Speculation: NY Islanders Sale Talk ONLY Part III *Barroway out Post 652*

[BillD]

I am a lawyer, but not the kind that would ever do this type of work. I do criminal defense.

I mean, if you had a deal on the table and you wanted to make sure it was left open (an "option" is what this is called) you pay for that privilege.

I'll give you an example:

Say I'm saying bulk "Big Corsi" tee-shirts.

You tell me that you want to buy the whole summer collection of "Big Corsi" tee shirts. You're offering $400 for it.

I would say, "Lets draw up the paperwork, but I haven't decided that I want to sell my entire collection so here's what I'll do: I'll pay you $10 to leave your "offer" open for me to accept at any time; if I don't take you up on the offer you can keep the $10."

That's an option in a nutshell.

Now I'm not following the sale stuff very closely (or even at all, really); but I do have a pretty good grasp of the basic legal principles I learned in law school, and this is one of them.

Does that square it up a little bit?

Definition of 'Breakup Fee'

A common fee used in takeover agreements if the seller backs out of a deal to sell to the purchaser. A breakup fee, or termination fee, is required to compensate the prospective purchaser for the time and resources used to facilitate the deal. Breakup fees are normally 1-3% of the deal's value.
A company might pay a breakup fee if it decides not to sell to the original purchaser and instead sells to a competing bidder with a more attractive offer. Sometimes a breakup fee can discourage other companies from bidding on the company because they would have to bid a price that covers the breakup fee.

 

[JeffNYI]

I'm not a lawyer but doesn't a $10M break up fee for a $400M deal seem a little light?

Granted, I only looked up 1 example... but the AT&T DirecTV merger had a breakup fee of 2.9%...

So the NYI/Barroway breakup of 2.5% doesn't seem out of whack by that comparison..

 

[scott99]

I would say this comes pretty close to what went down. We all knew that Wang operates on the fringes (CA, Smile Train, etc.). We are stuck with him and at his whim he can and will continue to make the team less than it can become if cultivated.

So Bill, your sources haven't heard anything about what Matty Boy at IM said his sources have heard ? That Barroway was "outbid" and the deal is almost done with a different person. I'm assuming your source only knows what Barroway is saying.

 

[BroadwayJay*]

Definition of 'Breakup Fee'

A common fee used in takeover agreements if the seller backs out of a deal to sell to the purchaser. A breakup fee, or termination fee, is required to compensate the prospective purchaser for the time and resources used to facilitate the deal. Breakup fees are normally 1-3% of the deal's value.
A company might pay a breakup fee if it decides not to sell to the original purchaser and instead sells to a competing bidder with a more attractive offer. Sometimes a breakup fee can discourage other companies from bidding on the company because they would have to bid a price that covers the breakup fee.

Strange concept to me because you could potentially litigate for future lost income if a deal is actually "done".

Again though, this isn't my practice area.

If Wang robs a stash house in Washington Heights I'll be the go-to guy on understanding it.

 

[blitzkriegs]

I would say this comes pretty close to what went down. We all knew that Wang operates on the fringes (CA, Smile Train, etc.). We are stuck with him and at his whim he can and will continue to make the team less than it can become if cultivated.

Love this gem about Wang and his business operations. Brings in CA, Smile Train, and Neuloin under one umbrella. He wants money, control, and has numerous subservients. Keeps his loyalty close, hooks them up, and therein buys loyalty. You DON'T cross him. He gave his secretary at NYI a board seat on Neuloin - his wife's company. How absurd. Why? Because he needed the majority votes and what better way to line them up. Look at the timing (year), size ($), people (friends/IOUs) and how the donations went from his CA stock (not cash) to Smile Train in vague categories for the 'future.' Than he gains control of Smile Train in a 'merger' (maybe he started ST to compete with the other similar charity with intent to take it over as vehicle to shelter his CA $), where he controls ALL the funds because he puppeted the board seats with Isles, Neuloin, and ex-CA people. Amazing. I give this guy credit.

So, about those millions in loses on the Isles? (ya know, the Isles tax records, yet there's plenty of money in charities...)

http://www.itbusinessedge.com/cm/bl...-more-shenanigans-from-charles-wang/?cs=45738

 

[BillD]

So Bill, your sources haven't heard anything about what Matty Boy at IM said his sources have heard ? That Barroway was "outbid" and the deal is almost done with a different person. I'm assuming your source only knows what Barroway is saying.

No, there is no knowledge of Matty Boy's comments. As stated, the guy I know is one of Barroway's investors, and a small one at that. he knows only what Barroway had disclosed to the group. But from what I have been told, Barroway was NOT outbid. His offer was accepted by Wang, then ignored by Wang as if it didn't happen. If there is another bidder who showed up with a bigger number, we don't know it yet. Could be of course. If there is any more context to it that is disclosed, there is no reason to withhold it anymore. But as usual, the veracity of the information has to be considered, and we will never know all the details.
At this point it is just curiosity as the deal in over according to Newsday (probably fed by NYI).

