The cubs are now for sale. It was page 1 news on the Wall Street Journal today (Specifically that the Tribune comapny would now entertain offers for any properties they own. Mentioned in the article was the LA Times and the Cubs.)

Speculation is the team fetches $700 million.

So who buys it?

Drum roll please .........

The next owner of the Cubs will be Andy McPahil. This is why he left in September, he saw this coming and need to leave to devote time to form an investor group to buy the team. Conflicts of interest prevent him from doing this while employed by the Tribune Company.

The Tribune company saw this coming which is why they have a temporary head in John McDonough. No point in hiring a new executive.

He will set up something similar to Reinsdorf. McPhail will be the chairman. No big names (or, if they are, they will have small parts and have no power. Similar to Steinbrenner when he held 1/7 of the Bulls in the 1980s/1990s). No big names allows McPhail to run the team.

The tax issues will not be a road block.

Now the bad news.

Hendry has no power to do much this off-season. Everything will be done in order to increase the value of the team. That means no long-term deals, this gives new management maximum flexibility. So, look for 95 to 100 losses next year. No A-Rod, Sheff, Soriano, Aramas is gone, no Zito.

Word lately is McPhail is struggling to raise the money (targeting $700 million). He might have to borrow a good deal which will restrict his ability to increase payroll. Look for HUGE increases in ticket prices (30% in two years).

Lastly, Pinella could be a problem. When Sternberg and Silverman bought the Rays, and started telling Lou how to run the team, he quit. McPhail will have his money on the line, not the Tribs, and will be more "active" in telling Lou what to do. Lou might not make it to the all-star game. He has a clause in his contract that let's him walk with two year base if ownership changes hands.

Hendry is out, which is why he did not leave with McPhail. McPhail goes back to the GM role.

article if you don't want to pay for wsj http://www.chicagobusiness.com/cgi-bin/news.pl?id=22727

To be clear. McPhail doesn't need money. He'll get that from others on Wall Street.

The Red Soxs, Devil Rays and Rangers are all owned by Wall Streeters and many more are looking to INVEST (not run) a teams. They don't view them as ego trips. They think they are good investments.

What McPhail has is 12 years of running this very team. And they way he ran it, watching the bottom line, makes him an ideal candidate for those sitting in the owner's box.

This is why the Ernie Banks and Steve Stone rumors are bunk, they have no experience running a baseball team.

Bain Capital of Boston will back him. Remember them? They tried to buy the entire NHL when they were on strike last year.

I'll look at the bright side. Murph will be able to use my favorite drop again, his "Andy the Clown" drop. That is if he doesn't have a grabber first.

I had a far fetched dream that Stoney would put together a group and be the Cub version of the Chairman. I'll have to settle for the Andy "the clown" drop instead.

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We all have private ails. The troublemakers are they who need public cures for their private ails.- Eric Hoffer

I know the wet dream is some zillionare is going to buy this team and try and outspend the Yankees. Never ever ever ever going to happen.

First the cubs already are a high payroll team so money has never been the problem.

Second, drawing three million when you lose 96 games, means revenues are stable. This is going to attract McPhail types to leverage the hell of themselves (borrow a lot of the purchase price) to buy. They can keep putting a shit product out there, three million will show up, and they can suck cash out of it, and become rich. They will need to suck cash as the most expensive player will be "debt prepayment." He needs to be paid first before the starting rotation is address.

If the cubs drew 18,000 to a game after this year, at least you would force an owner to realize he needs to win to keep making money. Not with the Cubs which is why the price will be so high.

Fact is the Tribune is/was the deep pocketed owner. The next owner will be an overleveraged financer looking to pull money out. If they win, they are going to have to do it with a $80 million payroll a-la the Sox (2005), Marlins (2003), Detriot (this year).

So, let's stop this fanatasy of what well-known billionaire is going to buy the Cubs and put a $150 million payroll to win. That billionaire was the Tribune organization.

