Indians’ Offseason Moves Make Sense with News of Potential Royals Purchase
Vince Guerrieri | On 29, Aug 2019
Suddenly, the Indians’ offseason moves all make sense.
The Indians shed payroll, letting Michael Brantley walk and dealing away Edwin Encarnacion. (They also traded away Trevor Bauer in midseason; the return on him seems good, but the prospect of arbitration this off-season followed by free agency after next season had to be a factor.) Owner Paul Dolan is managing expectations about the Indians re-signing all-world shortstop Francisco Lindor – or at least, trying to. “Enjoy him” seems destined for Cleveland sports infamy, right up there with Ray Farmer talking about slow-brewed coffee and erstwhile top Browns pick Mike Junkin being described as a “mad dog in a meat market.”
The moves were mystifying, particularly since the Indians had the best manager in the major leagues in Terry Francona, probably the best rotation and at least for the moment, Lindor. But it all makes sense with recent news that the Royals could be sold – and the buyer could be Indians minority owner John Sherman.
Sherman, a Kansas City billionaire, bought into the Indians in 2016. His purchase became official during the Tribe’s 14-game win streak, and his first season as a minority owner ended with a World Series Game 7. Dolan had been looking for a minority partner for years, going so far as to hire a broker, Allen & Co., the previous year. (The company’s point person was Steve Greenberg, whose father Hank was a Hall of Fame slugger and former general manager and part owner of the Indians. It’s worth noting that the elder Greenberg declared baseball dead in Cleveland in the 1950s, after trying unsuccessfully to move the team to Minneapolis.)
The new partner, along with a deep postseason run, provided an influx of cash for the Indians, who under Dolan’s ownership have either misspent (helloooo, Nick Swisher!) or not spent. With money – and coincidentally, a free agent market that’s seem depressed over the past few years – the Indians were able to sign the free agent Encarnacion, and it seemed like 2017 would be even better for the Indians. They finished with the best record in the American League, but the season came crashing down in the American League Division Series. The Indians the following year just couldn’t get it together, and although they won a third straight Central Division title, were swept in the first round.
And key pieces were dealt away – or in the case of Brantley, were allowed to walk. Worse yet, the Indians didn’t appear to have any interest in the free agent market (although they were hardly alone; despite splashy signings of Bryce Harper and Manny Machado and an extension for Mike Trout, the hot stove league seemed kind of cold). Why would the Indians stand pat in a division where the Twins were clearly getting better – as were the other potential division winners in the American League?
I have a theory. Let me offer my usual caveat: This plus a dollar gets you a cup of coffee at McDonald’s. Although the news just broke about the sale, negotiations didn’t necessarily start in the past week. And Sherman will have to divest himself of his holding of the Indians. The offseason was a slow one for the Indians because the Dolans were going through the metaphorical couch cushions looking for money to potentially buy out Sherman. (Sports team finances are particularly opaque, since most teams are privately owned, and neither Dolan nor Sherman have said how much of the team Sherman owns.)
It’s worth noting here that the Dolans are nowhere near as liquid as Sherman appears to be. The family bought the team for $323 million – then a record – in 1999, the same year they were outbid by Al Lerner for the expansion Browns. That purchase, for $530 million, was also a record, and a member of Dolan’s proposed ownership group was – I swear this is true – Bill Cosby. So perhaps we should be grateful for small favors.
The money for the Indians purchase came from Paul Dolan’s father Larry and multiple family trusts. The Royals’ value is estimated around $1 billion, about average for the value of a major league team, but a marked increase from the $96 million it sold for 20 years ago and a lesson in asset appreciation.
Of course, if most owners are to be believed, the only way to make money off a team is by selling it.
Photo: Dan Mendlik/Cleveland Indians