How Excited Should Fans Be About Pohlad Family Plans to Sell Minnesota Twins?

[gregens]

37 minutes ago, Yoke said:

I just want to be mad at somebody different.

After reading this thread and the other Pohlad selling thread, I'd say you've come to the right place.

I'm just going to ride the drama out and hope for the best.

[nicksaviking]

19 minutes ago, Nashvilletwin said:

 

The Pohlads are not dumb. They are savvy investors and operators and have been successful across two generations with a third well on the way. 

 

Not Joe Pohlad. The only two businesses I've found publicly disclosed were two radio stations he was handed to run for no other reason than they wanted to give him something to do. Both he absolutely screwed up and the family was forced to sell for pennies on the dollar.

https://bringmethenews.com/minnesota-lifestyle/former-pohlad-owned-radio-stations-officially-flip-formats

https://www.skornorth.com/episode/minnesota-twins-are-tone-deaf-addressing-their-2024-season-collapse/

If you have other information on Joe, please share. What are his qualifications other than having Pohlad as his last name? 

[JADBP]

54 minutes ago, Nashvilletwin said:

Absolutely not true.  I’ve written this several times on this site and will say it again: on a cash basis the Twins have been losing over tens of millions on an annual basis in the 2020s and could lose over $50MM this year.  I have often written about the decisions the family needs to make every year to find the cash to keep supporting the business and the financial analysis required to warrant/justify that amount of funding. 

Sorry, there is little evidence to suggest that the Twins lost $50 million this year.  And that is an insane amount.  If it were true, that would suggest that the Twins Mgmt is horrible at running a profitable business and they would ALL have been canned.  It certainly would be insane to sell the team after suffering a $50 million loss.  

What this really points to is four things:

1) The family today does not have the affection for the Twins that Carl and Eloise had for decades (before and after buying the team).  It wasn't vanity, it was affection, that spurred Carl to buy the team.  Today, Jim, Bob and Bill Pohlad are the current owners with Joe as currently EVP (apparently Jim was bored with running the Twins).  They see the team very differently than Carl--as an annual paycheck (as if they needed one), or a P&L statement, rather than a cherished part of the community.  So, it seems like they just want to cash out.

2) I am guessing that they cut $30 million to try to even out the losses of the Bally contract--making them whole for the year.  In their mind, they need to pocket $10 each and every year for upkeep of the mansions on Lake Mtka.   What they really miss is how long term Sports management works to earn dollars.  Carl understood community investment much better, trying to build value in the team as an asset to the community builds equity. 

4) The living Pohlads have been poor stewards as they seem to be bad at hiring people to run their investment.  There are far more profitable stream revenue streams than MLB or even Bally--companies that are rabidly expanding into sports steaming and have far far deeper pockets (Amazon, Microsoft,  etc).  That must be too complicated for them--all this new-fangled computer stuff!  So, they keep plodding along with the same old-school management (because it is comfortable) and they manage the team into a tragic decline.  The management is as near-sided as they can be.  It appears that don't care about winning games, just making $$ to hang on to their jobs.  

Rather than try to fix this mess that the Pohlad sons have made, they likely believe the estimates and are dreaming of splitting up $1.6 Billion three ways.  Pathetic!

[Major League Ready]

8 hours ago, nicksaviking said:

Even if those investments are paying 10/20/30/40M dividends per year and give you options for tax-payer funded auxiliary land development?

Look, I've been arguing all day that current ownership is likely the same as new ownership, but this was still a sweetheart deal.

No doubt this has been a great investment for the Pohlad family.  It's a very select few businesses that have the sustained growth of MLB.   I don't believe that same rate of growth will be recognized going forward which makes it hard to believe they get $1.5B.  It also makes your point.  A potential owner could make $150M/year off an alternative investment.  Are they going to be satisfied with making $25M if the valuation is unlikely to grow as it has in the past?   There are not too many Steve Cohens out there, especially for a Midwest franchise.

