New Member of Phillies ownership group

[Philsmania]

Technically and legally, the Phillies have had the same non-family ownership since 1981. However, I believe it's composition and membership has now had 100% turnover and not a single original member of that ownership remains in the group with the elder Buck's passing. The others have all either sold their shares or died off with their estates selling their shares to the remaining owners, namely the Middletons who bought in during the '90's.

[zambonir]

Amazing the original Giles group bought it for $30 million in 1981.

Also pretty amazing to me that Gillick got himself such a sweet deal when he took what was essentially a temp job - and one he did very, very poorly given he also essentially picked his disastrous successor (to say nothing of his role in hiring Almaraz and the 2015 and 2016 drafts).

Herb Middleton came in in 1993, yeah. But obviously the partnership is still structured so that no one can hold a majority. Otherwise I'm sure Middleton would have liked to buy it. But his power is unaffected.

[Philsmania]

Amazing the original Giles group bought it for $30 million in 1981.

Also pretty amazing to me that Gillick got himself such a sweet deal when he took what was essentially a temp job - and one he did very, very poorly given he also essentially picked his disastrous successor (to say nothing of his role in hiring Almaraz and the 2015 and 2016 drafts).

Herb Middleton came in in 1993, yeah. But obviously the partnership is still structured so that no one can hold a majority. Otherwise I'm sure Middleton would have liked to buy it. But his power is unaffected.

I'm surprised that the Montgomery family still has a share since the other deceased owners generally didn't pass their shares on to their families. Middleton's fondness for Dave making him let them keep their 1%?

[zambonir]

Well, Middleton and the Bucks both inherited their original shares. And I think this deal is happening because the Bucks want the $, not because they couldn't themselves keep or buy it.

But in Monty's case of course he never actually bought in, it was given to him. And even Giles sold every last cent (because he needed the money)!

Doubt fondness has anything to do with, the rules of the limited partnership are probably clear

[bkox]

The Phillies' search for a new partner began last summer. It led them to Stanley Middleman, who tried to buy a stake in the Guardians and then the Nationals. Middleton wanted someone who went along with the club's spending: https://t.co/Q3KzeqVXf7 pic.twitter.com/wDA6oUW3X7

— Matt Gelb ( @MattGelb ) June 6, 2023

[Fur_Coat]

https://www.justice.gov/opa/pr/freedom-mortgage-corporation-agrees-pay-113-million-resolve-alleged-false-claims-act#:~:text=Freedom%20Mortgage%20Corporation%20has%20agreed,)%20Federal%20Housing%20Administration%20(FHA)

This is the new partner

[Philsmania]

[quote="bkox, post:8, topic:53346, full:true"]

The Phillies' search for a new partner began last summer. It led them to Stanley Middleman, who tried to buy a stake in the Guardians and then the Nationals. Middleton wanted someone who went along with the club's spending: https://t.co/Q3KzeqVXf7 pic.twitter.com/wDA6oUW3X7

— Matt Gelb ( @MattGelb ) June 6, 2023

[/quote]

Hot dang!

Let's hope his money is clean, in light of Fur Coat's post.

[bkox]

This is the new partner

This doesnt bother me. Was 7 years ago. Seems to be fine since. I mean.. should we be upset that John Middleton's money came from selling tobacco products that probably led to lots of people getting cancer and other lung ailments. Trea Turner's contract is partly paid on the deaths of people who smoked the Middleton family products.

[zambonir]

Well, yes, we should be upset, but we'd have to stop watching sports completely if we wanted owners we could actually respect or needed them to be highly ethical people, even if there are a few.

Can't imagine this is something MLB doesn't approve; if his interest in the Guardians or Nats had been stymied by that specifically surely this wouldn't be in play.

[Fur_Coat]

I get your point about Middleton but why would they want this guy as a partner when they shouldn’t need his money. I’m not buying that without him they would slash the payroll $75 million.

[zambonir]

I'm sure he's not the only one they could have brought in but that doesn't mean the other candidates would have been any more perfect (the Sixers' ownership, for instance, was built entirely on the wreckage of Michael Milliken's bankruptcy).

