The New York Mets announced Thursday that the proposed sale of a controlling interest in the team to hedge fund manager Steve Cohen had collapsed, but that the Wilpon family and Saul Katz are still looking for a buyer for the franchise.
Cohen attempted to purchase an 80 percent share of the Mets in a transaction that would have valued the team at $2.6 billion.
Mets, Cohen Confirm Deal is Dead
Cohen currently owns 8 percent of the team, a stake he purchased for $40 million in 2012.
Rumors surfaced earlier this week that the deal might be falling apart. Sources cited by The New York Post suggested Cohen was unhappy with the Wilpons for attempting to change the terms of the agreement deep into negotiations.
The proposed agreement would have allowed Fred Wilpon to remain in the position of CEO for five more years, while his son Jeff Wilpon would have stayed as COO for the same five-year period. The Post report cited sources as saying that the Wilpons were attempting to retain some control beyond that time frame. There may also have been some disagreement on the long-term status of SNY, the cable television network owned by the Wilpons.
On Thursday, Sterling Partners – the Mets ownership group – released a statement confirming that the deal was off.
While the deal with Steve Cohen fell through, the Mets are still going to be sold, according to a statement released by the team’s ownership: pic.twitter.com/6AaXnHDfj8
— Jeff Passan (@JeffPassan) February 7, 2020
“The transaction between Sterling and Steve Cohen was a highly complicated one,†the statement read. “Despite the efforts of the parties over the past several months, it became apparent that the transaction as contemplated would have been too difficult to execute.â€
Cohen released his own statement, saying that he “gave it [his] best shot†to push the deal through.
Statement from Steve Cohen on the collapse of his attempt to purchase the Mets: pic.twitter.com/Oq6SC0hdbT
— Kevin Draper (@kevinmdraper) February 7, 2020
“I’m very disappointed we couldn’t work out a deal, but as an 8 percent holder I’m looking forward to a higher bid for the team,†Cohen said in his statement. “I want to thank the fans for their support and the respect they showed me and I want to thank Commissioner Manfred and MLB for their support through the process.â€
MLB, Mets See Bad Faith in Negotiation Over Team Control
The Wilpons aren’t done trying to sell the team, however. The Mets announced that New York-based investment bank Allen & Company will manage the sale going forward. No candidates have emerged as potential buyers at this time.
Meanwhile, Major League Baseball could block Cohen from purchasing a team in the future. Sources told The Post that Cohen had signed a term sheet that agreed to the essential principles of the deal, including leaving Fred Wilpon as the official “control person†for the franchise for a five-year period.
MLB requires each team to have a single control person “with ultimate authority and responsibility for making all Club decisions.†The Post’s sources said that Cohen balked at leaving Wilpon in control once he realized the substantial power that came with the “control person†position.
“Why would anyone put up $2.6 billion and not have any say in the operations of the business he was buying?†one source told The Post. “That doesn’t make any sense. Anyone who tells you any different isn’t credible. The governance issues always had to be worked out and they just never got there.â€
The Mets and MLB officials may see the fact that Cohen agreed to those terms initially as a sign that he was acting in bad faith, however. That, along with his controversial background as a hedge fund manager, could make it difficult for him to earn support from owners if he tries to buy a team again in the future.
