There has been no indication John Henry intends to divest his stake in the Red SoxGETTY IMAGES
The potential merger between SPAC RedBall Acquisition Corp. and Fenway Sports Group is a "complicated deal, potentially worth billions," and if it is "ultimately consummated, it would have a wide-ranging impact, some of which can't yet be fully known," according to Sean McAdam of the BOSTON SPORTS JOURNAL. Despite some predictions, Red Sox Owner John Henry "does not appear to have any interest in divesting his share" of the franchise, of whom he "remains principal owner." It has been "estimated that Henry's share of [the] ballclub is somewhere in the neighborhood" of 40%. In theory, the RedBall-FSG deal "could provide more working capital with which to operate" the Red Sox. But, due to its "international appeal, investing in soccer teams may prove more lucrative." For example, while the Red Sox "have increased in value nearly five times in the last 18 years, the purchase of Liverpool has already grown to six times the purchase price in a shorter (10 year) period." How much of the new income "would be re-invested into the Red Sox day-to-day operations, of course, is uncertain." Unlike the Packers, who are "completely owned by hundreds of thousands of shareholders, purchasing the publicly-traded [RedBall] would mean that you own a small stake in an investment group that owns a portion of the parent company of the Red Sox" (BOSTONSPORTSJOURNAL.com, 10/13).
A PIECE OF THE PIE: In Boston, Silverman & Edelman note if RedBall completes the merger, the shares of FSG that are traded on the NYSE "would represent a 20-plus percent slice of the Fenway Sports Group pie." Smith College professor of economics Andrew Zimbalist said, "If you were to buy shares in this SPAC, you wouldn't have any control over what John Henry and [Red Sox Chair] Tom Werner do about players or renovating Fenway Park or anything like that but you would have a stake in the Red Sox indirectly. So if the Red Sox did really well, made a profit and the SPAC made profits, or if John Henry and Tom Werner sold the Red Sox and they had a capital gain, then you as an owner of a piece of the team would be able to make some money off of it. In that way it might be fun" (BOSTON GLOBE, 10/14).