Nor would they have had to slash the payroll or had actual trouble paying debt service or for future projects like the Clearwater stuff. But Middleton didn't want to take on that extra slice of the team himself (which also would have required dissolving the limited partnership) and neither did the two younger Bucks.

The implication - that ownership right now means putting in more money, not just reaping greater profits - is interesting. But even if that's true, nobody's actually hurting, and they are making more money just from the team appreciating (and, hopefully more success/attendance in the coming years) anyway.

[schillingfan]

Rich people are rich for a reason. As long as there are owners, I want my tam’s owner to be more concerned with winning than making money. Go forth and spend you rich Middles.

[julio]

I get your point about Middleton but why would they want this guy as a partner when they shouldn’t need his money. I’m not buying that without him they would slash the payroll $75 million.

Obviously, I don’t know, but it appears that Tri-Play (the Bucks) may have wanted to reduce their holding in the Phillies (i.e., wanted to move some of their money elsewhere), as, based on the reported ownership shares, this is a straight sale of a portion of the Tri-Play shares to Middleman.

Given that Middleton appears to have been looking for an additional limited partner since last year, we might infer that Tri-Play has wanted to get some money out for some time…and under the terms of the partnership, Middleton couldn’t just buy them out, because the partnership doesn’t permit any single entity to hold a majority stake.

By the way, long time no see, Fur_Coat!

[zambonir]

It seems to be linked to the death of Bill Buck in March though. He had three daughters and no sons and I'm presuming they were not interested in inheriting (or, if that's not allowed, buying) his shares (not that the gender part matters per se). Unlike Jim Buck and Peter Buck, the sons of J. Mahlon and Alexander, who did. But were not able or willing to buy their uncle's portion. And they didn't have to wait for his actual death to be thinking about this.

On top of that, the failure of the team to announce his death, let alone honor him on the jerseys, suggests some sort of distance with that side of the family (but who knows. Maybe it is still coming).

The Athletic article says that Middleton could have made his play for the shares and moved to dissolve the partnership if he'd wanted to. I don't know if he could have done that easily or if the others could have blocked it but presumably Gillick and Monty's estate would have voted for him even if the Bucks had been opposed. I don't think it's that fraught though.

[julio]

That makes sense, z, given that Tri-Play sold about a third of its stake. If the Bill Buck share of the partnership wanted out (wanted the money for something else), that's the share that would have to be sold.

[fish]

Doesn’t seem coincidental that the last two times the franchise sold a stake was after World Series seasons- someone sold high.

[zambonir]

Well, stakes in the partnership have changed hands numerous times, incrementally, between 1994 and now. The overlap with on-field success certainly couldn't have hurt but Middleton selling his company in 2007 was probably a bigger factor than the team's success at the time. He could have bought the entire team if it was possible. Plus, people died. I think Middleton made several of his final moves at the beginning of the fallow years (i.e. 2014-2016). Giles also sold his stake off piecemeal over the years.

Truth is a 62-100 Phillies team last year would still be worth a lot more than than the 2009 Phillies, and probably not much more or less than the current NL champions.

[andyb]

Article seems like they wanted a little more cash flow before they do their Clearwater complex upgrade and later do some more CBP upgrades. In Middleton's shoes it might also be nice to spread the risk around for a few years when the RSN revenue drops. The Phillies' profit sharing probably means they are clearing a bit less in rights fees now. The future of the NBC sports channels is also uncertain. In DC the owner of the Wizards and Caps bought the channel and the rights back. Assume the Phillies will probably do something similar to get their rights back if the fees keep going down.

All is good when you draw 3 million fans. The future is probably murkier.

The Phillies sold 16% of the team: What it means for owner John Middleton, the...

[Purduke]

Sale puts the franchise value at $2.46B; Forbes estimated $2.58B in March. Not a bad estimate considering we have had a 500 bp jump in rates the last year and are coming off double digit inflation. Guess it helps that Phils have another 15 years or so on the TV deal.

[fish]

It is just the Buck family that is getting paid from selling shares, right? The reading between the lines makes it sound as if the Phillies as an ownership group sold some equity to bring in cash.

Or is the expectation that the new partner is going to bring in more cash after the purchase price?