Boston Red Sox: 5 Reasons the Owners Should Sell the Team
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With the Fox Business Channel reporting Thursday that the Boston Red Sox might be for sale, fans are for the first time in a decade wondering about the owners’ commitment to the team. While the controversy of the last year has certainly tested fans’ patience, few thought that a move this drastic might even be possible.
Principal owner John Henry issued a terse, 73-word statement to the Boston Globe’s Peter Abraham, stating that:
A sale of any kind is so far from our thinking it hasn't even come up apart from technical planning issues involving death or disability. This report is completely without foundation.
Regarding unnamed sources: Any sale discussions that may have taken place were missing three key people — Larry [Lucchino], Tom [Werner] and me. The Sox and any of the other components of FSG are not for sale and will not be for the foreseeable future.
While Henry may not be considering selling the team, perhaps he should be. Here are five reasons why now is an ideal time for the Sox to be sold:
LA Dodgers Sale
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When the Dodgers were sold for $2.15 billion this past May, a new standard was set for the value of a professional sports team. Originally valued by Forbes for $1.4 billion in March, the team ended up fetching some 154% of its estimated worth.
If that same pattern were to hold in a potential sale of the Sox, Henry and co. would fetch $1.54 billion for the team after they were valued at an even $1 billion in the same Forbes survey.
That’s a lot of money, especially since the Sox were purchased for $700 million in January of 2002.
A potential 220% return on a 10-year investment would be a huge win for Henry, a shrewd investor whose success in the futures market is what allowed him to buy the Sox in the first place.
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The Sox, unlike almost every other MLB team, have nearly complete control over their own network. Only the Mets and Yankees possess team-owned stations which allow them to essentially deposit all advertising revenue directly into the owners’ pocket.
In addition to the team, Henry received an 80% ownership of NESN in the 2002 sale, so he would be able to flip that substantial asset to the next owner.
Having an established TV network already in place would be a hugely enticing piece for a potential buyer, and would likely drive up the price. The ability to add new programming to NESN, which is largely Sox-centric, also presents a potentially lucrative opportunity for a new owner.
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The Sox stink this year.
And they’re probably going to stink next year.
And there was the whole “fried chicken and beer” thing last year.
Which came after one of the biggest collapses in MLB history.
All this adds up to one inescapable truth: This team is not very popular right now. People in Boston are far more interested in the Patriots than the Sox, and (if there is a season) the Bruins have seen a huge boost in their fan presence as well that will undoubtedly continue to grow.
For Henry, the time is right to get out. He himself is viewed as uninvolved and uninterested by most fans, and salvaging the owners’ image will take time and effort that he may be unwilling to give.
Red Sox Brand
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After winning championships in 2004 and 2007, the Sox organization shed the label of “cursed” and began to take on a role as something of a juggernaut along the same lines as the Yankees. While the team has always maintained a top-five payroll, before they won nobody seemed to notice.
Now, though, the “lovable loser” identity has vanished. Instead, they are perceived as a team replete with spoiled veterans and underachievers. While strides have been made to rid the team of this perception (good luck in LA Josh Beckett, Adrian Gonzalez and Carl Crawford), it is a long-term project that may not see immediate returns.
The ownership is part of the problem, though. Regardless of their involvement (or lack thereof) in the erosion of the winning tradition, the longer they stay the more damage is done to the team’s value.
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Since purchasing Liverpool FC in October of 2010 for $477 million, Henry has grown increasingly more interested in the goings on of the storied club. While any owner should be hands-on with his team, Henry has grown involved with his new toy to the detriment of the Sox.
It would be naïve to suggest that all the turmoil surrounding this franchise over the last year would have happened regardless of ownership’s involvement. Henry is in charge of the franchise, and as an absentee owner he allowed his employees to run amok.
While Liverpool has had its fair share of troubles under Henry’s stewardship, the reality is that he simply doesn’t have the time to fully devote himself to both teams.
Based on his actions in the last two years, Henry has made his choice.