I looked at spending for 10 years and the Twins spending percentages or spend against rank were actually a little more aggressive than the league on average.  I don't think it's likely we get an owner willing to make less after laying out $1.5B but like you will remain hopeful.  IMO, the greatest potential impact is in getting an owner that makes organization changes that result in better messaging / marketing.  In other words, the greater potential is on growing revenue as opposed to spending more of what they already have.

[old nurse]

16 hours ago, Cap'n Piranha said:

Until you realize that $44M put in a DJIA index fund in 1984 is worth $1.6B today.  I'm also skeptical they get $1.5B, when an Orioles team with more history and a more attractive location "only" got $1.765.  Even the Mets were sold for $2.4B--do we really think a team in the largest media market, by far, in the country is not worth even 2x the Twins?

The Mets are in the largest media market that cares about the Yankees. The fans do out to Yankees games. Cohen made the big spasm with a lot of big money signings. It did not bring fans to the half empty stadium. So yes the Mets are not worth 2x the Twins

[NYCTK]

29 minutes ago, old nurse said:

The Mets are in the largest media market that cares about the Yankees. The fans do out to Yankees games. Cohen made the big spasm with a lot of big money signings. It did not bring fans to the half empty stadium. So yes the Mets are not worth 2x the Twins

Potential value of the Mets IS the Yankees and Cohen is doing his best to get there. 

Yankees are old news. Are they more popular with the old families in NY, sure, but NYC is a transient city. 2/3 of New Yorkers weren't born in NYC. And the Mets are way more popular with this demographic. 

The Yankees are a boring corporate team. The Mets are fun. The only reason the Mets aren't already bigger than the Yankees is, despite having a far superior stadium, the game day experience is lacking. Well, Cohen is spending a bunch of money to develop the area around Citi to try to fix that. 

So, are the Mets 2x as valuable as the Twins? Absolutely. 

LFGM 

[sjunisu]

18 hours ago, bean5302 said:

Acquiring the Twins will probably cost in the neighborhood of $1.5B. They typically run an operating income (profit) of about $10-20MM, which is a terrible investment, and a big chunk of revenue is about to disappear. The overall profitability of the Twins, even when considering market value, is under the S&P 500 Index fund so owning the Twins hasn't been a great investment for the Pohlad family for the last 30 years or so.

In fact, most baseball teams aren't great investments. In order to provide a the return which would outperform the general stock market, you have to grow the market value, which is honestly accomplished through attendance (fan experience) or national exposure (winning World Series' or employing big name players).

So there has to be another motivation behind the acquisitions.

You are gaslighting all of us.  Not a good investment?  They bought the club for $44m and will get probably $1.5b while netting the $10-20m operating income each year.  Unbelievable return.  This comment is trying to rewrite the cheapness of the Pohlads.  Even including their investment for the stadium, their return is somewhere between 500-1000% not including annual income.

[Major League Ready]

20 minutes ago, sjunisu said:

You are gaslighting all of us.  Not a good investment?  They bought the club for $44m and will get probably $1.5b while netting the $10-20m operating income each year.  Unbelievable return.  This comment is trying to rewrite the cheapness of the Pohlads.  Even including their investment for the stadium, their return is somewhere between 500-1000% not including annual income.

Unbelievable?  

Let's say they get 1,385,000 for the team.  That's $1.2B after the stadium investment.   Then, let's say they averaged $20M/year for 40 years which is generous given the earnings were much less in the early years.  That's exactly $2B on a $44M investment.  Had they invested $44M in a S&P 500 fund, that investment would be worth almost exactly $2B today.  Nobody is rewriting the facts.  You simply don't understand the math.

[Woof Bronzer]

9 hours ago, Nashvilletwin said:

 I’ve written this several times on this site and will say it again: on a cash basis the Twins have been losing over tens of millions on an annual basis in the 2020s and could lose over $50MM this year.

