Miami Marlins owner Jeffrey Loria has reached an agreement in principle to sell the team to a group headed by former Florida Governor Jeb Bush and former New York Yankees superstar shortstop Derek Jeter.
‘In principle’ simply means that the deal needs to be approved by Major League Baseball, and the contract lawyers need to shore up their side of the deal. When all is said and done, the Miami Marlins will exchange ownership to the tune of $1.3 billion. Yes, with a “B.”
The process could take months to finalize, though both sides are optimistic the deal will come through, according to the Miami Herald. CBS reports the two sides will have an opportunity to discuss the sale with the league in May.
Barry Jackson, the story’s reporter, cited numerous reasons why Loria decided to sell the team, including
"his belief that leaving baseball and getting his estate in order was prudent at this stage of his life at 76; sadness over the death of Jose Fernandez; unhappiness with years of being criticized by fans; and prolonged losing since winning a World Series in 2003, among other factors."
Loria’s reasoning is simple to understand. His priorities have changed. Even so, the pool of investors knocking at the opportunity to purchase the franchise has some familiar names which signify a larger change in the sports landscape.
In need of a turnaround
Miami has missed the last 13 playoffs. Since winning the 2003 World Series, the team finished over .500 four times and drew over two million fans only once.
On the diamond, Loria backloaded the contracts of many of his stars including slugger Giancarlo Stanton and pitcher Wei-Yin Chen. This will result in a significantly higher payroll for the incoming owners barring any trades. However, a rising payroll is only a problem if the new owners fail to bring fans to Marlins Park. In 2016, only the Atlanta Braves had a lower attendance rate than Miami, who drew just over 1.7 million fans to their 80 home games. The Marlins made just over $200 million in 2016, ranking near the bottom of the league.
Bush plans to be the team’s “control person” according to the Herald. He plans to oversee the team’s operations on a macro level. In this sense, Jeter seems to be a political play for Bush to get his foot in the door.
A business of admiration
Loria has made no secret about his affinity for Derek Jeter. He was a Yankees fan growing up, and according to the Herald article, Loria holds the former Yankee star in high regard.
Bush has also made no secret about his desire to be a MLB franchise owner. He tried unsuccessfully to purchase the team three years ago when he and Jeter were competing for the team.
When they entered their bid together, they had the most powerful name draw in the auction, and won the opportunity outright.
However, there is some doubt whether or not Jeter and Bush will be the first to touch all the necessary bases. ABC News reported on Wednesday morning that multiple offers are currently on the table for the franchise. MLB Commissioner Rob Manfred said the winning group will ultimately have a financial structure – some debt and the rest equity – consistent with the league’s debt service rule.
Under the new Collective Bargaining Agreement, the debt service rule was expanded to include club-supported debt incurred by the club or any club-related party.
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It seems that no matter what the league rules, Loria will try to sell the franchise to the most-fit political buyer. Loria’s two most recent attempts to sell the franchise have both been in deals with Republican figures. In February, the Kushner family was in talks with the Marlins owner to buy the team. But after Loria’s name came up for appointment as Ambassador to France, they backed out citing a conflict of interest given Jared’s many roles in the White House.
The Bush family has a long history in baseball as well. George H.W. Bush played baseball at Yale University; George W. was part owner of the Texas Rangers and threw out the first pitch in New York following 9/11; and Jeb has been a fan his whole life.
In 2016, Loria contributed $116,527 in total to the Republican party during the election process, according to OpenSecrets.org. His business primarily donated to the Republican National Committee ($33,400) and many Republican campaigns in various states. Loria previously donated to Democratic parties up until 2013 when he helped finance Cory Booker’s (D-NJ) election campaign.
If you’ve ever questioned whether or not professional sports has been reduced to political rubble, there’s your answer.
Forbes valued the Marlins franchise at $940 million in April 2017. Out of the 31 teams in the league, Miami ranks 25th. If the franchise is worth the price tag the investment group put on them, they’d be in the top 10 between the Washington Nationals and Philadelphia Phillies. Miami has also consistently under-performed in its market, limping to a $200 million revenue in 2016.
No matter who the team sells to, Loria is due to see a near 10-fold increase on his $158.5 million investment.