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Leagues and Governing Bodies

With sale, will market for MLB clubs open up?

The Seattle Mariners are under the majority control of team investor John Stanton after his acquisition, valued at $1.4 billion, was approved here last week by team owners.

So will that deal now loosen up a historically slow market for MLB franchise sales?

Before the Stanton deal for the Mariners, four years went by after the 2012 acquisition of the San Diego Padres by a group led by Ron Fowler. The gap represents the longest period between team sales in baseball’s four-decade free agency era.

The Mariners, for their part, said they are projecting a seamless transition, and Stanton’s 17-member investor group also has many members of the previous ownership group, including himself and retired Microsoft executive Chris Larson, who joined Stanton for the approval vote here.

But the $1.4 billion valuation on the Mariners deal, second among baseball teams only to the $2.15 billion purchase of the Los Angeles Dodgers by Guggenheim Baseball Management in 2012, has some MLB team owners and senior executives wondering if this now reignites the dormant market.

John Stanton, seen at a Mariners news conference in April, won approval for his acquisition from MLB owners.
Photo by: AP IMAGES
“Right now, there’s definitely more buyers than sellers, and that tends to drive the market,” Miami Marlins President David Samson said. “We’re clearly in a period of real asset appreciation and growth for the sport, and I would certainly think the Mariners represent the new floor for a team. But ultimately, there will need to be a new equilibrium in terms of balancing back out the buyers and sellers.”

For many team owners, there are plenty of reasons to stay, and no other MLB teams have a majority stake for sale. The sport is rising toward $10 billion in annual revenue, and most teams are quite healthy and profitable. Elements such as MLB Advanced Media and its BAM Tech spinoff provide powerful additional avenues to growth and valuable equity for owners, buttressed by the recent $1 billion Disney deal for a third of BAM Tech. The league also has done more in recent years to screen ownership candidates and find people more deeply committed to baseball.

The next labor deal will have much to say on what happens to the market for MLB franchises. The league and the MLB Players Association are working on a new agreement to succeed the current five-year pact expiring Dec. 1. MLB Commissioner Rob Manfred has expressed repeatedly, including here at these meetings, a high degree of confidence in being able to complete a new deal without significant problems.

“We have a nice, complete inventory of issues on the table, and we have had a good, respectful exchange at the table,” Manfred said. “We’re now into that phase of the process where we’re looking to package some things up and start to make agreements on issues.”

What that deal means for the sport’s future economics, however, remains unknown, as both sides have said little on the specific content of the talks, in keeping with their policies of the past decade. But even amid the sport’s current run of historic on-field competitive balance, several small-market owners, including those in Oakland, Pittsburgh and Tampa, would like to see more mechanisms to ensure there is not a return of the sport’s fiscal and talent imbalance of the 1990s.

WBC WAITING GAME: Owners heard an update on progress toward next year’s World Baseball Classic, and formal announcements are expected soon on venues for the international tournament, including the semifinals and final.

The Tokyo Dome and Seoul’s Gocheok Sky Dome were announced earlier this month as host facilities for some first- and second-round games, and the next series of announcements will include U.S. and Latin American venues that will also form key pieces of the event. Industry sources said that Miami’s Marlins Park will be a site of first-round games, and that Seattle’s Safeco Field will also play a key role.

The 2013 version of the tournament, owned and run by MLB and the MLB Players Association, concluded at San Francisco’s AT&T Park.

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