With all the support and encouragement I got to buy the team, I think its appropriate to share the decision making process behind what happened and why. Buying the Cubs was a unique opportunity to own one of the most storied franchises in sports. Its a team that represents so much to so many, with such a unique legacy, that when the opportunity arose, I decided to go for it.
I’m not going to get into the numbers, or the people, or much of the process other than to say that the person I worked with at the Trib was great. The person I worked with at the Cubs did a great job as well. Nothing about the process was anything but positive when it came to the people assigned to work with me.
During the entire process I thought I had a very strong chance of being able to buy the team. I thought I could offer a competitive price. I thought I had the experience to come in and improve the business so that I could continue to invest in the product on the field without having to squeeze every nickel from Cubs fans. I also thought I could win over Major League Baseball. All told, I thought my experience in owning a team and most importantly, my commitment to always trying to win, would give me an important advantage.
From my perspective, the Cubs being a winning team was important to the seller, the Tribune company, even after they sold. When the Cubs won, the newspaper sold more copies, more people watched the games on WGN and listened on the radio, which in turn meant those mediums could sell more advertising at a higher rate. On the flipside, if the new owner was purely about making money at the expense of a winning team, it could cause the value of the seller’s other assets to decline faster than they otherwise would. Not that this would compensate for significant delta in ds;rd price, but it could break ties.
On the flipside, my dedication to winning could also make my job of getting approval with MLB baseball much harder. Some people thought it meant that I would spend on players like I did in my early days with the Mavericks. Back before I learned that sometimes GMs put keeping their jobs ahead of trying to win championships. But thats another story for another time. I had no intentions of trying to outspend the Yankees or Red Sox. There was no reason to. I didnt have to beat either of those teams unless I made it to the World Series. The only teams I had to be better than were those in the National League, and more importantly, those in my division. There were no big spending rivals close to home, so the AL East could spend themselves silly. My plans were to spend to win, not to spend for spending’s sake. IMHO, the money I could save being in the 2nd tier of payroll could be invested in scouting and development. I made this clear to any and all of the owners that I spoke to across the league. Of course that didnt stop some from trying to convince some owners otherwise.
In particular, a lot of the “intelligence” that I would be a big time spender seemed to come out of Chicago. The “conventional wisdom” of people that I talked to around the league suggested that Jerry Reinsdorf, the owner of the White Sox was going to be my primary obstacle to getting approval from MLB should I buy the Cubs. Contrary to popular belief, I think I have a good relationship with Jerry. I know I have a good relationship with all the people I deal with at the Bulls. We are probably on the same side of NBA issues 99pct of the time. I honestly don’t know what if any information was coming from Jerry, or his position on my owning a team. He was very cordial to me and made it clear that he would be happy to talk to me about anything at any time, although we never did get the chance to chat.
My sense of the entire situation was that whoever the new owner of the Cubs would be, it was in the Sox best interest for things to stay business as usual. Published TV ratings and other published measures showed that the Cubs were more popular than the Sox, yet before I even started looking at the Cubs, I knew from my discussions with people in the NBA that the Cubs and Sox were treated as equals in their business dealings. That was great for the Sox, not so good for the Cubs. Im guessing the people in the Sox organization knew, that if I bought the team, particularly at the price point that was being suggested in the papers, there was no way I would just accept parity in future business dealings. I was going to have to try to negotiate the very best deals possible for the Cubs, even if it was at the expense of the White Sox.
In my conversations with owners around the league, they seemed to understand this point. But what was most interesting to me, was that a recurring theme was that they thought I would be good for baseball. Many had talked to NBA owners who explained that I did my homework and was a good partner. That in my areas of strength, in particular technology, I would make sure I tried to contribute and help the league how and where I could. It was pretty obvious that more than a few of the owners hoped I would come in and stir things up and stand up and speak for the owners when it came to digital rights and the future of technology and how it would impact the teams and leagues profitability. They were hoping I would be the new guy to come in and take the commissioners’ arrows. Which of course I would be fine with and happy to do if it got me their confirmation vote.
The obstacles seemed to be minor, the opportunity with the Cubs significant. It really was an opportunity that I thought I could be successful with on the field, and financially. More importantly, its something I could have a blast with. The Cubs had a strong organization, with strong management, so if I could do a deal, it wouldnt require changing the entire organization or culture like I had to with the Mavs. I felt I would have to tweak some things, but it was all manageable, which made me feel good that I could stay commited to the Mavs and lock in with the Cubs .
The hardest part was going to be the financial deal. I never thought it conceivable that it would be hard to spend a billion dollars on a sports team. In this case it was. Add me to the list of people who never want to participate in this type of sales process again. I tried every trick I knew to try to get them to commit to me. It reminded me of when I was 16 and selling magazines door to door “Do you mean to tell me Mrs Doe, that when you tell your husband that you spent 75 cents per day on the education and enjoyment of your family, he is going to get mad ? Of course not, he will be proud and excited for you and your family”. You name the trial close, I went for it. But I couldnt close them.
