JPMorgan Blocking Mets-Einhorn Deal

Jul 25 2011 | 1:42pm ET

A new major player has emerged in the New York Mets' effort to sell a minority stake in the team to hedge fund manager David Einhorn.

Despite reports that the deal, originally expected to be completed last month, had been held up due to unhappiness on the part of the team's current owners with the terms they had negotiated with the Greenlight Capital founder, the real problem is unhappiness on the part of JPMorgan Chase.

The New York Post reports that the bank, which is owned about $500 million by the Mets, won't sign off on the Einhorn deal. And it has the power to do so, because it has the right to approve all new loans to the Mets.

JPMorgan objects to a provision that would allow the Wilpons, the Mets' current owners, to repay Einhorn his $200 million before it repays the JPMorgan group. The bank has already expressed its unhappiness with the Mets, telling the Wilpons over the last several months that the Mets had violated the terms of their loan in 13 ways.

JPMorgan wants the loans either repaid or restructured before it will approve the Einhorn deal. Einhorn, the Post reports, wants to be paid back by 2014 to accept the terms of the loan, which include a reduction of his stake in the team to 16%. But given that the JPMorgan loan doesn't mature until June 30, 2014, he "will have to wait until later, or be part of a larger package," the tabloid's source said.

If the Wilpons are unable to repay Einhorn, who would initially take a 33% stake in the team, he would have an option to raise his stake in the team to 60% in three years, the Post reports.


In Depth

FINtech Focus: Fundbase Aims To Revolutionize Access To Hedge Funds

Jan 23 2015 | 11:03am ET

Global investment in financial technology—also known as fintech—is booming....

Lifestyle

Is Steven Cohen Going to Buy the Brooklyn Nets?

Jan 19 2015 | 6:49am ET

Rumors that Steve Cohen was interested in the Brooklyn Nets emerged after Scott...

Guest Contributor

Investors Benefit From Evolution Of Fund Of Hedge Funds Model

Jan 22 2015 | 12:27pm ET

The evolution of the fund of hedge funds model over the last few years represents...

 

Editor's Note