Thursday, 31 July 2014
Last updated 42 min ago
Dec 16 2011 | 4:36pm ET
A new book says that New York Mets owner Fred Wilpon sought the assistance of Major League Baseball Commissioner Bud Selig to put an end to the former's deal with Greenlight Capital founder David Einhorn.
Einhorn and the Mets agreed in May that the former would provide the latter with a $200 million loan in exchange for a piece of the team. The Mets would then have five years to repay that loan and, if they failed, would have to sell a majority stake to Einhorn.
Wilpon apparently quickly regretted the deal and sought a way out of it. One of those ways was to asked Selig to kill the provision giving Einhorn a path to majority ownership.
"Wilpon asked Selig to strike the provision requiring him to enable and assist David Einhorn in his pursuit of majority ownership, if Wilpon couldn't repay him," Howard Megdal writes in Wilpon's Folly. "The idea would be that Selig would play the bad cop. When Major League Baseball put the kibosh on Einhorn, Wilpon would have plausible deniability, and could throw up his hands and say, 'What can I do? This is how MLB works.'"
Einhorn reportedly got wind of Wilpon's discussions and angrily confronted him. Shortly afterwards, he walked away from the deal.
The Mets denied Megdal's allegations, calling them a "desperate self-promotional campaign." A baseball spokesman said that he does not believe "the account in the book is accurate." Megdal says he stands by the book.
Wilpon, his family and the Mets lost hundreds of millions of dollars in the Bernard Madoff Ponzi scheme, and could be on the hook for hundreds of millions more in the litigation stemming from that scandal. The heavily-indebted and cash-strapped team has, since the Einhorn deal collapsed, sought to sell several smaller stakes in the team to raise money, so far to no avail. It recently took a $40 million bank loan on top of $25 million in loans it has received from MLB.
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