OK, call me a sucker, but the article you linked didn;t have anything to do with mcfail buying the cubs, just about the Trib selling assets???

I think what you have laid out is pretty interesting. The one thing I don't quite understand is your "debt prepayment" discussion. Are you saying that they only need to maintain one superstar to ensure the attendance, i.e. revenue stream?

Also, I understand your point that the consistent revenues mean low volatility and give investors an opportunity to leverage the debt against the future cash flows. But wouldn't this mean only that there will be more suitors for the club and wouldn't necessarily rule out the "billionaire owner"?

The increased number of bidders would obviously drive up the price, but it would still be a cash cow for whoever bought it - investor group or billionaire.

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I thought MacPhail was ready to become baseball's next czar after Buddy Selig "sells his last car."

Lost of things have to happen for this to come to fruition...until then I'm more concerned with the health of Rich Hill and Sean Marshall (Cub Fever - Catch It!....ugh)

Your whole point is certainly plausible. However, if they were planning on selling, how would Hendry ever have gotten the approval to sign Pinella? He could have gotten an equally popular candidate (from fans view) for less than half the price. Also, if they are going to strip the lineup Girardi has shown an ability to make a below average team exceed expectations.

The Andy portion of your argument is pure speculation as the same could be true for any out of work baseball man. Andy is a piker compared to Reinsdorf, even in his pre Sox owning days. Remember Reinsdorf was an original partner of one of the city's largest law firms and was a principal in a real estate firm that he sold for 9 figures. The beauty of Reinsdorf is that he only had to purchase 5% of the team while using his role as the dealmaker to be declared chairman. He had proven that like Hymen Roth, he always made money for his partners. I don't think Andy has the same business acumen to collect investors nor the capital for them to look at him as an equal. If anything, he would have to be a piece of the puzzle in a deal that is being put together by a bigger fish.

I think Andy is positioning himself for the comissionership (unles W wants the job).

The Tribune is a bloated beacuarcy. They only made the decision to sell assets this past week. When Pinalla was hired, he was probably told no sale was forthcoming. Maybe the either trib empire, nbut not the Cubs alone. This changed this week.

I'm gussing Hendry has been told to scale back his plans to fine tune this team. To have big dollar veterans with long-term deals does not increase teh value of the team. Yes they will offer A-Ram a modest deal and go after the yong Japanese pitcher. No to A-Rod at short and Soriano in right.

Nothing is ruled out as McPhail is not the only possible buyer. McPhail makes his bucks as the ownership group gives him a peice of the action to run the team.

Stable revnues as fans show up regardless of victories makes it a good target to highly leverage investor groups. You could not do the same thing witht he Soxs as a few bad seasons and you back to a few thousand fans watch the KC coach get beat up.

What billionaire has the passion for the Cubs to pay $700 million? Cuban lives in Dallas. He owns the Mavs, never moving to Chicago. His passion is b-ball anyway. Cuban is better off waiting for Tom Hicks to tire of the Rangers and buy them. Less money and can drive to all the home games. Can tie in promotions and costs live Reinsdorf does with the Bulls/Soxs.

In Chicago, Sam Zell? Not interested. Wrigley? His compnay is hurting, has other headaches now. Pritiker? Family is fueding over the estate.

The most logical buyer is an investor group. The most logic head of an investor group is Andy McPhail

I understand your logic and maybe you are right.

My thought on it is if you are throwing this sale open, competing investor groups are likely to see the cash flows and risks in a similar manner. If they do, then the valuations will set the market. Since these are investments, they are not going to get sentimental in any way and will not bid dollar 1 over the net present value of the cash flows that they calculate.

However, as an investment opportunity, the same thing is available to an individual investor. He (or she), however, is not subject to justification of the offer price based on the present value of the cash flows. Even the slightest bit of sentimentality (old, storied franchise) or ego (always wanted to own a ballclub) would push their offer over the justifiable market value. An investor group would not go over this value in my opinion.

