The Indians are looking to sell a significant minority stake in the team, according to Josh Kosman and Claire Atkinson of the New York Post. Owner Paul Dolan enlisted boutique investment bank Allen & Co. several months ago to sell roughly 30% of his team. Sources say that Allen wants to involve a new investor so that he can increase the club’s payroll. Over the weekend, Dolan confirmed to Paul Hoynes of The Plain Dealer that he is seeking a minority owner and he explained that the process has been going on “for nearly a year.”
So far, Dolan has yet to find a taker due largely to his asking price. Dolan believes that the team is worth roughly $800MM, but many disagree with that assessment. The Indians, at present, are only breaking even. Making matters worse, the team does not own a regional sports network like some other clubs do and they’re in the early stages of a long-term media rights deal.
One source familiar with the process says that he doesn’t see much financial upside with the Indians at this time. Without a big TV deal, sports industry sources tell The Post duo that the Indians are worth about $600MM in total. The Padres went for $800MM in 2012, but they had the benefit of a fat $1.2 billion TV deal.
The Indians have been near the bottom of the league in payroll in recent years and with the exception of 2001, they have never had an Opening Day tally higher than $90MM. This year, the Indians had an Opening Day payroll of just under $88MM, which put them in the bottom five in MLB. The Indians are 62-66 heading into today’s game against the Angels.
Indians attendance rankings the last 4 years:
2012: 29th
2013: 29th
2014: 30th
2015: currently, 29th
This is not a very good investment currently, it appears Clevelanders just don’t want to watch baseball, period.
Exactly what I was going to post. Its really hard to see the team as a good investment for prospective owners; especially without a TV deal in place.
You’re telling me that if there were one of 30 houses available in a pristine location…and you could get a good deal…all it needed was.some improvements…you wouldn’t take that deal?
My issue is that it’s only a minority interest. Cleveland is ripe for someone to come in…no stadium issue like Tampa or Oakland….teams drawn well in the past and Ohio loves their sports…. Team has a rich history..etc. I’ll take Cleveland at $600M over the Cubs at $3B…I like the profit potential and challenge. Buy low sell high
I’m not sold that putting a winner on the field is gonna bring the crowds back. The Indians were in the thick of the playoff race last year and still ranked dead last in attendance. It depends on your risk level. You obviously see it as a great investment, I do not. And i’m clearly not alone given how long they have been looking for a minority owner.
You are right about the fans not caring. One guy on a blog posted that he went back from out of town to visit his folks in August, and no one anywhere was talking about the Indians.
The ownership and front office have alienated an entire region.
Really not much different than Pittsburgh a few years ago…they couldn’t draw there very well
Minority ownsership gives little to no say…you’re still at the profit whim of the Dolans. You’d need controlling interest. I’m not sure that an infrequent wild car contention is enough to spark attendance up…but a culture shift would. That’s what happened in the early 90s
Not true at all. The area is as sports-crazy as anywhere in America.
Having lived in the area, I can tell you that Cleveland supports any team that is trying to win. The Cavs sell out the season with Lebron (they were about middle in NBA attendance without him), the Browns – a lousy team since they were reborn in 1999 – either sells-out seasons or comes close.
The Indians set attendance records in the 90’s when they (finally) had good teams. Within a few years after the franchise was sold, both the owner and the GM – now president – told the fans to get over the 90’s, it wasn’t coming back. They then went into never-ending rebuilds where there drafting has been horrible and the teams pretty much unwatchable. When the team continued losing, the FO blamed that on the fans not supporting the team more – not on the bad drafting, trades and development. None of this went down well with the local fans, and they continued to stay away from giving the ownership any money. Meanwhile, the FO and PR department kept making excuses for the teams poor play, blaming everyone but themselves. They categorized the team as “small market” and told the fans they could only contend once every five years due to inequitable payrolls – not exactly the sort of thing a business tells their potential customers. That has bitten the dust as fans have watched the Royals and Pirates build powerhouses on a similar budget – made funnier by the Pirates GM being an Indians assistant GM when they hired him.
Currently the area is hoping Mark Shapiro goes to Toronto. Fans overwhelmingly will tell you that he has been arrogant and condescending during his 14 year tenure. While he’s been a silver-throated PR guy with the media (especially the national media), Indians fans don’t care for him (to put it mildly) and don’t trust him. But even if he leaves, the current ownership will continue in place, and no one cares for them either.
I have friends in Northeast Ohio and around the country that grew up Indians fans, most of whom stopped following the team, and those that did root against it in hopes that the owner will sell and bring in a competent front office.
Keep in mind that the current front office has been in place for 14 years. No ownership committed to winning would allow this for that period of time.
If Dolan feels the team is worth $800M, maybe he should sell. Attendance doesn’t worry me either. It’s a franchise that will historically support an organization that goes out to put a winner on the field. I think it favorably compares to KC…even if the iron belt has taken a hit over the years. Veeck drew there at the old stadium… They drew for most of a decade around the turn of this century.
In fact, I’d think they’d be a fairly attractive team for a potential owner that wants to win. Pretty ripe business if they want to invest…could possibly be had cheaper than other teams with long historic tradition. Fans show up when they win.
There was an editorial in the local paper 4 or 5 years ago that I remember. The semi-retired head of the Editorial department asked publicly that the Dolan family sell the franchise to someone(s) that had the money to run it.