Then the credit crisis hit and hit hard.
All of the sudden, what seemed like a sane business decision, didnt seem so sane any longer. In particular, the financial participations I had been discussing with my bankers were for shorter term loans. Just refinance at the end of the term. Its what everyone is doing. Except that it no longer seemed like a safe bet that I could refinance in a few years. I didnt want to be caught with a Sumner Redstone margin call, and for better or worse, the banks were getting worried about staying in business and the idea of matching the asset to the term wasnt something they were ready to do, unless of course they could convince 30 other banks to do the same thing. I thought about writing to Congress to get a bailout…just kidding.
With the credit market on the fritz, the other option was to add investors and just pay cash. However, if we were going to pay cash, I was not going to bid anywhere near 1 Billion dollars for the assets. Once the credit crisis hit, the value of cash went through the roof. It was not just a matter of how much the Cubs were worth, it was also a matter of how much more money I could earn with that cash. Cash was and is king. Distressed investment opportunities were rolling in the door that could make me multiples of what any sports team could. I could not see any scenario where the Cubs were worth anywhere near the numbers that had been discussed in the media. There is one publicly owned team, the Atlanta Braves, that are owned by Liberty Capital. The market cap of ALL of Liberty Capital net of cash and debt got as low as $250mm dollars, and today trades for about $500mm dollars, and they own far more than just the Braves.
So there was the issue of valuation. There was also the issue of the economy. It was impossible to predict the full impact of these tough times on any sports team. That uncertainty created two issues. The first of course was valuation. How much would I be willing to pay for the team ? I wasn’t sure. More important to me was the cash flow. If the economy had a significant impact on future revenues, it would also impact how much I could invest in players. The absolute last position i wanted to be in was paying so much for the team, that if revenues fell off, I couldnt play to win.
So when it came down to it, I did what I thought was the only smart thing to do. I asked for an extension. I knew that if they got the money they wanted for the team, well my bid was not going to be high enough anyway. If they didnt, or the other bidders couldnt come up with their money, they would come back to me.
I’m still waiting
121 thoughts on “The Cubs”
Pingback: Mark Cuban Speaks up About Cubs Deal « MySportsScoop.com
We really can’t thank you enough, Mark, for this candid, open discussion of the process. Obviously so many of us would have loved to see you at the helm of the Cubs, but we understand that sometimes things just don’t work out.
Comment by Wrigley Rooftop Fan -
PLEASE keep trying to buy an interest in the Pirates. As a native of Pittsburgh as well, it is a disgrace to have the Pirates fall on their face every year. The Pirates NEED to be contenders – they need your support and passion for winning. As you know, Pittsburgh is a hard core sports town and would have amazing support if they could be playoff contenders. After an amazing year with the Steelers winning the Super Bowl and the Pens making it to the Stanley Cup last season – the Pirates need your support to make the city of Pittsburgh the City of Champions once again!!!
Comment by Ray -
Hi mr. Cuban,
I am a huge Cubs fan and I am losing my house of 22 years so as much as I would love t save it I cant and I was wondering if there was any job I could do for you at home to raise the $10,000 I need to save my hme? Long shot but you are the only one worth talking to wi
Comment by Phyllis -
Just wanted to let you know that we have a paper about you as part of our MBA class Transforming Organizations.
I found very interesting to watch all the videos and articles covering your life and I really think there is a lot to learn from you and about the attitude that has put you where you are.
My sincerely admiration and best wishes!
Comment by Gabriela -
That sucks you would have been a great owner…….you bring even more excitement to sports.
Comment by Rick Glaser -
I am a diehard Mavericks fan. Have been ever since they came to Big D. I was at Mopody Coliseum when we beat Seattle in Game Five.
Then sat through the most difficult time in any pro sport and remained diehard.
I am now in your old stomping grounds, Bloomington with my company. If you have a bit, come back down when y’all are in Indy and I will buy you a beer.
Comment by Mickey Tindel -
It seems to me that you always make the right decissions, your track recored speaks for itself. I feel B-Ball would profit from having a personality like yourself owning a team. It seems to me that with newspapers struggling like they are and the economy where it is, your waiting might bring you a better deal than what was originally on the table.
I can’t help but read a bit more into your comments on being able to do more with your money right now than owning a team. I would appreciate the opportunity to send you a few minnesota companies I think you will find interesting, right up your alley in regard to Communications and TV.
On a different note, how badly do you feel the attendances are going to be affected by the economy, and what is your team doing to entice new fans to buy tickets to see the Mavs?
Comment by MIchael Collins -
Mark, the thinking among Cub fans is that you were our #1 choice. Tom Ricketts being our other choice. What we’ve all been terrified of, is a faceless corporate entity, hell-bent on keeping spending down and prices up, without a care for winning.