So, you may be right, maybe there is no investor out there like that. But, I'm guessing there probably is one person out there that would want the prestige of owning the Cubs. So, I'm going with the likelihood of any sale would be to an individual ego-owner. (How about Oprah, she's got bucks! )

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You know me like that.

I'd actually take Oprah as owner. She's successful at everything she does. She wouldn't put up with this shitty team. How bad is it when I'd want Oprah as owner ahead of current ownership, my god.

I hate to say it and I put rolling eyes on it for fear I'd get laughed off the board, but I'd be OK with it too. She doesn't put up with a lot failure from what I can tell. She seems to have the golden touch. But she's too smart to jump on that sinking ship.

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Dr. Noisewater, how about making an appearance at the remote tonight?

I was thinking about heading over to have a beer but wasn't sure how crowded those things get.

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You know me like that.

Alright, you have to come now. I'll be there at about 6 and stay for a couple hours. Show up and have a beer, shoot the shit. These things can get packed, but boarders take pretty good care of each other as far as getting tables and stuff.

If Oprah owned the team they would be stuck trying to maximize their cuteness and have giveaways completely unrelated to baseball....oh, wait...

Haha! Great point gd!

Not much would change on that end.

I'll definitely try to swing by. Although I'll have no idea who you guys are.

Is there some secret sign like you are all wearing jerseys from Triple Threat Sports? I'll throw on my #77 Red Grange Bears jersey.

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They'd probably have stupid celebrity drop-ins also. That would just be stupid.

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You know me like that.

Wouldn't the sale of the Cubs greatly devalue tribune's media properties -mainly WGN TV & radio???
They have long been assumed to have broadcast rights agreements well below other major market teams.

I guess I'm questioning the business wisdom of selling of the Cubs cash cow in order to save a dying business like the newspaper.
It would only seem make sense if you believe that the Cubs have maximized their value as an investment for the Trib company.

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“Mmmm. Move over, eggs. Bacon just got a new best friend - fudge.”

That's a good point and it would be difficult to determine who would be interested in the Cubs without knowing details on the broadcast rights agreements. If they are tied up with Tribune for a lengthy time, that is a huge profit center that would be unavailable for the life of the contract and those profits from the existing contract would be figured into the purchase price. Isn't one of the reasons the Yankees are so valuable because of their broadcast deal?

I think they would almost have to be able to opt out of the existing contracts but it might be hard for them to negotiate anything better than the 'GN Superstation deal they have. I don't think they really want to go with Comcast exclusively (even though they own a portion of that don't they) but maybe they would if it really would be their most profitable option. I think going that route would seriously damage their national appeal though and devalue the brand some.

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The Tribune company os a dying ship. They tried to sell the entire enterpreise and accepted bids last wee. All were rejected as too low.

Their largest owner, teh Chandler Familty Trust (19%) has seen the Trib's stock fall 50% while the stock amrket has rallied 25%. They had had it with management and demanding they do something NOW. They means sell some assets. The two assets that will fetch any value are the LA Times (David Gaffen looking like he'll be the buyer) and the Cubs.

The Tribune is operating from a position of weakness.

Foregive me for being redundent. But if Oprah buys the Cubs, she is NOT qualified to run the team. It would be over half her net worth. So, she'll want some competent to run the organization.

Know anyone here in Chicago currently without a job that has a resume that will fill this position?

I'm sorry, but it's not Andy MacPhail. We saw what happened. It didn't work. We'll have to go elsewhere.

Slam dunk....he's not in Chicago, but he recently was very publicly released from his contract and we've seen he knows how to negotiate and "show people the money"...no brainer...her buddy...

Tom Cruise.

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Simply brilliant Dr. Ken

Cub fans and scientology followers are pretty much one and the same

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“Mmmm. Move over, eggs. Bacon just got a new best friend - fudge.”