Just because you say something over and over doesn't make it true. "I keep saying it, but the Twins cleared a billion in profit last year."  See how easy it is?  Doesn't make it any more true.  Truth requires things like evidence or data.

9 hours ago, Nashvilletwin said:

to find the cash to keep supporting the business and the financial analysis required to warrant/justify that amount of funding. 

The Pohlads are worth 4 billion dollars and are one of the wealthiest families on the planet. 

9 hours ago, Nashvilletwin said:

The Pohlads are not dumb. They are savvy investors and operators and have been successful across two generations with a third well on the way.

Joe Pohlad's only experience in business is running several media companies into the ground and selling them for pennies.  He has no history of success, none.  Most people on this board are more qualified to run the team than he is.  The Twins make so much money the older Pohlads gave Joe the Twins as a toy so he'd stop ruining their other businesses, and because they hate the Twins and don't want anything to do with running the team.  I'm guessing the elders saw how quickly Joe was able to tank the Twins, saw that in a new tv revenue environment they'd actually have to work for revenue, and are sick of their name being associated with cheapness and losing, so they're cashing out.  It must have been really comforting to know that no matter how badly they ran the Twins, how poorly they did on the field, how drastically they alienated their customer base, they had a $1.5 billion windfall waiting for them.

9 hours ago, Nashvilletwin said:

Say what you want about the Pohlads, but they live, invest, create jobs, and support lots of charities in our state.

If not for a single judge the Pohlads would have killed this franchise 25 years ago.  

Congratulations, this is the most pocket protecting-est post ever made on this site, and that's saying something! 

[Riverbrian]

12 hours ago, Mike Sixel said:

Not to mention the cash they pocketed in years they had low payroll...

Could be... I don't know. 

It does beg a question.

If they are putting annual cash in their pocket. 44 Million investment has grown to a 1.5B valuation over the decades.

Why Sell? 

I don't know the answer to that. But the question does beg. 

[Craig Arko]

I guess I stopped short of peeing myself.

[TopGunn#22]

As a guy who grew up with Calvin Griffith as the owner and Howard Fox as the GM, a duo who invented the word "penurious" and then with the Pohlad's, another family who took the word "penurious" to a new level and a front office hack like Dave St. Peter, I am THRILLED at the news they will be selling the team.

No, I'm not expecting Steve Cohen level payrolls.  Absolutely NOT.  I will give the Pohlad's credit for OK'ing the FA signing of Jack Morris prior to the 1991 season.  Jack and the Twins gave us possibly the greatest season in Twins history, going from "worst to first" and beating the Braves in an all time great World Series.  

And then in true Pohlad form, after 1991, they refused to pay Jack Morris a fair salary for what he had helped the Twins accomplish and Morris instead signed with Toronto, the team we had beaten the previous season to go to the World Series.  And what did Jack Morris do?  He helped lead the Blue Jays to their first World Series triumph.  In a nutshell, THAT was the Pohlad family. 

We as Twins fans have suffered under two family ownerships that rarely ever made a bold move to "go for it" at the trade deadline.  Guys like Jack Morris, Chilli Davis, Shane Mack, or even a Carlos Correa were all off season moves.  This last season's trade deadline was frustrating, but no more frustrating than the 2000's when we had two MVP's (Mauer & Morneau) a multiple CY Young Winner (Johan Santana) and the best closer in Twins history, (future Hall of Famer Joe Nathan) and not one of us can name any kind of significant trade deadline acquisition that made a difference.  A decade of potential WASTED.

It will be interesting to see who materializes as potential buyers.  I wonder if A-Rod and Lorre would rather own a baseball team??  We have been sold this "small market" drivel for so long some of us actually believe it.  The Twin Cities is TV market #15 in the nation.  That's firmly middle of the pack in the professional sports world.  The inability of the Pohlad family to ever actually leverage this is on them.  They are bankers.  They have absolutely no media savvy and it showed in their inability to leverage their TV market size and their lack of ever having an effective marketing strategy.

