Twins Video
In the latest update of the sale of the Minnesota Twins, Charley Walters is citing industry sources who say "the [Minnesota] Twins have an offer on the table."
He goes on to say that "Major League Baseball is expected to guarantee the Twins' debt reportedly more than $400 million."
So, why isn't this bigger news? Well, it's not been confirmed outside of an "industry source" and it's in the "Don't print that" section of the article linked in the tweet above. At this point, it's just a rumor.
What does it mean that MLB is "expected to guarantee the Twins' debt?" Well, that answer is also a bit unclear, but our own @Peter Labuza did some speculating and digging saying "If I had to guess, MLB would "buy" the debt and then have the team pay MLB rather than the Pohlad's...?" He goes on to cite the Debt Service Rule from the Atlanta Braves public filings:
"Each MLB Club is subject to certain MLB imposed restrictions on its ability to incur indebtedness in amounts that exceed specified thresholds. In particular, each MLB Club is generally required to keep outstanding indebtedness minus a certain amount of excludable indebtedness at or below 8.0x available cash flow (or in the case of MLB Clubs which have a new stadium, at or below 12.0x available cash flow), with the amount of excludable indebtedness for fiscal year 2023 set at $125 million and for each of fiscal years 2024 through 2026 set at $100 million. This is referred to as the Debt Service Rule. MLB Clubs must certify compliance with the Debt Service Rule annually and the failure of an MLB Club to comply during two consecutive fiscal years may lead to certain remedial measures being imposed by the Commissioner of Baseball, including, but not limited to, prohibitions on the incurrence of additional indebtedness and repayment of outstanding indebtedness."
Moreover, using the NFL as an example, Labuza says "[NFL] owners can "borrow" from the league at a cheaper interest rates than banks, etc."
On the other hand, @John Bonnes speculates at a more simple explanation, asking "rather than come up 1.5B cash, [maybe prospective owners] can come up with 1.1B cash and take on the $400M loan gradually?"
While it's our speculation and educated guesses on our end, it helps provide a little bit of clarity on a somewhat vague and unclear statement from Walters piece.
Do you have any insight on the matter? Please share in the comments!






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