As the Sterling Boys continue to consider the available options to extricate themselves from the Madoff mess……that screaming $1.0 billion dollar lawsuit slapped on them by Madoff Trustee Irving Picard for essentially looking the other way at the steady 16%-18% annual returns his ponzi scheme threw off….several options have been discussed, most centered around selling parts of the enterprise.
Clearly, the plans have been fluid.
In December, after the lawsuit was filed, we heard Daddy’s Boy, Mets COO Jeffie Wilpon, tell us that “no part of the team is for sale. Period. We have many options available, like tapping the banking system for money, etc.”
One week later the real COO of the club, Daddy Fred, gave young Jeffie a public slap by calling a news conference to announce their credit line was essentially tapped out, at both the banks and MLB, and they would sell up to 25% of the club, maintaining all control. No other part of the enterprise, meaning cash positive regional sports channel SNY among others, would be included in the deal.
Two weeks later, we heard “OK, we might sell up to 49% of the club while maintaining total control of the club. Oh, and maybe we will include a portion of SNY in the sale.”
So the revenue raise has been somewhat of a moving target, which is natural I guess as discussions with potential buyers begin. WFAN show host Mike Francesa, who seems as wired as anyone on this freak show, reported that as many as 30 different groups had contacted Allen & Co’s Steve Greenberg to express interest in the deal. Francesa further stated that the Mets hoped to conclude the sale by June or July and interpreted that they had enough cash on hand to run the club up until that point.
In today’s New York Post, columnist Joel Sherman, proposes a silver lining to this black cloud and it was something I had not considered. Essentially, Sherman suggests that the Mets do a complete salary/player dump and enter 2012 with a greatly reduced payroll (complete story linked below) and rebuilding type team.
I know that Mets GM Sandy Alderson is up to the task and I say let him at it.
Sherman reminds us that this season, the Mets payroll is in the $140 million range with expiring contracts ahead for starters Carlos Beltran ($19.4) and Jose Reyes ($9.375) as well as those two constant thorns in Mets fans sides, Oliver Perez ($12.0) and Luis Castillo ($6.25). The club also has an option on K-Rod that would cost them $3.5 million but with a salary this year of $11.5 million, that means a net savings of $8.0 million. Add the 5 salaries together and you come to a total of $55.0 million dollars….not too shabby.
You can’t see the team just releasing these players out right. Beltran, Reyes and K-Rod all have value in trades and GM Alderson would have little trouble making deals that returns young and inexpensive talent. Executing that strategy essentially relegates the Mets to second or even third tier status in their own division, considering the strength of the Phillies, re-emergence of the Braves and budding youth and optimism among Nationals fans.
That’s where Sherman pushes on, essentially saying, “why stop there”? His idea is to also move Jason Bay and his $8.6 million, Johan Santana ($20.4) and even David Wright ($10.25), turning up another $39.3 million.
Combined with the prior Gang of 5, this roster action creates a savings of $94.3 million! ith contracts to the new players acquired through trades and the remaining Mets, Sherman is estimating a payroll of around $70 million for 2012.
Sherman spoke with 2 different GMs who estimated that the Mets could sell about 2 million tickets with a rebuilding roster…and that combined with salary savings, could allow the club to actually earn a profit. I don’t have enough insight to agree or disagree with any certainty, but that ticket sales figure seems high to me considering the cost of seats at CitiField. And this strategy doesn’t really solve the need to raise instant cash to handle the Madoff mess.
But Sherman suggests that the club could potentially calm their bankers nerves and might even open the spigot again for additional loans should the hoped for profits materialize.
Sherman argues that the strategy is the only course of action. Several “baseball people” suggest that smart fans will get it. The Mets today, as built, are not capable of winning a championship, even if the moon and stars align. They need a re-haul and why not start today, in full?
Sherman believes that the Wilpons have been deluding themselves for years that they are “one player away” from a title and have never shown the “discipline or intellect” to stick with a rebuilding plan in the past. And that’s where Alderson’s experience and credibility comes in….convincing the Wilpons that this is the ONLY course of action.
I think he is already examining this entire strategy….remember, Alderson hired two expensive old hands as Assistant GMs…Paul DePodesta who worked with Alderson in Oakland and went on to lead the Dodgers (only to get fired immediately by the train wreck Frank McCourt) and JP Riccardi, who led the Blue Jays for years and was with Boston for one season. One task for each is to scan the market for younger players with potential and I think they are both accomplished stars at that task. So does Alderson.
I think Sherman is on to something. You?
- Wilpons may need all-out (nypost.com)
- Decision to Sell Piece of Mets but Not SNY Surprises Analysts (nytimes.com)
- Jeff Wilpon: We’ll stay in power (nypost.com)
THE LAST BITE
I am looking forward to the Big East tournament that begins this week… Come on Lavin, get those Johnnies rollin! Can you imagine the hype of St. John’s v. Seton Hall?