 

[scott99]

No, there is no knowledge of Matty Boy's comments. As stated, the guy I know is one of Barroway's investors, and a small one at that. he knows only what Barroway had disclosed to the group. But from what I have been told, Barroway was NOT outbid. His offer was accepted by Wang, then ignored by Wang as if it didn't happen. If there is another bidder who showed up with a bigger number, we don't know it yet. Could be of course. If there is any more context to it that is disclosed, there is no reason to withhold it anymore. But as usual, the veracity of the information has to be considered, and we will never know all the details.
At this point it is just curiosity as the deal in over according to Newsday (probably fed by NYI).

Your last sentence is very telling, and I agree. Not ONE news agency has mentioned/agreed with part 2 of Matty Boy's comment that another buyer outbid Barroway. HE was THE first one to report that Barroway was out though. Interesting.

 

[BroadwayJay*]

Definition of 'Breakup Fee'

A common fee used in takeover agreements if the seller backs out of a deal to sell to the purchaser. A breakup fee, or termination fee, is required to compensate the prospective purchaser for the time and resources used to facilitate the deal. Breakup fees are normally 1-3% of the deal's value.
A company might pay a breakup fee if it decides not to sell to the original purchaser and instead sells to a competing bidder with a more attractive offer. Sometimes a breakup fee can discourage other companies from bidding on the company because they would have to bid a price that covers the breakup fee.

Can you get me a source on this breakup fee that NYI would have to pay?

The more I think about it, the more my lawyer senses are tingling...

 

[stranger34]

please tell me that was sarcasm

The Rays are terrible, they are trying desperately to leave that dump and get a new stadium (wont happen) and they dont sign any major stars. They just traded David Price cause they couldnt afford him as he was going into Free agency.

Trust me, Hedgefund guys are no equivalent to Charles Wang. They dont invest for the love of sport. It is money they want and they will sell the team the minute they get a better deal. We dont need that merry go round happening

WOW!? The Rays are one of the best run small-budget organizations in all of sports. They are right there neck and neck with the A's.

or do you simply mean that they won't spend as much and will monitor the bottom line?

I am ok with that if properly executed

 

[stranger34]

Granted, I only looked up 1 example... but the AT&T DirecTV merger had a breakup fee of 2.9%...

So the NYI/Barroway breakup of 2.5% doesn't seem out of whack by that comparison..

cool! good find. I was just a little surprised the norm wasn't a bit higher to deter this kind of behavior.

 

[beach]

They are right there neck and neck with the A's.

Umm, no, they're not...

 

[BroadwayJay*]

Umm, no, they're not...

Not this season, but in the big picture I think that's a fair statement.

 

[stranger34]

Love this gem about Wang and his business operations. Brings in CA, Smile Train, and Neuloin under one umbrella. He wants money, control, and has numerous subservients. Keeps his loyalty close, hooks them up, and therein buys loyalty. You DON'T cross him. He gave his secretary at NYI a board seat on Neuloin - his wife's company. How absurd. Why? Because he needed the majority votes and what better way to line them up. Look at the timing (year), size ($), people (friends/IOUs) and how the donations went from his CA stock (not cash) to Smile Train in vague categories for the 'future.' Than he gains control of Smile Train in a 'merger' (maybe he started ST to compete with the other similar charity with intent to take it over as vehicle to shelter his CA $), where he controls ALL the funds because he puppeted the board seats with Isles, Neuloin, and ex-CA people. Amazing. I give this guy credit.

So, about those millions in loses on the Isles? (ya know, the Isles tax records, yet there's plenty of money in charities...)

http://www.itbusinessedge.com/cm/bl...-more-shenanigans-from-charles-wang/?cs=45738

Wang is a legit gangster. I wonder if he groomed Sanjay as his patsy from day 1.

 

[stranger34]

I am a lawyer, but not the kind that would ever do this type of work. I do criminal defense.

I mean, if you had a deal on the table and you wanted to make sure it was left open (an "option" is what this is called) you pay for that privilege.

I'll give you an example:

Say I'm saying bulk "Big Corsi" tee-shirts.

You tell me that you want to buy the whole summer collection of "Big Corsi" tee shirts. You're offering $400 for it.

I would say, "Lets draw up the paperwork, but I haven't decided that I want to sell my entire collection so here's what I'll do: I'll pay you $10 to leave your "offer" open for me to accept at any time; if I don't take you up on the offer you can keep the $10."

That's an option in a nutshell.

Now I'm not following the sale stuff very closely (or even at all, really); but I do have a pretty good grasp of the basic legal principles I learned in law school, and this is one of them.

Does that square it up a little bit?

Yes, this puts it into layman terms very well. thanks

 

[stranger34]

Umm, no, they're not...

Over the last 10 years they absolutely are. They both consistently outperform their payroll. The A's might be a little more consistent year over year but the Rays have gone further in the playoffs. I think you can also include the Twins in this discussion but they have been bad for a few years now.

The Rays have done a great job of asset management. Look at the big guys they let walk or traded... BJ Upton, Carl Crawford, Delmon Young, James Shields etc. Did they really miss any of them? James Shields is still very good but they got Wil Myers for him. This Price trade looks like bad news but based on their track record who knows...