I’m sure you’re aware, if it were up to fans, you’d already be working the Jake Peavy deal with Hendry. Baseball’s Antitrust exemption needs to go, or at least be revised.
Good luck to you
Comment by Jeff S -
I would have been so happy to have Mark Cuban as the Cubs new owner,
like most other Cub fans. Good luck with the Mavs this year!
Comment by JakeM -
Now that the Cubs are off the radar–how about chasing down the
in-state team, the Houston Astros??
There is an on-line petition in its infancy to try and get this done.
The link for it is at:
Please sign it and send it to all you know!!
Comment by Dylan Sides -
MARK – I super-admire your willingness to “share” as much as you do with your community. I KNOW that you will get a huge kick out of GoldMail…just hit the URL below for a quick GoldMail I just made for you. 50 seconds. (Don’t worry – we’re the real deal (Former CTO of PayPal is our CTO)
Comment by David SImpson -
Just buy the KC Royals and torture Jerry for the next 20 years buy beating his sox into the basement.
Comment by Mark -
With the annoucement of Kevin McClatchy selling his last shares of the Pirates and is off the board, maybe you could purchase his shares. God only knows we need somebody to step up and end 16 years of futility. How much longer do we have to put up with this insanity called rebuilding?
Comment by Scott M -
Hey Mark. I dont know anything about big business deals but I know EVERYBODY “highballs” individuals with thier price of and item. If it sticks, Hurray, if it does not,either negotiate or go on to the next individual. I had no idea buying the Cubs was like getting a membership at Augusta National. The good ole’ boys let in who the want. More power to them too. But on the high side of not being able to buy the team if that is truly the case,screw em. Thier loss not having some one of this century to advance thier cause. A lighter note too. I think it was Groucho Marx that said ” Any club that wants me as a member, I dont want to belong to” I was going to actually fly to the great windy city if you bought them. No bs. To go to the first game. That won’t be happening now either. Bummer, Big Bummer. Thanks for the thoughts.
Comment by Frankie from Lawnside -
That would be very American of you Mark to buy the Cubs. Good luck with that. In the meantime, can you please help the earthquake victims in Costa Rica by throwing us a bone? Please visit http://www.causes.com/costaricaearthquake
Costa Rica (who has a lot of Cubs fans FYI) needs your support.
Thanks and continued success!
Comment by Zahara Mossman -
buy the braves and put them back on TBS
Comment by luke -
The Cubs suse could have used the help.But You have, apparently, the same problem as every one elsein america…cash flow.Keep up the good maverick-ing.
Comment by MaverickGuy -
You’re a fantastic owner. If the Cubs don’t work out… PLEASE BUY THE RANGERS!!! Unlike Hicks, I know you’ll do what it takes to win. Hint: All you’d have to do is bring in pitching!
Comment by Chad -
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good luck, Mark. and i would be interested in hearing your thoughts on big spending for free agents, ticket prices, and how to get butts in seats when everyone else, it seems, is going into the poor house. i’m not attacking you at all, but i think it’s a good question. i can still afford the $15 cheap seats at Camden Yards (and even better seats), but i make good money and the O’s aren’t spending $160 mil on CC Sabathia.
Comment by scott -
So it isn’t about the money it’s about being in a position to win. To win you have to have the money to buy the players that put you in the position to win. So it isn’t about the money. This was an ah-ha moment.
Comment by Gators National Champs -
You’re a winner even if you haven’t won the Cubs over, yet.
No Cubs, no cry – everything’s gonna be all right!
Comment by Diana -
john in geneva it’s people like you that keep stiring the pot for these people, what has cuban done other than have a passion for sports as the comminsioner sits on his high horse and does what he wants, you need to learn to think for yourself rather than listen to what some puppet puts out there for you to hear!
Comment by jim h -
that is the problem in this country the laws are only for a choosen few, i guess it’s all right for the comminssioner and major leauge to discrimanate against you because of who they think they are,give baseball back to the people it’s our game not mlb’s, all this shows me is that their are a few greedy little men making a lot of money and they want to keep it that way.watch and see how long it takes them to aprove the padres deal and that show you just how dirty mlb and the comminssinor really are they don’t have the right to keep you out this is still america.
Comment by jim h -
Buy the New York Time’s stake in New England Sports Ventures LLC. “NYTCo is the second-largest shareholder in the holding company, which owns the Boston Red Sox, Fenway Park and 80 percent of New England Sports Network”
1. You’ll own a piece of the Red Sox
2. You’ll own a piece of Fenway Park (better than Wrigley)
3. You’ll own a piece of NESN (we know you like your TV)
All at a fraction of the Cubs price.
Comment by RAW -
Hey, sorry to hear it didnt happen. All things work out for the best eventually.
