Quote:
Originally Posted by duncan_idaho
Let's take a look at that. We have no concrete data on how much of a profit the Royals have been turning, but the estimates I've seen most commonly are $10-15 million a year.
The team value is currently in the $400 million range. He paid $96 million for it originally.
Now that the "Can't profit from selling the team" clause has expired, the only thing holding him back is future returns.
It is possible the Royals continue to grow in value. it's also possible that Moore fails, attendance bottoms out, and the Royals value drops.
If he sells now and gets market value, that's a $300 million profit, on the purchase price. He'd have to run the team for 20 years at the current rate of profit to make that kind of money, and there's no guarantee there.
Financially, getting a huge lump sum like that NOW is more valuable than getting 1/20th of it a year over a long period of time. Smart and cautious investing will take the lump sum and increase it drastically over time.
|
While that is true, he might be looking at it as making 10-20% interest (or more when the ML Payroll was $36 million in 2011) on his initial investment with a nice profitable payday down the road. If I wasn't in it for the long haul, I'd be willing to gamble on that vs. the lump sum and sell off right after the Local TV deal expires so that you can try and get the new deal as part of the sales price.
Of course for that to work, he'd need the team to be somewhat competitive for the next 7-8 years or however long that deal is.
Then again I'm not positive that would work.