No Longer Saul in the Family

[G-Fafif]

Big-balled Saul Katz has had it with the Mets, reports the Times.

Wilpon�s Partner Has Expressed Interest in Selling His Share of Mets

By Michael S. Schmidt

Saul B. Katz, who owns a majority share of the Mets in a partnership with his brother-in-law and business partner, Fred Wilpon, has expressed a desire to sell his portion of the team because he has grown tired of spending millions to prop it up, according to several people in baseball briefed on the matter. But Katz has been hesitant to sell because it could result in Wilpon�s no longer maintaining majority control, according to the people familiar with Katz�s situation. This has created a situation in which Katz has been locked into subsidizing part of the team�s losses in an effort to protect Wilpon, who considers the team a family heirloom and wants his son Jeff to control it for years to come. Keeping Score: Subway Series Offers Hope for Hitless Mets PitchersMAY 11, 2014 The people in baseball who described the situation spoke on condition of anonymity because they were not authorized by Katz to speak publicly about his finances and feared possible retribution from the baseball commissioner�s office, which discourages officials from discussing internal matters. The Mets declined to make Katz available for an interview. David Newman, a spokesman for the Mets, said Monday that there was �no truth� to the notion that Katz wants to sell his portion of the team. Katz, Newman said, is �definitely not selling.� Katz and Wilpon are business partners through Sterling Equities, their umbrella company, and they are believed to own roughly two-thirds of the Mets. If Katz were to sell his share of the team to someone other than Wilpon, it would create questions as to whether Wilpon, who currently serves as the team�s chairman of the board and chief executive, could maintain his role as the club�s ultimate decision maker. Katz has long overseen the Mets� finances, dating to the days when he used Bernard L. Madoff�s hedge fund, which was later exposed as a Ponzi scheme, to fund the team�s operating expenses. People who know Katz, 75, and Wilpon, 77, have said that Katz has less interest in baseball than Wilpon, who grew up playing the sport � he was Sandy Koufax�s high school teammate � and serves on Commissioner Bud Selig�s executive council. Katz, meanwhile, has long been involved with philanthropic efforts in the field of medicine � a wing of North Shore University Hospital in Manhasset, N.Y., is named after him � and he also directs Sterling�s real estate operations. But he has remained in the background when it comes to the day-to-day fortunes of the club, which has not had a winning season since 2008. It is unclear whether Katz has attempted to search for potential buyers. Several bankers involved with deals involving sports organizations said they had not been asked to help appraise Katz�s stake in the team, the first step toward brokering a sale. Finding a buyer willing to spend hundreds of millions of dollars for a share in the team but not have a major voice in running it is likely to be difficult. In 2011, the Mets tried to sell a $200 million stake in the team, but their deal with David Einhorn, the hedge fund titan, fell apart in part because he wanted a greater hand in the team�s decision-making than is normally given to minority stakeholders as well as a pathway to eventual majority control. As a result, the Mets were forced to sell many smaller stakes, including several to their cable television partners. Wilpon and Katz also sold three shares to themselves. There are no public profit-and-loss statements or other documents that definitively show the complete state of the club�s finances or how its ownership is structured. But reports linked to the bonds issued to finance Citi Field provide a partial snapshot of the team�s financial performance. Those documents show that revenue from the stadium�s 10,635 most expensive seats has fallen 58 percent, to $41.8 million from $99.3 million in 2009. In that period, concession sales have decreased 29 percent and parking revenue has dropped 20 percent. The team reportedly lost $70 million in 2011. Meanwhile, attendance at Citi Field has fallen by 32.5 percent since the stadium opened in 2009. Katz�s apparent desire to sell suggests that the Mets� losses have tested his patience. Their financial woes, which started around the time that Madoff�s fraud was exposed, in 2008, have had an impact on the team and its owners and limited how much has been spent in recent years on the club�s payroll. That, in turn, has frustrated many Mets fans, who reason that if more money were being spent on free agents the club, in turn, would be more competitive than it has been. Wilpon and his son Jeff have maintained that the team�s finances have improved more recently, but several people in baseball briefed on that issue said the situation remained troublesome. And the payroll essentially remains where it was in 2013, somewhere from $85 million to $90 million, leaving it in the lower third in the major leagues despite the fact that the Mets are a big-market team. With attendance figures that have declined markedly in recent seasons (there has been a slight uptick in 2014) and with significant debt payments still due on Citi Field, the Mets are likely to lose money again this season, the people said. That makes it unlikely that the payroll will jump substantially any time soon. The team�s poor performance financially has also agitated other major league owners, who are dismayed that a club playing in as large a market as the Mets do is unable to generate more revenue. It was in 1980 when Wilpon first bought a stake in the Mets, a simple 1 percent share. He and Katz became half owners of the team in 1986, with Nelson Doubleday, then bought out Doubleday�s share in 2002. Details about Katz�s close relationship with Madoff were revealed as part of a lawsuit filed against them in 2011 by the court-appointed trustee recouping money from Madoff�s victims. The trustee, Irving H. Picard, said that Katz routinely used money from Madoff�s fund to finance businesses and deepen his and Wilpon�s personal wealth. The owners won their legal battle with Picard when he ultimately abandoned hundreds of millions of dollars in claims against them. But Katz and Wilpon had to agree to let Picard use the $178 million they lost in some of their Madoff accounts to pay back the trustee for the $162 million in fictitious profits that they received in other accounts.

