Brewers franchise value and ability to spend money

[stoutdude04]

 

For the Reds comp. If I added correctly, Brewers won about 50 more games over that span. Each made the playoffs 3 times, Reds won 0 playoff series and have missed 6 straight years now. Brewers won 2 and made two NLCS making it to games 6 and 7. Somewhat surprisingly, the 10-15 years prior to 2010 the Reds were more or less just as bad as the Brewers too, I didn't remember them being that poor.

 

This is what I took from it. People want the Brewers to spend more money, but just because you spend more does not mean that they are going to win more.

 

It is entirely possible that the Brewers data thinks Garcia will outperform Castellanos and the other parts they've picked up will perform at a similar production as those they let slip past. I personally think they will be fine this year if they stay healthy.

[clancyphile]

 

For the Reds comp. If I added correctly, Brewers won about 50 more games over that span. Each made the playoffs 3 times, Reds won 0 playoff series and have missed 6 straight years now. Brewers won 2 and made two NLCS making it to games 6 and 7. Somewhat surprisingly, the 10-15 years prior to 2010 the Reds were more or less just as bad as the Brewers too, I didn't remember them being that poor.

 

This is what I took from it. People want the Brewers to spend more money, but just because you spend more does not mean that they are going to win more.

 

It is entirely possible that the Brewers data thinks Garcia will outperform Castellanos and the other parts they've picked up will perform at a similar production as those they let slip past. I personally think they will be fine this year if they stay healthy.

 

Plus, they don't have to spend money to bring in new players to get better.

 

It could be they decided that money could be better spent on keeping their team as healthy as possible.

 

They could be upgrading the player facilities to get more out of the current players.

 

It won't show up on payroll, but it has an effect on the field.

[Eye Black]

Axios Sports shared some updated data and information about owners personal wealth (cited Forbes as data source).

 

The new Mets owner, Steve Cohen, is now the wealthiest owner in baseball, and if these numbers are accurate it’s not even close.

 

 

 

Below are the reported franchise values in charts separated by AL and NL (this data is listed as from June of 2020 and they cited Forbes on this data as well). As had already been established in this thread the franchise values aren’t directly indicative of what type of cash flow the team has to spend currently.

 

 

 

 

 

 

Here is a slightly deeper dive on the specifics of the NL Central owners. The financial numbers listed next to the teams here is franchise value and NOT owners wealth.

 

NL Central

 

Cubs ($3.3B): Tom Ricketts, 57 — His father, Joe, founded brokerage firm Ameritrade. In 2009, he paid $845 million for a 95% stake in the team, 25% of the local sports network and 100% of Wrigley Field.

 

Cardinals ($2.2B): Bill DeWitt, Jr., 78 — He founded an investment firm, which became part of the group that purchased the team from Anheuser-Busch in 1995 for $150 million.

 

Pirates ($1.26B): Bob Nutting, 58 — His great-grandfather founded Ogden Newspapers in West Virginia in the 1890s, which Nutting now runs. Publisher McClatchy bought the team for $95 million in 1996, and Nutting took over as chairman in 2007.

 

Brewers ($1.2B): Mark Attanasio, 62 — The lawyer-turned-investment banker bought the Brewers for $223 million in 2005.

 

Reds ($1.08B): Bob Castellini, 78 — The Castellini family, owners of a 124-year-old produce wholesaler, are a Cincinnati staple. Before leading the group that bought the Reds for $270 million in 2005, Bob owned minority shares of the Rangers, Cardinals and Orioles.

[pacopete4]

Who will be the first to assume MA has $1.2 billion to spend on the payroll? Any takers?

[MrTPlush]

Who will be the first to assume MA has $1.2 billion to spend on the payroll? Any takers?

 

But will they try and connect the Nationals 9% increase in value to winning a World Series. Thus making it an example of why we should spend more?

[jerichoholicninja]

Who will be the first to assume MA has $1.2 billion to spend on the payroll? Any takers?

 

He's nothing like that cheapskate Steinbrennber. There's no reason the Yankees payroll shouldn't be at least $4 billion.

[markedman5]

Who will be the first to assume MA has $1.2 billion to spend on the payroll? Any takers?

 

He's nothing like that cheapskate Steinbrennber. There's no reason the Yankees payroll shouldn't be at least $4 billion.

 

Yep.........nothing happens in a vacuum......

[JosephC]

Axios Sports shared some updated data and information about owners personal wealth (cited Forbes as data source).

 

The new Mets owner, Steve Cohen, is now the wealthiest owner in baseball, and if these numbers are accurate it’s not even close.

 

 

 

Below are the reported franchise values in charts separated by AL and NL (this data is listed as from June of 2020 and they cited Forbes on this data as well). As had already been established in this thread the franchise values aren’t directly indicative of what type of cash flow the team has to spend currently.

 

 

 

 

 

 

Here is a slightly deeper dive on the specifics of the NL Central owners. The financial numbers listed next to the teams here is franchise value and NOT owners wealth.

 

NL Central

 

Cubs ($3.3B): Tom Ricketts, 57 — His father, Joe, founded brokerage firm Ameritrade. In 2009, he paid $845 million for a 95% stake in the team, 25% of the local sports network and 100% of Wrigley Field.

 

Cardinals ($2.2B): Bill DeWitt, Jr., 78 — He founded an investment firm, which became part of the group that purchased the team from Anheuser-Busch in 1995 for $150 million.