Comment by Mumbai -
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Hi Mark, as a lifelong Cubs fan I’m disappointed that you won’t be our new owner. As a big NBA fan as well, I know what great things you’ve done with the Mavs and you should be commended on that. I just hope our new owner(s) are as committed and passionate as you are with the Mavs. Thanks for trying and please by all means don’t be a stranger, you’re always welcome at Wrigley and especially in the bleachers.
Comment by Jim -
Mark Cuban–I hope you get the Cubs man! You would do wonders for MLB!!!!
Comment by Mark Madsen -
Pingback: The difference between Mark Cuban and a real businessman « Sly Capital
Only one Chicago Cubs. World Series with the Cubs would be greater then an nba championship with the mavs. You should do what is humanly possible to make it happen.
Comment by Straight Cash Homey -
Thank you for the update. I heard a couple of days ago on the news that you were not among the leading contenders. I hoped I had not heard that correctly.
The Cubs and Chicago’s (actually the whole world) love for them is a great part of living in Chicago. I could not wait until you brought your enthusiasm to the team to take it to an even higher high. I hope this is not the end of this story.
I am a fan of your enthusiasm, politics, dancing, and your way with words.
Comment by Mary Steinberg -
On behalf of all us Wrigleyvillers, you would of never had to worry about the NL Cenral. We’re so popular, we could go 100 years without winning anything and we’d still flock to the park everyday, ok bad example. Point is, we don’t care about winning, just being #1 in popularity will make you always #1 in our hearts!
Comment by Chad -
I truly wish you were the owner of the Cubs; having a one unique and informed voice behind this franchise would have been the best start towards a successful World Series bid.
Comment by Joe Tate -
Screw the Cubs, buy a piece of the Red Sox (or New England Sports Ventures LLC,)
Then you can:
1. Own a piece of the Red Sox
2. Own a piece of Fenway park
3. Own a piece of NESN
Comment by Rick -
Have you considered buying the Royals instead? You could probably
get them for a song. The KC fans are great baseball fans and
are severely pissed off by ownership’s lack of interest. Hire me to
be the GM and we’ll be the next Oakland. Then in 10 years move the
franchise to the technology triangle in N.C. Talk about a return.
Best of luck.
Comment by R. McCabe -
I’ll keep my fingers crossed that it will somehow work out between cubs and you – I remember what a infusion of energy you were to the mavs, and I know you’d do the same here. but, it is the cubs, and they are always breaking my heart…
Comment by chicagolonghorn -
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Mark, god bless ya! Everytime i read something you write I learn a grat deal. IF you really wan tot spend your money wisely come back to the Channel and buy a solution provider! We could use your enthusiasm and color back here..–your buddies at CRN, VARBusiess, et al.
Comment by Robert DeMarzo -
I think it is amazing that you can’t buy the Cubs. I think baseball does not want your complaining way or your childish behavior. Yea Baseball!
Comment by Sharon Parker -
Thanks for sharing your experience. Your analysis on Reinsdorf may
be spot on but I believe it runs much deeper than that. MLB has been
a “Good Old Boy” network, kind of like Augusta National, for quite some
time. With the current economic collapse at hand, it may shake things
up a bit, and the price will come down along with everything else that
is over-valued. Hold on sixteen and make the dealer play his hand.
Comment by John Geneva, IL -
Mark, thanks for the update. I’m hoping to take advantage of your post today by telling you that I have a business idea very similiar to owning the Cubs that would further solidify you as a legend (and even somehwhat get back at the baseball owners).
To strike your interest without giving away my idea online, let’s just say that even though none of these things are involved it would have the energy of Wrigleyville and Las Vegas combined, the fun and excitement of a whiffle ball game, and the heart of a father having a catch with his son… and I believe that it would be more profitable than owning the Cubs.
Comment by Alemextra -
It’s awesome to hear that a giant like you is actually sounds almost heartbroken by this for lack of better words. You seem to be really upset that something like this happened which is great. Let me explain that. It’s nice to see a business man who is worth more money than every single person posting on this website together, get upset about something like this. You still have feelings and aren’t a jaded dbag business man. I can honestly say I don’t know much about you, but I know that based on this post alone, you would have made an excellent Cubs owner and as a Chicago person, I hope Zell gets his head on straight and works it out for you and realizes that you would be the best move for the Cubs this season and for many seasons to come.
Good luck Mark,
Comment by Ryan -
Thank you for the explanation. I always thought the Cub’s should go to
you and i hope they still do. I never blog but this is one subject
that is important to me and i wish they would just sell it to you
already!! I think the whole city wants you to be the owner.
So this blog is just to wish you well and to say, “hang in there”
especially when you’re doing business with Chicago, we don’t do anything
by “the book” if you haven’t figured that out yet!!!!!
Good luck and GO CUBS!!