They have been shopping minority ownership for years. Who in their right mind would give these people money and not have a say in the operation? The mere fact that they’e doing this proves the Editorial columnist was correct – they do not have the financial wherewithal to run a major league franchise.
The resentment in the area is also due to people saying that it’s a bad baseball town, which could not be further from the truth. Run the teams they’ve had out in NYC, Boston, LA and elsewhere and see how well they draw.
Cleveland is a good baseball town…just like KC always has been. I don’t fault working people from not forking over their budget to go to games when they don’t believe in the ownership.
I did a study on potentially available ownership situations. Cleveland is the organization I came back with. But that’s also price considerate. Team with history, in a region that has recently shown they’ll support a team..and likely available at a good price. That’s how you make a profit as an owner. Anyone can say being Chicago Cubs owner or Yankee owner is a cash cow…but Cleveland is very undervalued.
The Indians went from selling out every single game for a decade to the worst attendance in the game: I’m sorry but you are just wrong, the numbers don’t lie: Cleveland has all but abandoned the Indians. Even in the bad years you don’t go from all-sellouts to worst in the game over an extended period. Bottom 10 makes sense, but constantly 29 or 30th? Something is very wrong in Cleveland when the Rays are drawing more than them.
You do when you don’t have a bunch of yuppies and corporations buying ticket blocks regardless of how the team performs. Cleveland is blue collar. They’re loyal too…but they don’t put up with garbage, not should they. They deserve a local Illitch type owner. They really aren’t that different than KC has been. I’m just saying a fan base can’t entirely be assessed by attendance.
Numbers mean nothing if you do not understand what caused them.
The attendance started dropping when the team was sold, and accelerated when the current front office was put in place.
You want to ignore that, fine.
I don’t know…to me low is when you buy. Good team with history in an area that has shown fairly recently that they will support a winner. I guess if you want to be an absentee owner and just cash checks…maybe move on…but if you want to try and win and have a sense of community boosterism….Indians are your team…and the fans will likely respond and love you for it
Don’t want to watch Bad Baseball !
The Indians have been seeking minority ownership for years. Apparently this is the latest foray.
I don’t know who’d want a no say minority relationship with the Dolans. I’d come in with a solid buyout deal and let the Dolans get out of the way and set off to build a great organization… Stadium is solid…no Oakland or Tampa type stadium issues…great baseball people… Just dormant…that’s a winner to me
They could get a minority owners if he/she/they had an option to buy controlling interest in x amount of years.
The Padres went for $800MM in 2012, but they had the benefit of a fat $1.2 billion TV deal.
Oh and let me tell you, the Padres have been worth every dollar!
Just like Max Scherzer has been worth every dollar to the Nationals.
Snicker, Snicker.
Who in their right mind would want to buy a ball club these days?
Fans are overpaying to see games on TV and Live in Person at the Stadiums.
Owners are overpaying players.
It’s preposterous!
I, for one, would like to buy a ball club.
They’re cash cows.
The only real hindrance is being hampered by a subpar tv deal. They’re TV broadcasts are very boring for some reason. I believe it’s because they don’t mic
the stadium or the game action properly…always very quiet. The radio of the game over the video always has more ingame sound.
I want to buy the Cleveland Indians as a project…its exactly what I’d do…good people there. I might even consider forming a commission to work with native americsn groups to design a new logo that could become a tradition in itself that could retire Chief Wahoo. This block C just doesn’t cut it.
“Who in their right mind would want to buy a ball club these days?”
People who enjoy making massive amounts of money off a near-trillion dollar industry.
I actually do feel that the time to get in was a few years back. The profit margin on teams sold now is staggering
What are you talking about? Why even bring up Scherzer when he’s having a pretty great year?
You’re right, I don’t think Bryce Harper will be buying ownership stake in the Indians. Great point.
Selling Low, must know something about Long Term Projections for Profit that the Average Fans doesn’t Have info on !
Any team can draw when it is able to field a winner. Cleveland seems to be filled with bandwagoners-only attending when they win, and sometimes (like last year) not even then. Being upset at ownership because they say that Cleveland is a small market (they are) and can’t afford a large budget is ridiculous. They are at a disadvantage without a TV deal that is as lucrative as those being given out currently. New minority ownership will not change the revenue stream, unless the payment goes to payroll. Even if it were, once it is spent, what then?
As to the comment comparing them to KC, why anyone would want to follow that template is beyond me. KC languished in last place forever in order to acquire the talent with high draft picks that they have now. With Gordon’s Free Agency, the window is already beginning to shut. What will be interesting is to see what happens to the KC attendance after their run.
Clevelander here – The lesson I’ve learned from the last 20 years of following the Indians is this: IF there’s a new stadium AND you put murderer’s row on the field every night AND the Browns are gone, it’s a great baseball town. Otherwise, you can build it and they will not come. See 2005 (24th in attendance), 2007 (21st), 2013 (28th), 2014 (29th). People are still griping about losing CC and Cliff Lee (who they didn’t come to see while they were here) and can’t appreciate that Michael Brantey and Carlos Carrasco are better players at this point.
I wouldn’t touch owning a share of this team with a 39.5 foot pole.
I believe she is interested in buying the team.
http://www.baconsports.com/wp-content/uploads/2013/02/majorleagueloubrown.jpg
Rachel Phelps will only try to move the club to Miami so she doesn’t have to end up feeding Cha Cha real dog food. She’ll break the lease with the city if the attendance falls below 800,000 for the season. Besides… Does anyone want the showgirl wife of Donald Phelps owning a major league team?