 

Pirates ($1.26B): Bob Nutting, 58 — His great-grandfather founded Ogden Newspapers in West Virginia in the 1890s, which Nutting now runs. Publisher McClatchy bought the team for $95 million in 1996, and Nutting took over as chairman in 2007.

 

Brewers ($1.2B): Mark Attanasio, 62 — The lawyer-turned-investment banker bought the Brewers for $223 million in 2005.

 

Reds ($1.08B): Bob Castellini, 78 — The Castellini family, owners of a 124-year-old produce wholesaler, are a Cincinnati staple. Before leading the group that bought the Reds for $270 million in 2005, Bob owned minority shares of the Rangers, Cardinals and Orioles.

 

I don't think that MLB owners have voted on Cohen yet. The media will likely just ignore it, but IMO it's a real black eye for MLB if he is approved.

 

I just hope that if Cohen is approved, that the individual owner's votes are made public. That way, when any owner that voted yes decides to fire some low-level nobody employee to demonstrate that his organization "always does the right thing," then I will know beyond any shadow of a doubt that the particular owner is two-faced and completely full of crap.

 

https://www.sec.gov/news/press-release/2013-129

 

https://www.ft.com/content/efda2ca2-ec69-11e6-930f-061b01e23655

[3and2Fastball]

The value of the Brewers franchise has increased dramatically since Mark bought the team ($223 million to 1.2 Billion). About a 500% return on investment in 15 years is a remarkable success.

 

I think Mark recognizes that having a team that wins and contends adds to the value in ticket sales and merch sales etc.

 

If he and his investment group took even just 5% of their immense increased value ($50 million or so) and added it to the yearly payroll, they’d have a much better chance of winning a World Series. They won’t do that though, for multiple reasons.

[DuWayne Steurer]

The value of the Brewers franchise has increased dramatically since Mark bought the team ($223 million to 1.2 Billion). About a 500% return on investment in 15 years is a remarkable success.

 

I think Mark recognizes that having a team that wins and contends adds to the value in ticket sales and merch sales etc.

 

If he and his investment group took even just 5% of their immense increased value ($50 million or so) and added it to the yearly payroll, they’d have a much better chance of winning a World Series. They won’t do that though, for multiple reasons.

 

One of those reasons is that value isn't cash on hand.

[TigerUppercut]

The value of the Brewers franchise has increased dramatically since Mark bought the team ($223 million to 1.2 Billion). About a 500% return on investment in 15 years is a remarkable success.

 

I think Mark recognizes that having a team that wins and contends adds to the value in ticket sales and merch sales etc.

 

If he and his investment group took even just 5% of their immense increased value ($50 million or so) and added it to the yearly payroll, they’d have a much better chance of winning a World Series. They won’t do that though, for multiple reasons.

 

Great thought, bad real world point as this can pretty much be said about every single franchise in baseball.

[3and2Fastball]

Billionaires have a ready ability to acquire an extra $20-$50 million at any time. Billionaires in general don’t become or stay Billionaires by making a habit of risking their own money. And, yes, every MLB team could take the same roll of the dice in pursuing titles.

 

Having said that, to think that the Brewers “cannot afford to increase payroll” is laughably inaccurate. It’s a choice. Just as I have a choice as to whether to continue buying tickets to see a franchise that won’t take the extra steps to win. The fact that the Brewers don’t care about whether I spend money on them (as long as enough other fans do continue to spend money on them) is irrelevent.

 

The value of the franchise went from $223 million to $1.2 billion in 15 years! That is incredible. I don’t think it is at all a stretch of the imagination to say that Mark cares much more about profits and continuing to increase the value of his investment than he does about World Series titles.

 

How we as fans choose to think about that reality is our choice.

[bork]

Not sure what this all means, but Mark is selling a majority of his stake in his investment firm for $338 million.

 

https://www.wsj.com/articles/sun-life-financial-to-buy-majority-stake-in-crescent-capital-11603365943

[monty57]

Payroll will be based on projected revenues, not franchise value.

 

"Dipping into franchise value" means taking on debt, just like taking a home equity loan. If a team takes on debt to increase payroll, then they will have to pay back that debt, thereby lowering the amount of money available for future payrolls.

 

Since payroll will be based on projected revenues, what a team will spend this offseason will largely be based on whether they think they will play a full season next year, how many fans will be allowed into the stadium, and how willing will people be to go to a game, even if they are allowed.

 

It's a guess, and finance guys and gals don't like guessing. Some teams will probably cut payroll substantially, while others will "roll the dice" and sign some deals that would be well "below market" if the Covid stigma wasn't hanging out there.

[Fear The Chorizo]

There won't be an influx of cash coming from late fall/early winter season ticket sales for the 2021 season to close out the year, that's for darn sure.

 

Estimated values for what an organization is worth if it is sold right now means nothing when it comes to their player payroll capacity. By all accounts the Brewers set a revenue record for their franchise in 2019 as an organization and lost money on their operating balance sheet.

[Simba2020]

Forbes basically downplayed the impact on Covid in their team valuations. Part of their justification even seemed rather bizarre. They seemed to almost justify the overall increase due to how much the Cubs have increased in value since the Ricketts bought the Cubs during the financial crisis. While true, I don't think there is any doubt that the $700 million purchase price was negatively impacted by the financial crisis. I think the same would be true today. Perhaps the Mets didn't sell at a discounted price but that is the New York market with a potential owner with the deepest pockets in the game. Not a true comparison for most teams. It would seem with the great uncertainty surrounding the sport right now, the Brewers being worth $1.2 billion is a pipe dream.