If you want the full story of why Irving Picard, trustee for the Bernie Madoff victims, chose to settle, check out my piece at Capital New York . But in the meantime, as we ponder this off day for the team in Florida, here’s the basics as they relate to the Mets.
- If you were hoping the Fred Wilpon ownership group would sell, this is bad news. The trial offered a knockout blow, and had a jury found for the trustee, bankruptcy likely would have followed. (Hence the settlement, as you’ll see in the larger piece.) Instead, the Mets not only have more time- any money due to the trustee wouldn’t begin to be paid out until four years from the date the settlement is approved, or likely April 2016- but the legal avenue is no longer a pathway toward forcing the Wilpon group out. So it is significant, though how significant depends on the issues below.
- The settlement is far from getting the Wilpon group out of financial difficulties. Remember, the sale of minority shares in the team- often ascribed to the lawsuit, or “uncertainty” from the suit, as it was described by the Mets when it started- is not intended to pay any settlement at all, and never was. The $200 million is intended to pay off current pressing debts like the $40 million bridge loan due back to Bank of America, $25 million due back to Major League Baseball, and a portion of the $430 million debt against the team due back in 2014. That portion was $100 million when the deal to David Einhorn nearly went through last summer, and there’s no reason to believe it would be less now.
- They don’t have those investors yet. If the trial is what kept other investors from joining the seven shares already accounted for- one from Saul Katz, one from Jeff Wilpon, four from SNY, and one from hedge fund manager and leading candidate to buy the Dodgers Steven A. Cohen- then we’ll soon see the Mets add more. If the large number of outstanding debts Sterling faces- in addition to those mentioned above, there’s another approximately $600 million due on Citi Field in bi-annual payments that totaled $43.7 million last year and interest on both the Mets debt and a $450 debt against SNY (itself due in 2015) that totaled $50 million last year.
So time will tell if this was merely an ephemeral victory, or the first step in a Wilpon comeback. Make no mistake, however: it was a huge bullet dodged.