 

[BroadwayJay*]

Yes, this puts it into layman terms very well. thanks

The other poster has described it as something different though. I'm presently contemplating what he suggested - but as always the mind of the skeptic works more than it probably should.

 

[doublechili]

Wang is a legit gangster. I wonder if he groomed Sanjay as his patsy from day 1.

Sideshow Sanjay?

When does he get out of prison?

 

[MatthewBarnabysTears]

WOW!? The Rays are one of the best run small-budget organizations in all of sports. They are right there neck and neck with the A's.

or do you simply mean that they won't spend as much and will monitor the bottom line?

I am ok with that if properly executed

"best run" is fair from a front office perspective, but not ownership-wise. considering that basically all MLB teams are making more money than they know what to do with, it's pretty inexplicable to have to sell high/not re-sign all of the core of the pennant-winning caliber teams (guys like david price, scott kazmir, matt garza, james shields, carl crawford and bj upton) instead of locking at least a few of them up long-term. granted, a bunch of the trades they made to dump those guys worked out great for them and some of them went on to be busts elsewhere, but that speaks to the front office's skill and not ownership.

basically, the rays' current owner is charles wang and vince naimoli was like the milsteins. none of them are ideal.

 

[BadFella]

So you don't want them to go to one guy from Philly but then you say they hope they get sold to a guy from Cleveland and a guy from Russia?

Got it.

The guy from Cleveland has ties to the community. He owns most of the arena, part of the local basketball team, and the mall across the street. Oh, not to mention controls the Coliseum already. And Cleveland doesn't have a NHL team. New Yorkers kinda hate Philadelphia.

As for the Russian, he throws money at things with little disregard. And he likes Brooklyn because it has the largest Soviet expat community outside of the former USSR.

 

[michaelrc51]

This is all hypothetical and assumes the $10M penalty - which would be normal based on large business transaction reports we've all heard in the media - is really there..

Barroway would have insisted on that language being in the contract, and as I just said it's also standard operating procedure.. so Wang would have had to agree to have that language in there (which again is SOP anyway) to get Barroway to sign..

Then Wang packages up that document and takes it over to the real buyer and gets them up by MULTIPLES of $10 million....

Frankly, the $10M could just have been an investment.. a tool to get other buyers to pay even more..

It very well could have been.
It just isn't like Wang to throw away $$$$ like that even if it could be a "smart" expense.
I think we have all seen enough of Wang's money saving deals to think that this isn't a move he would make.......unless there is another deal coming ??

Let's hope there is another deal in the works and the Wanger used Barroway as bait.

 

[The Underboss]

Guys, we're skirting some fine lines here, be very careful please. I want everyone to have their say but we can only let you go so far.

 

[stranger34]

"best run" is fair from a front office perspective, but not ownership-wise. considering that basically all MLB teams are making more money than they know what to do with, it's pretty inexplicable to have to sell high/not re-sign all of the core of the pennant-winning caliber teams (guys like david price, scott kazmir, matt garza, james shields, carl crawford and bj upton) instead of locking at least a few of them up long-term. granted, a bunch of the trades they made to dump those guys worked out great for them and some of them went on to be busts elsewhere, but that speaks to the front office's skill and not ownership.

basically, the rays' current owner is charles wang and vince naimoli was like the milsteins. none of them are ideal.

kazmir was shot when he left the Rays. Out of all of those only Shields and Price look like they were worthy of being locked up long term and Price just got traded. When Upton and Crawford left they looked solid too...

They have done a masterful job with that team. It's a real shame they didn't beat the Phillies in the series

The A's have done this too with hudson, Zito, and Mulder not being signed long term and they have gotten along just fine too.

 

[MatthewBarnabysTears]

kazmir was shot when he left the Rays. Out of all of those only Shields and Price look like they were worthy of being locked up long term and Price just got traded. When Upton and Crawford left they looked solid too...

They have done a masterful job with that team. It's a real shame they didn't beat the Phillies in the series

The A's have done this too with hudson, Zito, and Mulder not being signed long term and they have gotten along just fine too.

but how much easier would it have been if they could have re-signed at least one of them, or if they had room for the basic trial and error most teams take for granted? again, this isn't about front office talent, it's about ownership. larry beinfest was amazing at re-stocking the marlins after every firesale, but isn't anyone going to mistake that organization as a whole (including ownership) as anything other than a sick joke?

 

[Dutch Frost]

WOW!? The Rays are one of the best run small-budget organizations in all of sports. They are right there neck and neck with the A's.

or do you simply mean that they won't spend as much and will monitor the bottom line?

I am ok with that if properly executed

best run farm team maybe but their star players leave once they become free agents. Dont feel like being the farm league for the NHL, I witnessed that during the Milbury era.

They have the worst attendance in the league and I DO NOT WANT THE ISLANDERS TO BE THE TAMPA BAY RAYS!!

WE PLAY IN ****ING NEW YORK CITY!!!!!

 

[PK Cronin]

WE PLAY IN ****ING NEW YORK CITY!!!!!

No we don't.