Aug. 28: MLB Network’s Jon Heyman tweets that “barring something unforeseen,” the sale from Glass to Sherman “will happen.” That certainly moves the ball forward from yesterday’s uncertainty regarding the seriousness of the talks, although it also suggests that no firm agreement is in place. Sherman, notably, would need to be approved by the other 29 ownership groups in the league and by MLB itself, though Heyman adds that Sherman is viewed as a “sure thing” for approval from the league (as one would expect from an executive who is already an established minority owner of another franchise).
Aug. 27, 6:20pm: The Royals have issued the following statement on the matter:
“The Kansas City Royals are not in a position to make any comments on the published speculation regarding any potential sale of the ball club. The Royals will make no further statements at this time.”
5:35pm: Royals owner David Glass is discussing a potential sale of the club with Kansas City businessman John Sherman, Ken Rosenthal and Jayson Stark of The Athletic report (subscription required). ESPN’s Jeff Passan tweets that the two are discussing a price worth north of $1 billion. Glass purchased the Royals in 2000 for a reported sum of $96MM.
Sherman, 64, is currently the vice chairman of the division-rival Indians, having purchased a minority stake in the team back in 2016. As Terry Pluto of the Cleveland Plain Dealer explored last year, Sherman was a Royals season-ticket holder at the time who’d made a fortune in starting natural gas and energy companies (LPG Services Group, Inergy L.P.) and selling them to larger entities. Sherman would, unsurprisingly, divest himself from the Indians organization if a sale is indeed agreed upon (per Passan).
There’s no indication that the two parties are close to an agreement, nor is there any indication that Glass is exploring other sale possibilities in the event that a deal with Sherman cannot be brokered. Asked about the report, general manager Dayton Moore told MLB.com’s Jeffrey Flanagan (Twitter link) that commenting on any potential sale of the club would be “inappropriate.” Glass has not publicly acknowledged the reported negotiations.
Under Glass and Moore, the Royals emerged from irrelevance to appear in consecutive World Series, culminating in a 2015 championship achieved by the core of Salvador Perez, Eric Hosmer, Mike Moustakas, Lorenzo Cain and Danny Duffy. But the Royals have faded from contention in the American League Central in recent seasons and acted to cut payroll in each of the past two offseasons. Though the team was reportedly willing to sign Hosmer to a nine-figure deal to lead the club through the current rebuild, he took a more lucrative offer in San Diego while other stalwarts of that 2015 club have signed elsewhere in free agency or been traded.
The Royals’ Opening Day payroll in 2017 reached the unprecedented (for them) peak of $143MM, but since that time the figure has plummeted rapidly. Kansas City opened the 2019 season with a payroll a bit greater than $96MM, and with Alex Gordon set to come off the books, they have just $59MM in guaranteed salary on next year’s payroll. Offseason trades involving veterans such as Duffy, starter-turned-closer Ian Kennedy, quiet superstar Whit Merrifield or breakout slugger Jorge Soler could further reduce that commitment, though it’s not yet clear how motivated the Royals will be to make any such moves.
Moore has been targeting near-MLB-ready assets in trades and college pitchers in the draft in hopes of architecting a quick turnaround, though certainly a sale of the club could impact not only the offseason direction of the team but the very composition of the front office and the field staff. Flanagan reported within the past week that the Royals are nearing a new television contract with Fox Sports Kansas City, which would more than double their annual rights fees (albeit from an average of $20MM per year to $48-52MM per year), and such an agreement would obviously impact the financial evaluation of the franchise and its baseball operations directives as well.