You look at this Twins roster and how many league minimum contracts we have or extremely affordable contracts for pitchers like Ryan and Ober and you realize there is no way they can't be more efficient.  This front office made the blunders of signing Vasquez to a 3-year $30 million dollar contract.  Who signed off on that???  They calculated that Kyle Farmer was a "good value" at $6 million dollars per year.  They overpaid Caleb Theilbar for 2 consecutive seasons as the most expensive arm in our bullpen.  

Whenever the new ownership group takes over there are going to be HUGE changes for the Twins.  There will certainly be some mistakes made, but expect this to be Rocco's final season as Twins manager.  Expect to see Falvey let go in addition to Dave St. Peter and a host of others.  The new ownership group will want their own people in place.  What will be key with the new ownership group, more than how much they decide to spend on payroll, will be who they choose to replace the people listed above.  What infusion of bright, young baseball minds currently laboring for other franchises can they bring in to re-set the course of this Twins franchise.  

I'm hoping for a manager who not only utilizes analytics but who also has some baseball instincts.  Who manages a more aggressive, exciting brand of baseball.  Something resembling how the Brewers play the game, but with a payroll that should put our franchise several rungs above Milwaukee.  I'm looking for a scouting and drafting department that starts to add more athleticism than we have previously.  And I'm looking to a team that will continue to churn out home grown pitching with the hopes they can avoid the Matt Canterino "school of injuries." 

We are a team with some serious issues but one that is not bereft of talent and potential.  I think the Pohlad's realized that they have so antagonized their fan base that they realized they weren't willing to spend the necessary payroll to correct the many bad trades and puzzling free agent acquisitions (Vasquez, Farmer, Gallo, Shoemaker, Happ etc...) to begin to regain that trust. 

We are the verge of a new era for Twins baseball.  I don't expect a quick sale, but I also don't expect something as long, drawn out and convoluted as the Timberwolves situation.  The new ownership could prove to be worse.  But after having endured Calvin Griffith and the Pohlad family, I'll gladly take my chances with who that might be.    

[terrydactyls]

17 hours ago, Brandon27 said:

One dont get to excited cause I am not excited and two it's 50/50 look at angels owner try for two years to sell the team and nothing until we see headlines saying polhads officially sold the team I will jump for joy but overall they are still owners they can still pull a glen taylor and not sell the team.

Try using punctuation next time.

[spanman2]

20 hours ago, bean5302 said:

The likely biggest bonus for the organization and fans is a new owner not being tied to Dave St. Peter and the front office's failed marketing strategy. Butts in the seats = revenue. Revenue = payroll capacity. Dave St. Peter has failed in his goals for 5 straight years and he's still running the show.

If a new owner puts a better marketer in place, the Twins are going to draw much better.

How did St. Peter ascend that position....mystery!

[USAFChief]

10 hours ago, Nashvilletwin said:

Absolutely not true.  I’ve written this several times on this site and will say it again: on a cash basis the Twins have been losing over tens of millions on an annual basis in the 2020s and could lose over $50MM this year.  I have often written about the decisions the family needs to make every year to find the cash to keep supporting the business and the financial analysis required to warrant/justify that amount of funding. 

The Pohlads are not dumb. They are savvy investors and operators and have been successful across two generations with a third well on the way.  Sure, they could sustain the losses while the equity values were climbing.  But now, the certainty of those rising equity values - especially for small/mid market teams - is unclear.  Said another way, the rate of return on the cash needed to annually fund the team has increased because the risk of the equity growth has risen.  They have other better, more attractive investment opportunities. 

We all know the Pohlads have never been “vanity” owners.  The decision to sell now should be a wake-up call to all of you; namely, the Twins as a business is not as attractive as you think.  If it were - if the team were spewing out big cash flow every year - the Pohlads would be keeping it.  But the franchise is not and that is why they are selling.

For all of our sakes, I hope a “vanity” buyer does appear. But those are actually few and far between and especially for markets like the Twin Cities. Consequently, keep in mind, the new owners may likely be a consortium of investors and quite possibly with no ties to this community.

