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.