MLB Baseball Team Valuation

Photographer: Christian Petersen/Getty Images
Photographer: Christian Petersen/Getty Images

The World Series might end tonight if the Boston Red Sox can wrap this up. My brother sent me this really cool Bloomberg business valuation article. It seems that Bloomberg is going head to head with Forbes on this sport business valuation. Here’s is the link to the full article.

Videos:

Yankees Top Dodgers as Most Valuable MLB Franchise

Bloomberg Link Panel on Sports-Related M&A. 30 minutes of exchange between sports finance guys.

Infographic

Bloomberg MLB

Here are the notes, according to data compiled by Bloomberg:

  • The average value of a Major League Baseball team is $1 billion, more than 35 percent higher than previous estimates.
  • The New York Yankees are worth $3.3 billion, making them the sport’s most-valuable enterprise. The Los Angeles Dodgers rank second with a value of $2.1 billion.
  • According to Anthony Di Santi, the managing director of the sports finance advisory division of New York-based Citigroup Inc.’s private bank, “Major League Baseball is catching up to valuations of the National Football League It’s because they’ve been exploiting the media opportunities that are available to them on a national level.” He said regional sports networks also play a role when valuing teams.
  • Ten teams are worth more than $1 billion. The Boston Red Sox and New York Mets each are valued at more than $2 billion, the data shows.
  • The amount shared between the large market teams with the smaller market teams was about $360 million in 2012. Those with lower revenues receive bigger amounts from the fund.
  • Baseball teams are valued based on multiples of revenue, not operating income, according to Gerald Cardinale, managing partner of private equity firm RedBird Capital Partners and a co-founding investor of the YES Network. He said enterprise value, defined as market capitalization plus total debt minus cash, is the best way to quote team transactions.
  • The Steinbrenner family owns 55 percent of Yankee Global, according to a 2010 NBC New York report published after George Steinbrenner’s death.
  • Bob Rose, the public relations director for the Oakland Athletics, said Bloomberg’s $590 million valuation of the team was low. The franchise had revenue of $175 million in 2012.“If hypothetically we were to sell, it would be more like four times $175 million, or $700 million,” Rose said in an e-mail.
Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s