Edited May 12, 2014 by Guest

[Gwreck]

http://www.nytimes.com/2014/05/13/sports/baseball/wilpons-partner-has-expressed-interest-in-selling-his-share-of-mets.html

Wilpon�s Partner Has Expressed Interest in Selling His Share of Mets

By MICHAEL S. SCHMIDT

MAY 12, 2014


Saul B. Katz, who owns a majority share of the Mets in a partnership with his brother-in-law and business partner, Fred Wilpon, has expressed a desire to sell his portion of the team because he has grown tired of spending millions to prop it up, according to several people in baseball briefed on the matter.

But Katz has been hesitant to sell because it could result in Wilpon�s no longer maintaining majority control, according to the people familiar with Katz�s situation. This has created a situation in which Katz has been locked into subsidizing part of the team�s losses in an effort to protect Wilpon, who considers the team a family heirloom and wants his son Jeff to control it for years to come.

The people in baseball who described the situation spoke on condition of anonymity because they were not authorized by Katz to speak publicly about his finances and feared possible retribution from the baseball commissioner�s office, which discourages officials from discussing internal matters.

The Mets declined to make Katz available for an interview. David Newman, a spokesman for the Mets, said Monday that there was �no truth� to the notion that Katz wants to sell his portion of the team. Katz, Newman said, is �definitely not selling.�

Katz and Wilpon are business partners through Sterling Equities, their umbrella company, and they are believed to own roughly two-thirds of the Mets. If Katz were to sell his share of the team to someone other than Wilpon, it would create questions as to whether Wilpon, who currently serves as the team�s chairman of the board and chief executive, could maintain his role as the club�s ultimate decision maker.

Katz has long overseen the Mets� finances, dating to the days when he used Bernard L. Madoff�s hedge fund, which was later exposed as a Ponzi scheme, to fund the team�s operating expenses.

People who know Katz, 75, and Wilpon, 77, have said that Katz has less interest in baseball than Wilpon, who grew up playing the sport � he was Sandy Koufax�s high school teammate � and serves on Commissioner Bud Selig�s executive council.

Katz, meanwhile, has long been involved with philanthropic efforts in the field of medicine � a wing of North Shore University Hospital in Manhasset, N.Y., is named after him � and he also directs Sterling�s real estate operations. But he has remained in the background when it comes to the day-to-day fortunes of the club, which has not had a winning season since 2008.

It is unclear whether Katz has attempted to search for potential buyers. Several bankers involved with deals involving sports organizations said they had not been asked to help appraise Katz�s stake in the team, the first step toward brokering a sale.

Finding a buyer willing to spend hundreds of millions of dollars for a share in the team but not have a major voice in running it is likely to be difficult. In 2011, the Mets tried to sell a $200 million stake in the team, but their deal with David Einhorn, the hedge fund titan, fell apart in part because he wanted a greater hand in the team�s decision-making than is normally given to minority stakeholders as well as a pathway to eventual majority control.

As a result, the Mets were forced to sell many smaller stakes, including several to their cable television partners. Wilpon and Katz also sold three shares to themselves.

