Re: Here's an idea for Henry...
posted at 4/9/2012 4:27 PM EDT
In Response to Re: Here's an idea for Henry...
[QUOTE]In Response to Here's an idea for Henry... : Forget that, sell the Sox to someone else! To people that don't think one effects the other....seriously? The Sox, now, are part of a portfolio including at least a soccer team and Nascar team. ALL effect each other. ALL draw from the same pot of funds. Do you really think the tens of millions spent recently on the soccer team doesn't effect the baseball team? If you honestly believe that, then tell me why they dumped Scut to save about 4 million. Anyone, please, explain that garbage to me. On the one hand people harp "baseball is a business" and then ignore this very real business side of it??? Oh my head, wow. Just like Steinbrenner used to peel millions from his ship building company to spend on the Yankees, Henry stopped spending on the Sox this year to spend it elsewhere. It's not that hard to figure out or see. It's actually painfully obvious. Unless, of course, you simply believe what these disingenuous owners have to say...then, it's not worth discussing. You beleive Henry when he said the players weren't out of shape last year. you believed Francona actually resigned.
Posted by ma6dragon9[/QUOTE]
Are you serious with this? You need to go to business school pal. Your hatred of Henry has seriously warped any business sense you might have had -- assuming you've ever had it.
Last thing first -- if Steinbrenner used Shipbuilding money for anything other than to buy the Yankees, it was in the early years while he sured up revenue the Yankees revenue streams.
Pay attention to the Red Sox. Over the couse of the past 10 years, the payroll has increased as Henry built up more Red Sox revenue streams. And he's doing the same with the soccer team, suring up its own revenue streams. At the end of the day, the one business unit as a final profit or loss statement. But in running the business, they don't draw from the same pot. That's a stupid way to run the business.
Each business unit has its own budget based on the revenue that particular unit generates. Now, in a publically owned corporations, if one unit continually loses money, other units often are forced to make up for it to maintain profit margins to keep stockholders happy.
But the Fenway Group isn't a publically traded corporation, so it doesn't have that stockholder pressure to maintain the stock price.
Now of course, if one segment of a business that has various units is doing so bad that i becomes a significant drain on the overall business, then yes, it can affect the other units. And -- if this is what you mean by all the money is in the same pot -- a business might use profits (PROFITS) from another unit to invest in another segment of the business so shore up that unit. That's simply good business to make the entire company more profitable.
Good business men, however, don't weaken one unit in the process of helping another once. That's a shortcut to disaster. Say what you want about Henry but he has yet to show he's not a smart businessman.
But assuming what you say is true, that the soccer team has affected the Red Sox -- HOW? Please document how the soccer team is doing so bad financially, it's syphoning money from the Red Sox. Just because you make a scenario for your own fantasy world, it doesn't make it true.
Is your best argument -- dumping Scutaro.
To answer your question, they dumped Scutaro because they don't want to be over the threshold so they're trying to stay as close as they can to the threshold. That would be true with or without the soccer team -- probably even more so w/o the soccer team.
Answer me this -- why are the Yankees also trying to get under the threshold?
The penalty for being over the threshold is bad business regardless of the portfolio.
What many overlook is how having more than the Red Sox as part of the Fenway Group can help the team.
If Henry and the other Fenway Group investors want to make a profit of $40 million dollars -- just to throw out any number -- from the business, having more units in the group can help the Sox. Instead of the pressure to make the entire $40M profit from the Sox, they can spend more on the team and take less profit because they have other units that can contribute to the overall bottom line.
I don't know if that's their mindset, but other than your whining, you have yet to present anything that shows owning the soccer team has hurt the Sox.