Say what you want about the Pohlads, but they live, invest, create jobs, and support lots of charities in our state.  We will be lucky to find those community ties in the new owners.  In a state as provincial as Minnesota, those ties actually can be important.  The Wilfs have done an excellent job developing those ties and are a great example of excellent leadership from an outside owner. Of course, the economics of the NFL are completely different than MLB (especially for a franchise like the Twins in a no salary cap league).

I don't think there is even a small chance the family is losing cash on an annual basis.

Of course, unless you're a Pohlad, neither of us know for sure, since they don't open their books.

But Forbes agrees with me. Here's 2023:

https://www.forbes.com/teams/minnesota-twins/

 

According to their estimates, the Twins had an operating income of $19m last year.

 

 

 

[old nurse]

3 hours ago, NYCTK said:

Potential value of the Mets IS the Yankees and Cohen is doing his best to get there. 

Yankees are old news. Are they more popular with the old families in NY, sure, but NYC is a transient city. 2/3 of New Yorkers weren't born in NYC. And the Mets are way more popular with this demographic. 

The Yankees are a boring corporate team. The Mets are fun. The only reason the Mets aren't already bigger than the Yankees is, despite having a far superior stadium, the game day experience is lacking. Well, Cohen is spending a bunch of money to develop the area around Citi to try to fix that. 

So, are the Mets 2x as valuable as the Twins? Absolutely. 

LFGM 

They are only worth twice as much as the Twins if and only if they can capture more of the market . YES pays 143 million. SNT pays the Mets 88 million.  Average ticket price fore the Yankees is $276. Average ticket price for the Mets is $28 per Statistica. Per Statistica the Mets are about $280 million behind the Yankees The Mets have a long way to go to catch up to the Yankees.  It may never happen. So no, it is not absolutely 

[Trov]

This article makes good points.  One, will the new boss be same as old boss?  Most likely, unless you get an owner that is so rich from other things that they view owning the team as a fun entertainment, but most owners do not think like that, they think about making money.  Second, very few people actually has the money to buy the team, so it normally will require several investors, which most investors want to actually see a return on that, and not just on paper but in actual funds.  So that means making money.  

Additionally, new owners will normally mean clean house, clear out who you think is not worth keeping, which generally means shedding payroll too. 

[NYCTK]

3 minutes ago, old nurse said:

They are only worth twice as much as the Twins if and only if they can capture more of the market . YES pays 143 million. SNT pays the Mets 88 million.  Average ticket price fore the Yankees is $276. Average ticket price for the Mets is $28 per Statistica. Per Statistica the Mets are about $280 million behind the Yankees The Mets have a long way to go to catch up to the Yankees.  It may never happen. So no, it is not absolutely 

Fun Fact: Mets LCS tickets are going for twice as much as Yankees LCS tickets on the secondary market right now. 

The Yankees aren't fun and everyone in the city knows this. The Yankees...they're a hat company. Do not be surprised if the Mets overcome the Yankees as THE New York team in the next 3 years. 

If the Yankees are truly a $7 Billion, franchise, I can tell you that Steve Cohen envisions the Mets potential value instead of their current value. Forbes has them at $2.9B? That's nice, but Steve thinks they can be $5B in 5 years. And $10B in 10 years. 

So, I say again, are the Mets worth 2x as much as the Twins? Hell yeah they are. 

 

[USAFChief]

32 minutes ago, old nurse said:

They are only worth twice as much as the Twins if and only if they can capture more of the market 

The Mets sold for $2.4B in 2020 and are currently estimated to be worth $2.9B per Forbes.

So yes, they're worth roughly twice what the Twins are worth.

 

Also, FYI, per Statista the average NYY ticket was just under $66 in 2023, not $276.

 

https://www.statista.com/statistics/203489/new-york-yankees-average-ticket-price/#:~:text=Published by,data was available for 2017.

