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 Chicago fans are hoping that the Ricketts family's race toward home plate in the auction for the Chicago Cubs baseball team will help it break the curse that kept the team from a title for so long, but dealmakers involved in the sale of other Major League franchises are using it as a yardstick.
At a reported $900 million, the Cubs are selling for a premium even in these tough times. Recent sales of baseball teams haven't come near that valuation. The $700 million paid for the Boston Red Sox in 2002 has stood as the high water mark thus far, with sales since well below that:
So what does the Cubs record-breaking deal mean for the other teams still in play? Also for sale is the San Diego Padres, which ended up
on the block when the team's owner John Moores decided to sell his 90%
stake as he goes through a divorce with his wife, Becky. California's
community property law gives her a 50% share of the asset, and she must
agree to any sale. The Goldman, Sachs & Co.-led auction is expected to
close by the first quarter of 2009, the team said in a statement. The favored buyer for the National League West franchise is Jeff Moorad, who resigned as the CEO
of the rival NL West franchise the Arizona Diamondbacks on Jan. 2 after the consortium he leads
entered into exclusive negotiations with Moores. Early reports say that
a deal could close by the end of the first quarter, with various reports
putting the sale price at around $400 million, which is in line with the sale of the Braves and Nationals. Forbes valued the Padres
at $385 million last year, ranking it 19th among the 30 franchises in
Major League Baseball. Also potentially for sale is the New York Times Co.'s 17% stake in the Boston Red Sox. In October, analysts suggested that the troubled media company might sell its share of the American League East franchise, and by December reports surfaced that it was in talks to sell
the Sox and The Boston Globe to advertising executive Jack Connors.
However, Connors shot those down with a brusque statement: "There's nothing to it. I'm not buying The
Boston Globe. I'm not buying anything that The New York Times owns.'' Henry Blodget, former Wall Street analyst and current blogger, was one
of the earliest proponents of selling the Sox, dating back to October
posts on his Silicon Alley Insider blog. But there are some skeptics
who also point out that now is not the time to put a sports franchise
on the auction block. Lending is tight, and bids may be lower than
expected because of the limited money supply. But if the Cubs do net $900 million, then the common wisdom may be wrong. Like the Cubs, the Sox are a well established franchise with a long history in a big media market. So based on Forbes 2008 estimate that the Sox are worth $816 million, the Times could make an easy $150 million for its stake in the franchise alone -- most likely, however, any deal would include the company's stake in the team's cable network NESN. The Times has since had to take a $250 million loan
from Mexican billionaire Carlos Slim in order to refinance its existing
debt, and it is near a lease-back deal with W.P. Carey & Co. LLC for its new headquarters. So with the newspaper industry under more pressure than ever before, it might not be long until the Gray Lady also sells the Sox, meaning the possible Cubs sale is good news for the Times' Sulzberger family. - George White See Dealwatch on baseball teams for sale See Dealscape post on the future of newspapers See Dealscape post on Cubs sale See Deal weekly post on Carlos Slim/NY Times See Dealscape post on Conners/NY Times See Dealscape post on NY Times Red Sox stake Categories Deal Video
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