Comment by Joanie -
thanks for the update mark. if it’s meant to be, it will work out. I’m sure Sam would love to sell the team to a winner; and that’s you!
happy new year
Comment by etavitom -
I’m sure it’s too late for this deal, but with a high profile team like the Cubs couldn’t someone put together an IPO and sell shares of the team to recoup the investment? I know I would buy shares for myself and my kids to own a part of my favorite team.
Comment by Kevin Kelley -
I am not surprised that bid to buy the Cubs was rejected because the MLB is run is a joke. Clearly they should be stripped of their anti-trust exemption. You would be the only person who could actually turn around the biggest losers in all of sport – that being said as a White Sox fan I am glad that you have been unsuccessful in buying the Cubs. Any interest in the White Sox?
I do hope that have opportunity to buy anothe club and turn them around – if for no other reason just to watch the Cubs fans make excuses and cry – the only thing that they are truly good at.
Comment by Matt -
Awesome post. I was definitely wondering what was happening behind closed doors. It seems as though buying a major sports team is a lot more confusing than I originally thought…
Comment by Jacob -
Thank you for taking the time to explain this to all of us who wanted you to buy the team. As a long time Cub fan I wanted an owner with three things:
1. An individual who takes responsibility, not a committee
2. Commitment to put a winner on the field.
3. Resources to do #2 and make those necessary moves to get over the top.
After looking over those who appear to remain standing, you still are #1 on my list. What a crying shame that the egos of the old farts in MLB stand in the way.
Hopefully Zell is smart enough to take them on and they hear from you.
Comment by Dennis Miller -
Nick, I thought ESPN (not NYT) owned the Boston Red Sox? My bad! 😀
Mr Cuban, have you thought about owning an NFL Franchise?
If so, talk to Al Davis about the Raiders (PLEASE DEAR GOD, PLEASE!). 😀
Comment by Nate -
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Please buy the jets.
Comment by jonathan -
I don’t understand why the other owners or the commish would not want you in baseball. I think you would only do good things for the game. I know that most Cubs fans want you to be the new owner. I can’t blame you for not wanting to make such an investment in these times. I hope you don’t give up on the Cubs or owning another baseball team. Good luck in future MLB dealings. Hope we see you in Chicago real soon. Thanks for giving Cubs fans an insight on this process and your dealings.
Comment by Chris Mulligan -
…tongue firmly planted in cheek…
Don’t you feel the slightest urge to don the corporate raider cloak?
LBO the whole Tribune mess before it shows up on the court house steps?
Sell off everything but the team and the field?
Paying for the real prize – or better – along the way?
KKR / RJR – II, the sequel.
Nah, too much paperwork.
Comment by Cary -
To that brewer fan kiss my ass and get a life ! Just think it will be another
18 years before you play in October LOSERS!
Comment by iggy from vegas -
Mark, thanks for the update. I’m hoping to take advantage of your post today by telling you that I have a business idea very similiar to owning the Cubs that would further solidify you as a legend (and even somehwhat get back at the baseball owners). To strike your interest without giving away my idea online, let’s just say that even though none of these things are involved it would have the energy of Wrigleyville and Las Vegas combined, the fun and excitement of a whiffle ball game, and the heart of a father having a catch with his son… and I believe that it would be more profitable than owning the Cubs. I’ve been trying to find out how to contact you, but have had no luck. I know that leaving a comment on your blog might not be the best way, but I’m taking a shot. Anyway, good luck in all your future dealings and KEEP THE PASSION!
Comment by Thurman -
Interesting entry today. I never knew both Chicago teams were to be considered equal in business dealings. I just have to wonder how and why that came about.
Comment by David -
Pingback: Mark Cuban talks about the Cubs - Baseball Forum - MLB Forum - Fantasy & College Baseball Forums
Mark – Please buy the Pirates.
Comment by Teri -
Wrigley is highly overrated anyways. It kinda smells funny and isn’t nearly as good of a place to watch a game. Yeah, the after game party is nice.. but the Wrigley experience is a bit overrated when you’re just talking about what goes on at the park.
Comment by murph -
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The nice thing about owning the Cubs is that you’d never have to make any improvements. The fans will love the team no matter how crappy they are.
Comment by Atwater Village Newbie -
Your due diligence pointed you in the right direction. At this point in time, that price tag combined with a very nebulous return outlook is a death trap (setting all personal enthusiasm for the opportunity aside). Madoff fund investors can learn a lot from your investment process…
Comment by Matt -
Gee Mark, had you and Mr. Hardy and Mr. Greenberg all combined forces at the end of 2006 like was proposed to you, I’d bet a dime to a dollar you would be an MLB owner to-day. But you know Mark, even though you might have had a lot of good times in the bleachers at Wrigley, you would have never been appreciated as much as you would had you come home. But while it seems you have given up on us, we haven’t given up on you and believe, one day, your roots will nourish you with the passion you ultimately want.
In Pittsburgh. Go Bucs!