[Doctor Gast]

If Falvey & Co. are still around next year even with new ownership I still don't see any change. A little extra money for Falvey to blow in FA isn't going to change anything either.

[Schmoeman5]

On 10/10/2024 at 1:49 PM, tarheeltwinsfan said:

Don Beaver lives in North Carolina. 

And.... Fred Beaver lives in Michigan. Bucky Beaver lives in the woods.

[USAFChief]

11 minutes ago, Schmoeman5 said:

And.... Fred Beaver lives in Michigan. Bucky Beaver lives in the woods.

Beaver Cleaver lived in Mayfield.

[Patzky]

It's worth ten minutes of your time.

 

https://tcbmag.com/analysis-selling-the-twins/

[Craig Arko]

35 minutes ago, Patzky said:

It's worth ten minutes of your time.

 

https://tcbmag.com/analysis-selling-the-twins/

That was quite interesting. Thanks.

[Mike Sixel]

3 minutes ago, Craig Arko said:

That was quite interesting. Thanks.

It was good, but for a nuanced take, it didn't mention spending in ANY year, other than the year they spent the most. So, not really nuanced. This line "But the narrative that they are misers who squeeze the team for profit is equally absurd." is followed by a bunch of data that totally ignores the years they didn't spend. 

[Craig Arko]

3 minutes ago, Mike Sixel said:

It was good, but for a nuanced take, it didn't mention spending in ANY year, other than the year they spent the most. So, not really nuanced. This line "But the narrative that they are misers who squeeze the team for profit is equally absurd." is followed by a bunch of data that totally ignores the years they didn't spend. 

Okey-dokey.

[Al from SoDak]

On 10/10/2024 at 2:51 PM, adjacent said:

I did some simple math: 44 million, corrected for inflation (assuming 3% a year, some years it was more, but many years was less, so that would not be that off) would be approximately 143 million in today's dollars. If they sell in $1.5 B that sounds not too bad as an investment, does it?

Nobody would buy a baseball team just to keep up with inflation. If you assume 9-10% percent return on investment (which I certinaly expect from my 401K), their return would be $1.3B to $1.8 billion. Right in line with the expected sale price. 

[Major League Ready]

7 minutes ago, Mike Sixel said:

It was good, but for a nuanced take, it didn't mention spending in ANY year, other than the year they spent the most. So, not really nuanced. This line "But the narrative that they are misers who squeeze the team for profit is equally absurd." is followed by a bunch of data that totally ignores the years they didn't spend. 

I have to agree with you that a writer who asks us to accept a position should provide information that validates their position.  We have seen dozens of articles here proclaiming the Twins were cheap with nothing but innuendo and antidotal evidence.  I guess it's the norm on this topic to make unsupported assertions and conclusions.  Wouldn't it be great if a TD writer were to actually put together a synopsis payroll vs revenue compared to all the other teams for the last 10 or 20 years?   Then, we could all speak from an informed point of view. 

[Dave Borton]

8 minutes ago, Al from SoDak said:

If you assume 9-10% percent return on investment (which I certinaly expect from my 401K), their return would be $1.3B to $1.8 billion. Right in line with the expected sale price

This agrees with my calculation but with a retired IRA, mine is tuned down and is muted. <Winks>.

[Mike Sixel]

13 minutes ago, Major League Ready said:

I have to agree with you that a writer who asks us to accept a position should provide information that validates their position.  We have seen dozens of articles here proclaiming the Twins were cheap with nothing but innuendo and antidotal evidence.  I guess it's the norm on this topic to make unsupported assertions and conclusions.  Wouldn't it be great if a TD writer were to actually put together a synopsis payroll vs revenue compared to all the other teams for the last 10 or 20 years?   Then, we could all speak from an informed point of view. 

I liked the tone a lot....but it wasn't nuanced. Which is what they wanted us to believe. As sports owners, they are likely vilified more than needed. I won't speak about other stuff....