There are no public profit-and-loss statements or other documents that definitively show the complete state of the club�s finances or how its ownership is structured. But reports linked to the bonds issued to finance Citi Field provide a partial snapshot of the team�s financial performance. Those documents show that revenue from the stadium�s 10,635 most expensive seats has fallen 58 percent, to $41.8 million from $99.3 million in 2009. In that period, concession sales have decreased 29 percent and parking revenue has dropped 20 percent. The team reportedly lost $70 million in 2011. Meanwhile, attendance at Citi Field has fallen by 32.5 percent since the stadium opened in 2009.

Katz�s apparent desire to sell suggests that the Mets� losses have tested his patience. Their financial woes, which started around the time that Madoff�s fraud was exposed, in 2008, have had an impact on the team and its owners and limited how much has been spent in recent years on the club�s payroll.

That, in turn, has frustrated many Mets fans, who reason that if more money were being spent on free agents the club, in turn, would be more competitive than it has been.

Wilpon and his son Jeff have maintained that the team�s finances have improved more recently, but several people in baseball briefed on that issue said the situation remained troublesome. And the payroll essentially remains where it was in 2013, somewhere from $85 million to $90 million, leaving it in the lower third in the major leagues despite the fact that the Mets are a big-market team.

With attendance figures that have declined markedly in recent seasons (there has been a slight uptick in 2014) and with significant debt payments still due on Citi Field, the Mets are likely to lose money again this season, the people said. That makes it unlikely that the payroll will jump substantially any time soon.

The team�s poor performance financially has also agitated other major league owners, who are dismayed that a club playing in as large a market as the Mets do is unable to generate more revenue.

It was in 1980 when Wilpon first bought a stake in the Mets, a simple 1 percent share. He and Katz became half owners of the team in 1986, with Nelson Doubleday, then bought out Doubleday�s share in 2002.

Details about Katz�s close relationship with Madoff were revealed as part of a lawsuit filed against them in 2011 by the court-appointed trustee recouping money from Madoff�s victims. The trustee, Irving H. Picard, said that Katz routinely used money from Madoff�s fund to finance businesses and deepen his and Wilpon�s personal wealth.

The owners won their legal battle with Picard when he ultimately abandoned hundreds of millions of dollars in claims against them. But Katz and Wilpon had to agree to let Picard use the $178 million they lost in some of their Madoff accounts to pay back the trustee for the $162 million in fictitious profits that they received in other accounts.

[Zvon]

G-wreck must be faster to beat G-Fafif to the punch.

[Gwreck]

(Duplicate, can be merged with the other thread)

[Guest John Cougar Lunchbucket]

wowwowowow

[Edgy MD]

I know, right? Mike Schmidt, working for the Times!

[Gwreck]

Couple of takeaways:

1. No other reaction but to laugh when someone from the Mets goes on the record that they are "definitely not selling." Yes, it's David Newman this time (Dave Howard having since departed) but they don't have a long history of credibility on this issue.

2. As always, anything leading to a sale of the Mets to new ownership has to be seen as a positive sign.

[batmagadanleadoff]

G-Fafif wrote: Big-balled Saul Katz has had it the Mets, reports the Times. Wilpon�s Partner Has Expressed Interest in Selling His Share of Mets By Michael S. Schmidt Katz�s apparent desire to sell suggests that the Mets� losses have tested his patience. Their financial woes, which started around the time that Madoff�s fraud was exposed, in 2008, have had an impact on the team and its owners and limited how much has been spent in recent years on the club�s payroll. *** Wilpon and his son Jeff have maintained that the team�s finances have improved more recently, but several people in baseball briefed on that issue said the situation remained troublesome. And the payroll essentially remains where it was in 2013, somewhere from $85 million to $90 million, leaving it in the lower third in the major leagues despite the fact that the Mets are a big-market team.

Wow. A chink in the armor. An opening! If there's any truth to this piece, it tells me to expect more of the same Mets financial misery for years to come. Why would Katz want out if Mets prosperity truly was around the corner? Expect some word-lengthy Megdal pieces real soon.

[seawolf17]

Let's do this. I've got $38 in my wallet.

[Edgy MD]

Expect some word-lengthy Megdal pieces real soon.

Thank you, but... really, I'm full.

[G-Fafif]

If Jeff Wilpon doesn't get to go around being Jeff Wilpon, New York Mets COO, what is Jeff Wilpon to do?

Other than being generally well off and allowed to build stuff?

Edited May 12, 2014 by Guest

[metirish]

who considers the team a family heirloom and wants his son Jeff to control it for years to come.

this is what I dislike a bout them really, the idea that the Mets are a family heirloom

[Guest LeiterWagnerFasterStrongr]

G-Fafif wrote: If Jeff Wilpon doesn't get to go around being Jeff Wilpon, New York Mets COO, what is Jeff Wilpon to do? Other than being generally well of and allowed to build stuff?

