Padres broke… question mark?

In an otherwise generic “camp report,” Scott Miller at CBS Sports dropped this bombshell:

New owners so far have failed to make any significant first impression, and for good reason: This team is broke. Former owner John Moores and temp Jeff Moorad lifted $200 million off the top of the club’s new cable television deal on their way out the door, leaving the Padres, once again, cash poor. Marquis was the club’s sole major-league free agent signing over the winter. Publicly, the Padres spoke of a weak free agent market that was overpriced. But multiple sources say the dire financial situation forced the Padres to sit on the sidelines this winter after re-signing Carlos Quentin and Huston Street last summer. Money that had been the light at the end of the tunnel, that was supposed to be pumped into the club, instead disappeared with Moores and Moorad.

Padres camp report: Likes and dislikes

(Emphasis mine.)

As you might recall, Dave Winfield said basically the same thing last month: What is your take on the new Padres ownership?

Winfield: They’re good. Everyone is not quite in place yet. Ownership is. But key executives, a couple are in, a couple are out. But this is their first full year coming up. We’ll see what we can make happen down there. They haven’t done a lot of shifting around of bodies on the Major League roster yet.

Winfield: No, and it’s hard to compare with what the Dodgers have done and teams like that. Everything pales in comparison. The Dodgers have an awful lot of money to spend. That’s what it takes. These guys paid $800 million to buy the Padres. You know that always doesn’t leave a lot of money to make the moves that you want. Between TV dollars and overall revenue, the Padres have more money than they used to.

Winfield: Yeah, and the team costs more money than it used to. We’ll see what works out.

Dave Winfield shares thoughts on Hall of Fame, scouts and Padres fortunes

(Emphasis mine again.)

It should be noted that Padres owner Ron Fowler publicly denied Winfield’s claim.

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  • Jorge
    • Melvin

      That seems odd.

    • Gloccamorra

      Moores took 51% of the $200 million. Moorad took whatever percentage of his group’s 49% he owned, and Fowler and others who left the Moorad group to join the O’Malley group got their percentage of the percentage to pay for their share of the purchase. How Ron Fowler’s and his former Moorad partners’ using the money to buy the club differs from what Moorad wanted to do is something an accounting/tax/MLB expert would need to explain. I’m not sure anybody would understand it anyway.

  • Loren

    No! Oh no! We’re screwed….again!

  • Shouldn’t espn and the other big national media players be all over this. Just becuase it doesn’t involve the Lakers or Tebow, doesn’t mean this isn’t a huge story (triple negative!). A fanbase getting outright swindled by a host of characters, including MLB for allowing this to happen.

    • I’m more concerned about the local media letting this story (and every story) slip by.

      • I’ve given up on the local media. There’s just not enough people who care in San Diego for them to make a difference. Plus only Darren Smith seems to get it.

      • Met

        And 1090 moved him to midday when everyone’s working and no one can hear him.

      • I can’t even imagine the thought process behind stashing Smith and Caswell in the midday doldrums and giving Scott and BR the afternoon drive. Thats like sticking your Ferrari on school bus duty and driving a cement truck down Sunset

  • Met

    OK, one of you smart guys needs to explain something to me…

    MLB wouldn’t let Moorad complete his purchase of the Padres for, among other things, his plan to use the money acquired in the new TV deal to finance the purchase. Then, MLB allows Moores and Moorad to pocket $200M of the TV deal money on their way out the door.

    Semantics aside, doesn’t that mean that MLB allowed the Fowler group to pay Moores and Moorad with money from the same source they wouldn’t allow Moorad to pay Moores?

    Can anyone explain the flaw in my reasoning? Because it seems MLB changed the rules mid-stream.

    • The problem is that it was never Fowler’s money. Moores was the owner when the Padres signed the new TV deal, making it his money.

      • Met

        I thought I’d missed something in translation. Thanks Ray.

    • GoldenBoy

      Bud Selig is to blame just as much as Moores and Moorad. He shouldn’t have let them get away with it. He protected the Dodgers from McCourt’s plan to swindle the team. Look where they’re at now. Selig didn’t step in to the help the Padres, cause they’re not considered a “treasured franchise”.

  • Melvin

    I was under the impression Moores and Moorad only came out with $100 million of the cable monies since they only owned ~50.1% of the team.

    • I’m not sure the exact details but Bill Center mentioned that the minority owners also got a cut and only some of them put it back into the team.

      • SDPads1

        Troy Aikman ran faster than he ever did running from any NFL defense during his career.

      • Troy had a lot of concussions. I wonder who told him to run …

    • Melvin

      I take that back. Moorad and Moores did split all of that $200 million since it was considered part of the team that was sold. The Fowler group got none of it, which makes sense.

      • Minor point (which I keep making like the pedantic broken record I am), but part of the Fowler group, the part that was also part of the Moorad group, didn’t sell their portion. Don’t know what percentage that is, but it was obviously less than 49.9%, as that was everything that Moores didn’t own, and we know that at least Moorad and Aikman sold. So if that percentage was 20%, for example, then the price to the new owners was actually $640M.

        Indeed, Moores did get his full $400M (rounding here), including $100M attributed to TV money. Using the example from above, the Moorad group sellers got $240M.

      • Gloccamorra

        Wait! the dollar value of the sale includes debt, which reduced the cash outlay, since the new owners assumed that debt, reputed to be $200 million. The actual dollars may be hard to figure, but both Moores and Moorad likely walked away with more than they ever put in.

  • Melvin

    I’m going to keep reposting these quotes from Bud Selig until my fingers hurt:

    Selig: “[The Padres new ownership group] knew what part of the sale price was. They felt that, even with that lack of television money, they could run a very good operation. They were themselves very well-financed. With what John Moores took out — because he thought it was part of the sales price — they feel there’s enough other television revenue and enough other income that they can live with it.”

    LA Times: But why didn’t you tell Moores that television money belongs to the team — not to him — and then let him sell the Padres for the best price he could get?

    Selig: “It didn’t matter. It was part of the sale price. The buyer has to make that determination. They made the determination that they like the deal, even with that money gone.

  • Tom Waits

    Ron “Chip Diller” Fowler:

    Remain calm! All is well!