Braves Sale Nearing Completion

by gondeee on Feb 6, 2007 2:27 PM EST

Title of this post: Braves Sale Nearing Completion

Other title I could have used: Braves Sale Nearing Completion?

We finally get some minor inkling that the deal between Time Warner and Liberty Media may be nearing completion, this comes to us from the New York Times (hat tip: Rowland's Office):

Based on his vast experience with the sale of baseball teams, Steve Greenberg, a managing director at Allen & Company, said of the pending sale of the Atlanta Braves, "It's always optimal to close a baseball sale during the off-season."

Time Warner, the Braves' owner for the past 11 years, and Liberty Media, the prospective buyer, had hoped to follow Greenberg's advice. Trouble is, they were talking about last off-season. If it's any consolation to them, there's still a chance they can get the deal done before the end of this off-season.

Word among baseball officials in recent days is that the sale is moving closer to completion, maybe reaching that point in the next month or so.

Yes, we know, it's been dragging on for what seems like ever. For those of you who don't know what's at stake in this "swap" here are the particulars:

The Time Warner deal calls for Malone to return $1.8 billion in Time Warner stock, receiving in return the Braves, valued at $450 million, and the rest in cash.

It feels like the Braves are "the team to be named later;" the Crash Davis among the throngs of doubloons changing hands. One can almost see the topic of adding the Braves to this deal coming up over brandy one evening.

Time Warner Exec: Yes John, we'd love to have $1.8 billion dollars worth of our stock back.
John Malone: Keep in mind I want plenty of cash in return, but I also don't want that damned IRS to take any of it. It's my money, mine.
Time Warner Exec: Would you like one of our networks, perhaps you'd enjoy the Cartoon Network.
John Malone: No, they're all a bunch of damned terrorists.
Time Warner Exec: How about HBO? You like movies right?
John Malone: No, I'm more of a Skinemax kind of guy.
Time Warner Exec: Hummm.
John Malone: I like hot dogs...
Time Warner Exec: Hey! What would you say to a whole bunch of hot dog stands?
John Malone: Really! What are these stands called, where are they?
Time Warner Exec: They're called the Ted and they're in a stadium thingy we own in Atlanta.
John Malone: Oh really, Atlanta. Could I move it to somewhere nicer like Milwaukee?
Time Warner Exec: No actually, this stadium is where this team plays called the Braves. They're a baseball team, perhaps you've heard of them.
John Malone: Have they ever been on Skinemax after dark?
Time Warner Exec: I don't think so, but they're a baseball team, they play baseball...
John Malone: Is that like foosball?
Time Warner Exec: Um...yes.
John Malone: Sweet!
Time Warner Exec: Hell yeah it's sweet!
John Malone: Okay, so I get the cash, those hot dog stands, and this Braves thingy, and I'm not paying any taxes, right?
Time Warner Exec: Yep. But it's going to take a lot of lawyers to figure this one out.
John Malone: Well, how much am I saving on taxes with this?
Time Warner Exec: Probably something like $200 million.
John Malone: Well, there you go; spend that on lawyers.
Time Warner Exec: That's a lot to spend on lawyers.
John Malone: Hey, if they can make it so I don't have to pay any taxes then they're worth-it.
Time Warner Exec: Right, but...
John Malone: Shh, they're worth it.

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I Think

If memory serves, there is some tax amortization thing worth hundreds of millions of dollars that may expire soon if they don't make the swap.

I don't expect Liberty Media to care what happens to the Braves. This is a massive tax write-off for them since they can claim half the purchase price of the team as a loss over the next five years. So the braves might soon be the lowest salary team in the bigs.

by mhsiegel14 on Feb 7, 2007 6:10 PM EST reply actions

From what i understand

Liberty has stated already that the payroll would not in fact lower. Granted, they could just be blowing smoke, but MLB shouldn't approve a sale where a company is knowingly going to junk them. Thats why they prefer private owners over conglomerates. I've even heard rumor they would be open to raising the payroll if things were right. We'll see though. I'm not really optimistic or pessimistic about all this. Anything would be better than Time Warner i believe.

.....Matt

by yondaime4 on Feb 8, 2007 1:28 AM EST reply actions