Operate and serve as featured attraction for gun shows? Freelance jar-opener? Forearm model for new Popeye animated series? Point is, he's got options.

[Guest d'Kong76]

Love the thread title!

[Guest d'Kong76]

NYTimes wrote: The people in baseball who described the situation spoke on condition of anonymity because they were not authorized by Katz to speak publicly about his finances and feared possible retribution from the baseball commissioner�s office, which discourages officials from discussing internal matters.

But, ya know, they couldn't keep their flaps shut because
it's Subway Series time and leaking it has more sizzle now.

[Guest Mets � Willets Point]

seawolf17 wrote: Let's do this. I've got $38 in my wallet.

I can chip in a fiver.

[Guest Mets � Willets Point]

d'Kong76 wrote: Love the thread title!

Indubitably!

[Zvon]

metirish wrote: who considers the team a family heirloom and wants his son Jeff to control it for years to come. this is what I dislike a bout them really, the idea that the Mets are a family heirloom

This ticked me a bit too. And I'm not sure why. Because if I owned the team, I'd want to think that way. But more out of passion than as a property. And who's to say what their thinking is? Still, you can think that way regardless of the motivation, but it's a gaudy thing to say.

[Frayed Knot]

Do keep in mind that the "considers the team to be a family heirloom" line from the above article is that of the writer and not a direct Wilpon-ian quote.

[Mex17]

Frayed Knot wrote: Do keep in mind that the "considers the team to be a family heirloom" line from the above article is that of the writer and not a direct Wilpon-ian quote.

It's been common knowledge for some time.

[batmagadanleadoff]

Fred Wilpon had a good run. 35 years ago, Fred was very wealthy, but not own-a-baseball-team Master of the Universe wealthy. He could barely afford a one digit percent share of the team. But through legal maneuvering, a lotta luck (you always need that, probably more than anything else in life) and probably a lot of chicanery involving Madoff inflated balance sheets, he parlayed his tiny stake in the team into a majority ownership share.

[Zvon]

Mex17 wrote: Frayed Knot wrote: Do keep in mind that the "considers the team to be a family heirloom" line from the above article is that of the writer and not a direct Wilpon-ian quote. It's been common knowledge for some time.

To me though, if they didn't actually say it, then it changes my thinking. Entirely. If this was projected on to them, even if through common sense, it's different.

[Frayed Knot]

Mex17 wrote: Frayed Knot wrote: Do keep in mind that the "considers the team to be a family heirloom" line from the above article is that of the writer and not a direct Wilpon-ian quote. It's been common knowledge for some time.

OF COURSE the Wilpons want to keep control! Do you know anyone who buys something and declares that he hopes to lose it in a hostile takeover or by being unable to make the bills?
But declaring the family heirloom line to be distasteful because it's "a gaudy thing to say" isn't accurate because that line wasn't Fred's it was the writer's.

[Edgy MD]

Of course.

[MFS62]

Mets � Willets Point wrote: seawolf17 wrote: Let's do this. I've got $38 in my wallet. I can chip in a fiver.

My dream is to hit one of the really large lottery payoffs, knock on Jerry Seinfeld's door, and ask him if he wants to go halfies with me on the Mets.
We'll figure out how we can offer you folks a minority share.

Later

[Benjamin Grimm]

Saul is categorically denying that he has any intention of selling his part of the team.

[Guest d'Kong76]

Pavlov's dog doesn't miss a cue ...
http://www.capitalnewyork.com/article/media/2014/05/8545234/wilpon-family-wobbling

[Gwreck]

Recognizing that around here there's little interest in reading Megdal, but I thought he had a every effective rebuttal piece to Rubin's blame-assignment-to-Alderson:

http://www.capitalnewyork.com/article/media/2014/05/8545203/reminder-mets-problems-come-very-top

[Edgy MD]

I'm thinking that the team is 18-19, with help hopefully on the way, the concern shouldn't be about assigning blame at all, but about root-root-rooting for the home team.

[Gwreck]

Edgy MD wrote: I'm thinking that the team is 18-19, with help hopefully on the way, the concern shouldn't be about assigning blame at all, but about root-root-rooting for the home team.

They aren't mutually exclusive.