Atlanta Braves Might Soon Have a Rival with a New Owner

We have often laughed at the plight of the Miami Marlins, because so many of their failures have been self-inflicted. But there’s a chance that the leading cause of their ills might be going away.

According to a report from Forbes.com, the Miami Marlins could have a “handshake agreement” with a buyer for the club. If so, Forbes might need to re-evaluate how they assign values to major league clubs.

Rival to the Atlanta Braves in the NL East, the Miami Marlins’ franchise was valued at 29th in baseball just 11 months ago – at just $675 million. This is a team plagued by a terrible stadium deal – albeit for the local government to clean up – terrible attendance, and a revenue stream in positive territory only thanks to MLB revenue sharing.

In December, we got a chuckle out of this report from Forbes when it was learned that owner Jeffrey Loria was looking for a price of $1.7 billion for the team, and that it was indeed being offered for sale.

Time to Stop Laughing?

In today’s report, Mike Ozanian writes that Loria had already received an offer of $1.4 billion from Solamere Capital (a Boston private equity firm) back in November.

However today, he writes this:

"Two sources who spoke on the condition of anonymity said that Miami Marlins president David Samson has said that there is a $1.6 billion “handshake agreement” for the MLB team. Jeffrey Loria paid $158 million for the baseball team in 2002."

He goes on to say that the unnamed buyer is a real estate developer from New York City. The complication is that this buyer’s wealth is tied up in his real estate investments and he may not be able to raise enough cash to assuage MLB’s concerns about debt.

The purchase would then hinge on leveraging those real assets as collateral for a debt purchase. Ozanian points out that the Dodgers were purchased in 2012 with a similar debt approach, but they also had other advantages, not the least of which turned out to be a new TV deal that easily covers their $2 billion investment.

The Marlins’ TV contract goes through 2020… but that’s 4 years until a new deal kicks in, and face it, the market for the Marlins isn’t that of the Dodgers… even if Miami fans could actually watch the games.

So it’s far from certain that this deal would withstand muster from MLB, but it does sound like Loria will come out of this smelling like a rose despite all of the issues around him. If not this deal, then another is certainly possible in that same $1.4-$1.6 billion neighborhood.

So Who’s the Buyer?

Some quick research into New-York-based Billionaires deriving their wealth from real estate brings up the name of Richard LeFrak, 209th on Forbes 2016 list of 1800+ billionaires.

The 72-year-old developer is the top-ranked among those firmly fitting all of the criteria, and at $6.4 billion net worth he would have the assets sufficient to guarantee a billion-ish dollar loan. LeFrak is said to be one of the biggest landlords in the New York/New Jersey/Connecticut area (Wikipedia).

The next most possible buyer might be Leonard Stern, a 78-year-old investor and philanthropist from New York worth approximately $4.1 billion. I do not see him as good a fit as LeFrak, though.

AFTERNOON UPDATE:

There are conflicting reports at this hour as to who the buyer might be. Charles Kushner, whose son Jared is the President’s son-in-law, was reported by Ken Rosenthal to be involved, but Jon Heyman is now reporting that the Marlins have denied that report.

Reactions to the notion that the Marlins might soon be sold – to anyone – are already joyous via social media. The figuring here (and with fans, it seems) is that this team can’t go anywhere but up with someone else running that show.

The Braves Angle

10 months ago, we noted that the Forbes’ value of the Atlanta Braves franchise had risen to $1.18 billion… nearly double their assessment of the Marlins.

More from Tomahawk Take

Yet here we are talking about a possible Marlins sale at $1.6 billion… and relatively soon after the Dodgers sold in 2012 for a then-shocking price of $2 billion.

Wow.

Next week marks the 10 year anniversary of the agreement reached by Liberty Media to purchase the Braves. While that’s an interesting milestone, speculation has been raised annually about how much longer this ownership might continue.

That purchase (which included a stock swap) was said to put the team’s value at $450 million at that time.

Between the new stadium, Battery Atlanta, and the launch of new tracking stocks, the annual speculation has been that perhaps Liberty Media is putting together a sequence of steps that would make the team more attractive to a potential buyer.

While that speculation has been denied at every turn, Liberty Media is, after all, a publicly traded company with a fiduciary responsibility to improve the investments of their stock holders.

That tracking stock, which bottomed out at $13.51 a share, peaked at around $21.28 in January and is currently around $19.60.

If the Marlins are worth $1.6 billion, can you imagine what the Braves would be worth?

I would think that any sale would still be more than a year away – after both SunTrust Park and the Battery are both up and fully running, but… how about $2.5 billion? Maybe $3 billion by then?

That’s what I would call “Return on Investment.”

Next: Outfielder on the Upward Track

Meanwhile, Jeffrey Loria could be the one laughing all the way to the bank.

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