after fees for Promenade Infield is a bit steep. They gouge you on platinum games and dynamic pricing will kill you on games you really like if you're not proactive. It is a business after all.

On the other hand I can get in to most weekday game for less than it costs me to get there, or about as much as a regularly priced movie ticket.($13. Never mind IMAX or 3D) Two beers at many bars in the city(often $5-6, not including tip). Even for the top non-platinum tier, the ticket to get in is only $3 more than the Met, which is $25. The Intrepid Museum is $22 (the price of many weekend games).

And to me the experience at Citi Field is worth so much more than what I get at those other entertainment options. And those are the cheap options. How about the Circus? Broadway? These are the entertainment options the Mets are competing with.

[ashie62]

The price of the tickets are reaonable. Its all the other crap that runs my bill up.

If I lived in the neighborhood I'd probably go to most games.

Beats cable and the interweb anyday.

[Ceetar]

Ashie62 wrote: The price of the tickets are reaonable. Its all the other crap that runs my bill up. If I lived in the neighborhood I'd probably go to most games. Beats cable and the interweb anyday.

Port Authority bridge toll increases hit me hardest. It's virtually the only downside to having moved from LI to NJ.

[metirish]

Kids free in September was a great promotion last season.....will that happen again?

When going to games I rarely factor in the Whitstone bridge and parking in to the equation......went to MFY stadium a few years ago and parking was $35 .....a good walk from the stadium too.

[Ceetar]

metirish wrote: Kids free in September was a great promotion last season.....will that happen again?

I hope not. (In that they don't have the tickets available to do so)

I suspect we'll get all sorts of those promotions though, and good or bad there will be tickets available. Talked with the person in charge of those things in December and she seemed pretty serious about it. Also said the BJs Clubhouse didn't do so well and seemed to take offense when I told her Left Field Landing is the worst section in the park.

[Edgy MD]

When did we get from being disgusted by the Mets' management and refusing to go as a principled statement to the games being too gosh-darned expensive to go to... when we want to... which we don't?

[Ceetar]

Edgy DC wrote: When did we get from being disgusted by the Mets' management and refusing to go as a principled statement to the games being too gosh-darned expensive to go to... when we want to... which we don't?

When Wilpon mentioned attendance/revenue and how they need it.

I'm not sure when anyone was making a principled statement about refusing to go. That's a personal decision that I want no part of.

edit: feel free to split off the ticket discussion if you like. I find that stuff kind of interesting, tracking the dynamic pricing and the promotions and whatnot.