Comment by BurghBro -
No rooting interest in the Cubs, but I hope this still happens. Also, I think Mark would win in a fight with a choo-choo train.
Comment by Brian -
My name is Anthony Gayton. I have been a cubs fan for as long as I can remember. I’m hoping you actually bid on my favorite team. If there is anything we cub fans can do to promote or endorse you, please let me know. My dad said I shouldnt, but here’s my email adress: firstname.lastname@example.org— I doubt you would, but if you would actually email me, i would really
respond to me, letting me know if there’s anything we cub fans can do to increase your chances, let me know. that would make me a happy 14 year old boy. I swear, and know if you buy the cubs, you WILL win us a world series. There is not a better fan base than the Chicago Cubs. Good luck, and i’ll look forward to checking my email frequently.
Comment by Anthony -
If this Cubs thing doesn’t work out, would you PLEASE buy the Rangers? Please?
Comment by HAB -
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Mark, so you don’t feel you were used by Mr. Zell simply to help drive up the price of the Cubs? I know you went out of your way not to indicate any displeasure with the team or the process, but I can’t help but believe that you must be a little irritated at being used like that, especially when you had no chance from the outset. Which is too bad, because I feel you would have made a great owner of the Cubs.
One claification: when stating your position about future business dealings with the White Sox “even if it was at the expense of the White Sox”, were you referring specifically to TV revenue between Comcast & WGN being equal currently?
As for your rep as a spending maverick, I guess first impressions are difficult to overcome.
Thanks for your insights.
Comment by Bob -
What Mr. Cuban fails to mention to all here is the deal structure. Any good business man would run screaming from this kind of deal even in a good business climate. It’s why it’s been close to two years and still no sale.
More importantly, he knew that he would not have a chance to earn 75% approval of the MLB owners to become the new owner of the club and that he would have no recourse per the agreement he signed when initially bidding for the ballclub.
Mr. Cuban, you did touch a tip of the iceberg of this whole process for the fans but you know your couldn’t say more due to that confideniality agreement you signed when you showed interest in bidding on the team. It’s why there is very little in the media on this process or where things stand in the sale.
I worked for a ballclub for over a decade on the business side of this game so I know what is involved in the sale of a club. I am also quite aware of the structuring of the deal that Sam Zell is looking for to avoid paying six figures in capital gains taxes due to the conversion of Tribune Company into an S corporation which requires Tribune to hold assets for 10 years before they can be sold.
So bottom line, Mr Cuban, you are out of the bidding process and that is that. Whomever Zell might choose of the remaining potential owners will be the new owner of this team approved by MLB and someone the financing will be worked out. I suspect this is also why this took so long because Zell wanted to sell to you but was fighting with MLB to make sure he could have you approved but couldn’t make any leeway.
See, my IU education taught me quite a bit about business, didn’t it?
Comment by Annie -
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I’d be really interested to know more about how the Cubs and Sox “are treated as equals in their business dealings.” Are you talking about local TV rights? Local sponsorship and promotion? How is it even possible there is parity there? How did the free market mechanism break down — just bad business by the Trib (or more nicely, smart business by the Sox)?
Comment by Ryan -
Mark, cash is indeed king. And you’re over-allocated in pro sports, anyway. There are plenty of other investments out there that can give you your competition fix and generate superior returns at the same time. But I agree with you that the Cubs are quite an asset.
Comment by Sam -
What an awesome position for you to be in as long as it does not get emotional! If you do end up getting the team you should be able to write both sides of the deal. catbird’s seat for sure.
Comment by Shawn Shepherd -
Pingback: Deal Journal - WSJ.com : Afternoon Reading: How Mark Cuban Pursued the Chicago Cubs
Mark, I played minor league ball, and for what its worth, you know better than anyone what is needed for this purchase. Please take another look at the financial picture for this team. The people of Chicago and those around the country would open their wallets for a winner, not to mention the avenues it would open up for someone with your knowledge of technology and marketing. You would have the revenue of the Yankees. This city will be so dissapointed with any of these other bidders, because nothing is going to change. They will run it strictly as a business. If you decide not to go forward with it, buy a couple minor league teams. Youll have just as much fun. I can help you with those. (GIVE IT ANOTHER LOOK AND GO FOR IT)
Comment by Tony (Chicago) -
Post like this are the reason I read your blog… Thanks
Comment by Neal -
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Im a die hard cubs fan and all i can say is i want you as the owner. i see the passion you put in the mavs and need you to bring it to a faceless ownership. i hope you get it. sell the mavs buy the cubs!
Comment by Jeremy -
Since you are talking about the sale publically, I would bet that Tribune has already selected the buyer. If they had not, you would have violated your confidential agreement. Too bad. With all of my suggestions I was sure that you could pull this one off. However, “Lady Luck” has smiled on you again and you have cash at an opportune time. (Similar to your situation in 2000) Funny because had it worked, you would have bought the Cubs almost exactly 9 years after buying the Mavericks. Now the hard thing is what to spend the “extra” billion on.
