In a landmark move, Fred and Jeff Wilpon are selling their majority stake in the New York Mets. Hedge fund investor Steve Cohen will be the team’s new majority owner. What does that mean for the Mets, though?
Ken Rosenthal of The Athletic dropped a bombshell Wednesday afternoon. He announced the Wilpons are selling their majority stake in the New York Mets to Steve Cohen. Scott Soshnick of Bloomberg.com went into even greater depth.
Soshnick reports that the Wilpons are selling up to 80% of their shares in the team. However, Cohen’s takeover of the majority ownership will not come for five more years.
This is part of a staggered purchase of the team. Cohen will pay for his shares in stages over the next five seasons. In exchange, the Wilpons get to keep their titles for the next five years and will still own a minority share in the team after the sale.
This is both overwhelming and great news for New York Mets fans, but what does it really mean?
Who is Steve Cohen
Steve Cohen is a hedge fund investor. He opened his first company S.A.C. Capital Advisors in 1992. While CEO of S.A.C Cohen became one of the most influential people in America.
Time Magazine named Cohen 94th most influential person in the world in 2007. In 2011 Cohen was named one of the 50 most influential people in America, and the most influential money manager.
However, that all came crumbling down in 2012. On Nov. 20, 2012, Cohen was implicated for insider trading. He was never convicted, rather fined $1.8 billion and forced to shut down S.A.C. In 2016 Cohen opened up his second business venture, Point72 Ventures.
Forbes estimates that Cohen is worth $13.6 billion. That means that Cohen would be the richest owner in MLB by a large margin when the deal is finalized.
The immediate future
Nothing is expected to change within the next five years. The Mets’ have already put out a press report saying as such. Fred Wilpon will maintain his role as the CEO and controlling partner and Jeff Wilpon will maintain his role as COO.
That means the Wilpons will still have final say on all personnel decisions. That isn’t expected to change until after the 2024 season at the earliest, or after the 2025 season at the latest.
That said, it’s unlikely that Steve Cohen would not have a large say in the moves the Mets make going forward. He’s purchasing his stake at a valuation of $2.6 billion. That’s a large amount of capital to invest. That’s enough capital that Cohen would likely want to make sure his opinion is heard on every move going forward.
It’s entirely possible that the titles and their roles are the only things the Wilpons are retaining. It’s likely that those roles will diminish going forward. However, nothing is set in stone.
Nothing changes, for now; everything will stay the same for the next five years—at least in regards to titles and legal ownership.
Five years from now
When Cohen finally does take majority ownership, he has a few routes he could take.
One of them is the possibility that Cohen decides while he wants to become majority owner, but doesn’t want to be the controlling owner.
This isn’t that uncommon in the MLB. For example, the Miami Marlins majority owner is Bruce Sherman, but Derek Jeter is the controlling owner. Meaning, while Jeter doesn’t own majority share, he’s the one who makes the personnel decision. If that happens, it’s possible that the Wilpons get to keep their controlling power.
However, this is very unlikely. Cohen was already a minority owner of the team. If he was making this move strictly for financial purposes he would have purchased more minority stakes. Instead, he purchased a large majority stake.
Cohen also tried to by the Dodgers a few years back; he was the runner-up in what turned into a crazy bidding war.
That likely means that Cohen is buying the majority stake because he would like personnel control. Early reports suggest that’s a good thing.
A person who is friends with the Mets' new perspective owner in five years, Steve Cohen, says Cohen "will play the game at the highest level" in regards to spending on players.
— Mike Puma (@NYPost_Mets) December 4, 2019
For now, it looks like Cohen plans to spend big money. Cohen seems to be planning to return the Mets to their glory days of spending. Prior to the Bernie Madoff scandal, the Mets were often a top three-five team in spending. Now, they rarely, if ever, crack the top 10.
Expect Cohen to change that when he takes control. The Mets will likely be spending like the big market team they are once again.