How Attractive Is the Minnesota Twins Franchise to Potential Buyers?

[Guest]

18 hours ago, bean5302 said:

The Twins lease at Target Field doesn't expire until 2040, and it explicitly forbids the Twins from relocating. They're not moving until at least very close to 2040, if they would be allowed to break the lease at all (which they weren't with just one year left at the Metrodome).

One word:  money.

The lease's NPV will be just another negotiating point in a 1-2 billion $ deal.

[bean5302]

12 minutes ago, Minderbinder said:

One word:  money.

The lease's NPV will be just another negotiating point in a 1-2 billion $ deal.

The Twins have no rights to alter the relocation clause. It'd be like saying part of the negotiation was the guarantee of good weather for every Twins home game. Beyond that, MLB owners wouldn't approve the sale or the move if there was a relocation involved.

Your scenario isn't realistic for a number of reasons, even with a strong dose of anti-billionaire cynicism.

[sun]

The Twins will most certainly be sold. And it's not only about the profitability of the team. Among the reasons why the ultra-wealthy buy sports teams is to enjoy the tax write offs through the 15 year amortization law. That way the owner can save millions in taxes for 15 years which coincidentally corresponds to the amount of time that the current Pohlad family has owned the team (since 2009 I believe). If the team is sold quickly it will correspond to the end of theTarget Field lease & the new owner will be at the 15 year window of opportunity to sell the team again . Owning a sports team is a big tax write off for the wealthy owner for the first 15 years. The linked article describes how the write offs work. 

The Billionaire Playbook: How Sports Owners Use Their Teams to Avoid Millions in Taxes

https://www.propublica.org/article/the-billionaire-playbook-how-sports-owners-use-their-teams-to-avoid-millions-in-taxes

BTW, the bonus depreciation benefit for new owners is being eliminated after 2026.

https://www.sportico.com/business/finance/2022/coveted-tax-write-off-for-sports-team-1234699071/

[DJL44]

46 minutes ago, sun said:

The Twins will most certainly be sold. And it's not only about the profitability of the team. Among the reasons why the ultra-wealthy buy sports teams is to enjoy the tax writes offs through the 15 year amortization law. That way the owner can save millions in taxes for 15 years which coincidentally corresponds to the amount of time that the current Pohlad family has owned the team (since 2009 I believe). If the team is sold quickly it will correspond to the end of theTarget Field lease & the new owner will be at the 15 year window of opportunity to sell the team again . Owning a sports team is a big tax write off for the wealthy owner for the first 15 years. The linked article describes how the write offs work. 

The Billionaire Playbook: How Sports Owners Use Their Teams to Avoid Millions in Taxes

https://www.propublica.org/article/the-billionaire-playbook-how-sports-owners-use-their-teams-to-avoid-millions-in-taxes

BTW, the bonus depreciation benefit for new owners is being eliminated after 2026.

https://www.sportico.com/business/finance/2022/coveted-tax-write-off-for-sports-team-1234699071/

100% this.

[SaberNerd]

The reason the Twins will likely be sold for a lot of money really just has to do with a simple premise: people like owning a sports team.  Valuations have been going up in MLB not because the economics have gotten much better, but there has just been a number of rich tech/finance people who want to own a sports team.  They are willing to pay more for the business than it would be worth from a purely financial standpoint.

 

I would be shocked if the team moved.  Minnesota would become the largest market to not have a team, and I'm not sure MLB would allow it.

[mrcharlie]

On 10/12/2024 at 9:51 AM, chpettit19 said:

As far as just the Twins as a stand alone product, I think their attractiveness comes down to a prospective buyer's feelings on how well the Pohlads maximized the Twin Cities market. I've been quite vocal that I think they've failed miserably and there's a great deal of room to improve and draw more fans, and thus increase revenue. So I think they're pretty attractive when it comes to mid-market teams.

The complicating factor is that it's not just about the Twins, it's also about MLB as a product. It's an interesting time to be trying to sell. Right in the middle of the switch away from RSNs as you switch to streaming. The prospective buyer must also trust the league office to maneuver through the next handful of years and find the right path to revenue growth away from RSNs. Or the new buyers have to have their own plan with a good understanding of the media market. 