Comment by econ365 -
i just wanted to echo some thoughts above – thank you, sincerely, for being so open and honest about the process; it is so refreshing. and i think it’s amazing when an owner will spend to win. it makes being a fan a hell of a lot more fun. thanks again.
Comment by jill -
Mark- Really upset you weren’t given a better chance! Chicago would have loved you as an owner!
Comment by Grant -
If you really want a “unique opportunity to own one of the most storied franchises in sports”, then how about buying the St. Louis Cardinals for less than half of what the terrible cubbies would cost you?
Comment by Mike -
Mark, I greatly appreciate your behind the scenes insight on such a
big decision like buying the Cubs. Am I correct in thinking that you’re
not out of the running yet and this is still an ongoing matter?
Please keep us posted on the dealings.
I wish you the best of luck and continued success in the New Year
Comment by Dave Lewis -
Being a lifelong Chicagoan and dedicated, die-hard Cubs fan I cannot express how excited I was that you were interested in the team. I, and many people I know, feel you would be great for baseball and an asset to the team and league. The prospect of our ownership was amazing and we all hoped it would work out. Now, the outlook to the average fan is a little bleaker because it means that team, based on the three remaining publicized bidders, will become more corporate-focused and less fan-friendly. Huge disappointment.
Comment by Dani -
The Trib may need to keep the franchise and sell the publishing instead. Not terribly realistic, I know but honestly, that business is dying so very fast.
Comment by DallasBK -
Mark – I’m lifelong cubs fan – would love to have you in ownership here…. Don’t give up!
Comment by Mike -
Great insight on your attempt to buy the Cubs.
I am a long time Cubbie fan and was excited to know that you were going to get a shot to but them
It would have been an exciting time for us long time Cub fans to actuall cared abouit the team and their prospects of winning. I know you would have taken an active role in making sure the team was ready to play on and off the field everyday. I am positive that you would hav taken care of Wrigley for the next generation of Cub fans to see and use.
I hope that Sam gives you another chance to revisit buying the Cubs.
Comment by Scott -
Buy the Redsox!!!!!!!!!!!!!!! Shares that are to be sold
Comment by Erik -
Above all else I think what you have written here is an outstanding example of negotiating in good faith and with complete transparency. Posts like these surely strike tremendous fear in the hearts of lesser character.
Comment by BillFitz -
As a huge Cubs fan, I know it would be great to have someone as passionate as you about winning take over the helm of this great (but losing) franchise. Being a fan and seeing the owner every day root for the wins would be priceless. I do agree that your money with this market is probably best suited elsewhere…I do think you would be great for baseball and hope you do buy a franchise even if it isn’t the Cubs…hopefully it would be your home team the Pirates eventhough I wouldn’t want to be competing with someone who actually loves their team! Best of luck…hopefully Zell/Tribune Co. call you back!
Comment by Kevin -
Like Ozzie Guillen said “Fu*k the Cubs”.
On a sidenote, convince Hicks to sell you the Rangers.
Comment by JasonJ -
Pingback: Clark & Addison Blog - CubHub.net » Blog Archive » Mark Cuban comments on Cubs sale process
Your post today is quite revealing. It seems you are saying there were questions in the MLB owners approval process but also some Jerry Reinsdorf questions as well. But overall, yours was a financial/funding decision to ask for an extension. Probably a brilliant move as even though the “winning bidder” is rumored to be announced this week, there is a long way to go until funding a deal like this in today’s market can come to fruition.
I would bet this ownership change is still a long way away, and perhaps your extension request is being honored inadvertanly as no one else can close this deal, at this time! I hope you’ll stay engaged in this process – your presence in MLB and that as owner of the Cubs would be pretty refreshing for all. Its about time some new ideas get called up to the Major Leagues!
Comment by Clark Addison -
Sounds frustrating but not surprising. If you thought the process
took too long imagine how us die-hard fans feel ? We most likely could
have kept Wood and DeRosa if we had a new owner in place instead of
having to let them go in a salary dump.
Anyway feel free to come to games anytime. Check out the top LF corner
for a group of serious fans.
Comment by Jessica -
The sports bubble is alive and ready to burst at any time.
I would agree that investing in any company, house, car, etc. without
the necessary operating income to maintain the enterprise (in this
case, player salaries to keep a competitive team) would not be a smart
move. Personally, I would love to pool together a group of investors
and purchase a minor league team. I believe there’s more freedom, less
public scrutiny, and more personal attachment than an MLB franchoice.
Mark you said it best in that if your goal was to make money, there are
more than enough opportunities outside of sports to invest your hard
Comment by matt -
As a life long Cubs fan, I am praying to sweet infant Jesus that you get the oppportunity to buy the Cubs.
