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Daily coverage of the Mariners during the season and all year long.

April 17, 2012 at 10:18 AM

Baseball Prospectus story says Mariners “perfectly positioned” to be sold

Just in case you missed it, here’s my Talkin’ Baseball segment from today’s Mitch in the Morning show on Sports Radio 950 KJR.
We’ve been around this block quite a bit over the past several months, but now, Baseball Prospectus and well-known sports business analyst Maury Brown have collaborated on a piece taking a look at the Mariners.
Brown’s conclusion is that — while he has no direct evidence the team is for sale — the Mariners are “perfectly positioned” for that exact thing to happen. Yes, he quotes some of our paper’s past work on this issue, but the interesting new stuff to read concerns the franchise’s value and where it now rests in light of the recent $2.15-billion sale price fetched by the Dodgers.
Remember that high-end evaluation of the team’s worth during the Chris Larson divorce trial? That $750-million figure? Brown feels — and shows via comparisons with other clubs — that it was probably right on the money.

One thing I can tell you is that, having sat in on parts of the Larson divorce hearings, everyone in the court seemed in general agreement that the Mariners were worth more than the San Diego Padres.
So, as Brown points out, if the Padres do ultimately fetch $700 million in a sale, then that $750 million figure for the Mariners will likely become reality. And that $641-million figure placed on the team by the judge in the Larson case will seem conservative indeed.
Other factors cited by Brown are worth taking note of. Namely, the team’s future payroll commitments and continued shedding of long-term contracts. The last of those will be out of the way just in time for the team to reap the rewards of an expected new television deal.
Oh yeah, the team’s debt load. This got overlooked by many in the recent Forbes valuations, but the Mariners were said to be carrying a debt-to-value ratio of zero. That, by the way, is the best of any of the MLB teams. Naturally, since it’s tough to get any lower than zero, but no other team has an identical score.
And that debt is unlikely to grow any time soon since the team — have we mentioned this? — continues to cut payroll to ensure that it won’t spend more than it takes in (or burn through their substantial cash reserves) as attendance keeps dropping off due to the fact the team lost 196 games the past two years.
“If ownership is not in a position to (or does not desire to) pour money into the roster with cash calls, the light and easily managed contract structures that the club has in place make it attractive to a would-be buyer,” Brown writes.
Yes, the Mariners are rebuilding. And that’s a darned good thing for them because auditioning several young, cheap players at once supplies the catch-all excuse for the next several years as to why they won’t spend — or ask owners for any cash injections to speed the rebuilding up — as the calendar slowly counts down to that much-awaited TV windfall. Check out what Brown has to say about the team’s TV territory, also something we haven’t covered as much in this paper.
Anyhow, enjoy the read. It will tell you plenty about what is really going on with this team behind those legally-mandated yearly profit/loss statements.



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