Another point to consider is the future of the MLB and players agreement.  So, yes the position of MLB as an entertainment product would be important to a potential buyer.  

[twinssporto]

Interesting article, you could have wrote the buying prospectus! If the majority of Twins Daily members were qualified investors I'd say let's buy the team!!

 

 

[Reptevia]

22 hours ago, akmanak said:

The fact that the owners kept payroll in line with how much revenue they generated shows clearly that they were in line with the norm.

Really?  Have you seen the books??  No one else has seen them. 

[Reptevia]

On 10/12/2024 at 9:06 PM, FargoFanMan said:

Other than Lewis all the guys had average seasons as far as games played. Not injury prone.

Kiriloff?  Ryan?  Topa?  Wallner?  Lee?

[Trov]

There are 2 kind of sports owners.  There are the owners that have a ton of money and loves the sport and wants to win and uses the ownership as entertainment and looks to either break even or lose a little bit while team value grows and they live off their other businesses.  Then there is the business investor that actually wants to make money on their investment.  These type of owners will run the team with as little of payroll they can if they are getting butts in seats and money in pocket.  Oakland(soon to be Vegas), Pittsburgh, and a few other teams run like this.  

I hope we get the type that loves the game and makes tons of money from other businesses and is fine breaking even.  Owners will not look at a team that is on verge of winning a possible championship as a reason to buy a team.  That barely makes a difference in long run for making money. Short term it helps, but long term it will not matter.  No owner will be looking for a short term flip. 

I do not know who will be out there that will be looking.  We will see.  My guess is no sale happens anytime soon. 

[TopGunn#22]

I'm not expecting the "new" owners (when a sale finally does happen) to spend a ton to sign 3 high profile free agents.  But I will say this:  As soon as there is new ownership there will be a honeymoon period.  Fans will be overjoyed that we are finally done with the Pohlad family and will be excited about what the new ownership group "might" do.

In other words, the bar will be low for the first couple years for the new ownership group to regain the trust and enthusiasm of the fans.  All this new ownership needs to do is push payroll back up to the $160 million dollar level by making a bold move or two to add talent to the roster. 

The Twins already have a plethora of guys who make league minimum or a little higher.  Any new owner who takes a hard look at what Cleveland, Kansas City and Detroit are doing will realize that the Twins aren't too far behind them, but that a couple bold moves are needed to put the Twins in position to re-take the division crown.

The Royals, Guardians and Tigers should force the Twins new ownership and quite possibly a new FO and manager (there is no requirement for new ownership to stick with someone else's "team") to step up to the plate and be ready to compete in what could be MLB's toughest division.  New Twins ownership should welcome this competitive atmosphere.   

[dxpavelka]

On 10/13/2024 at 6:28 AM, Doctor Wu said:

Very good article, and many good responses. Lots of factors at play. Over the weekend I was thinking about the whole idea of selling the Twins, and how realistic this sale will be, and how soon it could happen, I'm no financial analyst or business tycoon so this is all uncharted territory for me. But with all the uncertainty regarding TV and/or streaming packages and revenue, it doesn't seem like a particularly good time to be putting your team on the market. As someone pointed out, unless the price is very affordable, chances are you aren't getting to have a bunch of buyers lining up to buy your baseball team. I will be pleasantly surprised if the team can be sold before the start of next season, but I doubt that will happen. Which means another year of frugality and despair. 

Doc you should have been here BEFORE the current ownership bought the team.

[Doctor Wu]

6 minutes ago, dxpavelka said:

Doc you should have been here BEFORE the current ownership bought the team.

Ah yes, I DO remember the Calvin Griffith days! Other than 1967, there were MANY painful years back in those days. 

[dxpavelka]

12 hours ago, Doctor Wu said:

Ah yes, I DO remember the Calvin Griffith days! Other than 1967, there were MANY painful years back in those days. 

65, 69 and 70 weren't bad either.  Trading away Blylevin & Carew sucked.  I'd like to think the purge in 81 & 82 lead to 87 & 91.

[FargoFanMan]

On 10/14/2024 at 7:56 AM, Reptevia said:

Kiriloff?  Ryan?  Topa?  Wallner?  Lee?

I was referring to average compared to all other 29 teams. Twins were about middle of the pack in days lost to injury.