Comment by Alex Williams -
I loved the article and appreciate you taking the time to write it. It gives us fans some insight on what goes on behind the scenes.
I’m a lifelong Cubs fan who believes that even though we are successful right now, we are perhaps just a new owner,and the right owner away from making it to the very top of the mountain. It would be nice to see if you are that owner.
Comment by Vince S -
Please, please, please, please please buy the Rangers!!!!
We’re dying with an owner who simply won’t invest.
This town supports winners. Win a division title and the revenue will follow.
Comment by Rangers fan -
I knew you somewhat in IU and it is something to see how far you have gone. When the Cubs went up for sale I knew things would be interesting in that the private equity firms I was dealing with even back in December 2006 began to contract and seek safe harbor for some of their exposed positions. As a lifelong Cub fan it would have been grand seeing you bring a winning demand to the organization not unlike Steinbrenner did or how a mutual acquaintance like Bob Knight would demand demand, kind of like how his friend Parcell’s did in Miami. That all said it is sad you will not be able at this time to take over the reigns of authority—but this is a dynamic time where changes will continue to present itself. As you pointed out CASH is King now so valuations are diving since servicing assets cannot be extended over time. I think MLB (and the NBA and other sports ) will contract in the next 2-4 years, some might not be orderly and like San Diego external and acute financial pressures will present ownership groups even the one that might emerge successful this month for the Cubs and you might be able to revisit this in the near term.
What I find also interesting is that the Cubs have increased payroll 30% since the sale process began and now it appears the Cubs are in the top 2-4 teams in payroll. Were the pursuing bidders given permission to approve this serious fiscal liability?
Finally just want you to know that as Sampson was beginning the dismissal process I had conversations with Terry at IU and suggested another acquaintance in Tom Crean which emerged asIU’s decision. How do you view Crean’s progress?
Comment by Bob -
Thanks for sharing Mark. These kind of posts are the exact kind of insight we value from you, and the exact kind of thing that scares off the ‘old money’ MLB owners who fear you and the interwebs. Keep rockin it man, we’re behind you.
Comment by Dan Driffill -
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Thanks for the insight on the process Mr. Cuban. I do
wonder what your opinion is of Bud Selig. More specifically
do you think his relationship to the Milwaukee club
made him adverse to you owning the Chicago club. He seems to
want someone more along the lines of a John Canning in that
position. Someone that doesn’t really intend to spend to win.
At least that is the perception of most cubs fans.
Comment by aaron b -
Mark – I can’t tell you how much I appreciate getting this window into the process. Obviously you were a lot of our first choice to own the Cubs, so there is necessarily some disappointment. Continued good luck to you, and sincerely, thank you for sharing all of this.
Comment by Ace -
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Thank you for sharing what the ins and outs were of the whole process. Most of us only get fabricated crap from the chicago meadia and never really know whats going on. Jerry, no matter how cordial he is, would never want you on the opposite side of town because then the cubs would get even more coverage than they already do over his triple A team on the south side. As for that brewers fan, go suck on a sausage
Comment by Tony -
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Mark I’m speaking on the majority of Cubs fans when I say we were sad your attempts to buy the Cubs was unsuccessful. Interesting read, thanks for sharing the information.
Comment by T. McCarville -
Mark – We’d love to have you in the NL Central.
Watching you and the Cubs collapse every year would be great.
Comment by John Izzo -
MLB is a club of Good Ol’ Boys, Mark. As much as we’d all love to see you involved with MLB, and as good as you’d be for the archaic league, you wouldn’t be doing it ‘their way’. You probably had no chance from day one, no matter how much money you brought to the table.
Comment by Craig -
Thank you for your writings.
Having an active interest in basketball and baseball
I am pleased that you have taken the time to write.
I enjoyed the inside scoop on the Cubs and your perspective.
Keep up the good work.
Comment by richard -
I’ve been a life long fan of the Cubs & I think you would make a great addition to the team & the city of Chicago.
Comment by Brian Kirk -
Such an interesting insight, Mark…
But let us know. What are the odds as you see it, they come back to you?
Comment by Pulpo -
This is really interesting stuff, I really hope there’s more coming on this topic.
When you were buying the Mavs, was the process just as painful? Would be curious to hear what factors differ when it comes to purchasing an NBA vs. an MLB franchise.
Best of luck, hopefully the opportunity will arise again in the near future!
Comment by Kyle Paice -
Congrats Mark! Great hearing your story on how it happened. Hopefully I’ll be able to make it out to more Cubs games – finally a winning team?
Comment by Gyutae Park -
why don’t you attack the NYT’s stake in the BoSox? Cheaper and get your foot in the door
Comment by Nick -
sorry to hear it didn’t work out. would have been great hearing you sing, “take me out to the ballgame”
Comment by Terry Johnson -
Comments are closed.