Cubs purchase

[old nurse]

Long, but interesing

https://deadspin.com/the-inside-story-of-how-the-ricketts-family-schemed-and-1831879476

[glunn]

 

Long, but interesing

https://deadspin.com/the-inside-story-of-how-the-ricketts-family-schemed-and-1831879476

Thanks for posting this. I enjoyed it.

[twinssporto]

 

Long, but interesing

https://deadspin.com/the-inside-story-of-how-the-ricketts-family-schemed-and-1831879476

 

Thanks for sharing.  Interesting story!

[snap4birds]

What I found most interesting.  

*Marlene sells 15mm shares @ $11.85 for gross proceeds of $177,750,000. Sale proceeds net of taxes and fees is $149,310,000.00.

* Education Trust sells 19mm shares @ $11.85 for gross proceeds of $ $225,244,800. Sale proceeds net of taxes and fees is $189,205,632.

* Total net proceeds from the sale are $338,515,632.

 

AMTD currently selling around $52.00.  Selling those 34 million shares today would bring around 1.768 billion, instead of the 338 million they got.  So the 'opportunity cost' of owning the Cubs could turn out to be a losing proposition for the Ricketts family.  I know Mike Sixel always says that no one has ever lost money owning a baseball team, because they always make a profit with they sell.  That statement may be true, but this shows why owners like to make money off their teams on a yearly basis, too.

[dbminn]

You made me curious, Snap. Here's my view: 

 

Forbes lists the Cubs 2018 franchise value at $2.9 billion. The original purchase price was $845 million, but they put in only $350M in equity. Their return on equity is much higher as owners of the Cubs than as Ameritrade shareholders, at least on paper. (By my amateur assessment. I'm certainly not an accountant.)

 

Sounds like Zell could be in tax trouble if the feds care at all.

 

Old Nurse - Thanks for posting the link!

 

 

[Mike Sixel]

 

What I found most interesting.  

*Marlene sells 15mm shares @ $11.85 for gross proceeds of $177,750,000. Sale proceeds net of taxes and fees is $149,310,000.00.

* Education Trust sells 19mm shares @ $11.85 for gross proceeds of $ $225,244,800. Sale proceeds net of taxes and fees is $189,205,632.

* Total net proceeds from the sale are $338,515,632.

 

AMTD currently selling around $52.00.  Selling those 34 million shares today would bring around 1.768 billion, instead of the 338 million they got.  So the 'opportunity cost' of owning the Cubs could turn out to be a losing proposition for the Ricketts family.  I know Mike Sixel always says that no one has ever lost money owning a baseball team, because they always make a profit with they sell.  That statement may be true, but this shows why owners like to make money off their teams on a yearly basis, too.

 

I've never claimed they couldn't make more money other ways....but those ways carry risk. This way carries opportunity cost, but not risk. Let's compare this to investing in "risk free" investments....

 

Also, it shows that there isn't really free market capitalism around these sales (just as there isn't at all for players and their lack of freedom for years and years).