The St. Louis Cardinals will buy the Memphis Redbirds (Class AAA; Pacific Coast League) and Memphis will acquire AutoZone Park, with the two sides signing a long-term lease.
The Memphis Redbirds Baseball Foundation, beset with financial issues in recent years, was seeking to shed both assets and met seriously with several parties, including at least two minor-league operators. The Cardinals had expressed interest over the years in the Redbirds and came back around to this new deal. The Foundation has been operating the Redbirds and AutoZone Park under a forbearance agreement since it defaulted on its required bond payment in 2010, with Global Spectrum managing both on a day-to-day basis.
Fundamental Advisors LP, which holds bonds on the team and the ballpark, has signed off on the deal and will reportedly take a loss on its investment of $24 million, which seems to us to be a little questionable. No word yet on the purchase price for both assets; the minimum price for any Triple-A team these days is $20 million. Forbes put a value on the Redbirds of $29 million, but there’s a lot to question about the Forbes valuations.
Mayor A C Wharton, Jr. and members of his administration have conducted extensive due diligence and will recommend the Memphis City Council approve the transaction during its December 3 meeting. The agreement calls for the parties to close the transaction by December 31, 2013.
“We are thrilled that we are in a position to return the stadium back to the people of Memphis,” said John Pontius, treasurer for the Memphis Redbirds Baseball Foundation. “Our team will benefit from best-in-class leadership of the Cardinals. We want to thank everyone involved, and look forward to a bright future ahead as a part of this world-class organization.”
“The Redbirds represent the best of minor league baseball,” added William DeWitt Jr., Chairman and CEO of the St. Louis Cardinals. “This opens the door to countless new opportunities for our combined organization, and we are thrilled about the prospects for baseball fans in both of our great cities.”
“Returning ownership of AutoZone Park to its fans is a major victory for our city,” said Mayor A C Wharton, Jr. “This agreement will retire all of the outstanding bonds and will stabilize the long-term future of the Redbirds and AutoZone Park. Also, we will be investing in our future and partnering with the best organization in MLB. We have done our homework and believe that it is in the best long-term interests of the City and its residents to move forward with this transaction. On December 3rd, I will encourage City Council to approve this agreement, which I believe will bring renewed excitement and energy to Memphis and our beloved Redbirds.”
“We are proud of what we have achieved by working with the City, the Foundation and other interested parties during the turnaround phase of this project,” said Laurence Gottlieb, Chairman and CEO of Fundamental Advisors. “By every observable metric, the team and stadium are in a far better place today than when we acquired the bonds. The time is right to turn the stadium back over to the great city of Memphis, and to leave the team in the hands of the world-class St. Louis Cardinals organization. We will be cheering from the sidelines.”
RELATED STORIES: Redbirds still on market entering 2013; Status quo reigns in Memphis; Talk of AutoZone Park sale premature: Pontius; Memphis looking at buying AutoZone Park; Weiss, Global Spectrum take full reins of Memphis Redbirds tonight
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