The Athletic reported a weird story yesterday, citing “sources briefed on the matter but not authorized to discuss it publicly,” that Chicago White Sox owner Jerry Reinsdorf is discussing selling the team he’s owned since 1981. According to the article, Reinsdorf in “in active discussions” with a group led by former MLB pitcher Dave Stewart and player agent Lonnie Murray.
Why is it weird? For one thing, the 88-year-old Reinsdorf has previously said he planned to hold on to the team as long as he was alive, leaving it to his heirs to figure out what to do with it afterwards. (Though he’s the White Sox principal owner, Reinsdorf reportedly only owns about 19% of the team.) But also, Stewart and Murray almost certainly don’t have anywhere close to the couple billion dollars or so it would take to buy the White Sox; on top of that, they don’t have any particular ties to Chicago, with Stewart previously having helped lead efforts to get an expansion franchise for Nashville.
It’s certainly possible that Stewart and Murray, who would become the first Black majority owners in MLB if they bought a team (and could raise the funds to be the majority owners), figure that buying a team in Chicago would be a faster and more certain route than waiting for the possibility of one in Nashville. Or it’s possible that they have designs on buying the White Sox and moving them to Nashville, though that would seem like an expensive way of going about it, given that Chicago is the nation’s #3 media market and Nashville is #27.
Or, given that this came out of nowhere based on unnamed sources and that Reinsdorf has previously played footsie with Nashville to try to scare up public stadium funding in Chicago and that is literally his signature move, maybe this is Reinsdorf himself leaking news of the sale talks to kickstart talks about his $2 billion Chicago stadium funding demands? There’s no way to be sure without knowing who the Athletic’s Brittany Ghiroli heard this from — even then it might not be possible to know who if anyone directed them to spread the rumor, but at least if we had a name we could make an educated guess. Unnamed sources really are bad for humans and other living things.
Is Dave Stewart giving permission for his name to be attached to this rumor as a favor to Tony LaRussa? Maybe TLR is the source.
Okay, forgive me for not knowing this, but time was that if a rich old team owner died, their family would get stuck with a huge tax bill, forcing them to sell the franchise. (This was what happened with Joe Robbie, right? And how Wayne Huizenga ended up with the Dolphins?)
Did they do away with that? Would his heirs merely have the hassle of disposing of the asset at their leisure (not knowing what estate planning they have done to this point)?
I guess “hassle” might not be the right word when you have a $2B asset that most of us will never have to deal with when a parent or grandparent passes, but I honestly don’t know if inheritance taxes on something like a team worth $2B are no longer a thing.
If we were talking about $10,000 of stock bought for $1,000, the heirs would be able to step up the cost basis to the value when they inherited it ($10,000). If they then sell, they would not have to pay tax on the $9,000 gain. I don’t know how this applies to an asset worth considerably more. There might be a limit to how much the cost basis could be adjusted.
This happened when the Orioles were sold. The deal was put in place, but the team was not sold to David Rubenstein until after Peter Angelos died. That probably saved Angelos’s heirs a lot of money (the 2024 sale was $1.7 billion, compared to the 1993 sale to Angelos for $173 million).
https://www.investopedia.com/terms/s/stepupinbasis.asp
You’re right that the cost basis for capital gains tax adjusts to the value when the owner dies but the estate tax is still there. The Bush Jr Tax cut had phased down the estate tax so that it was 0% the year George Steinbrenner died but that expired after that year. I am not sure what it would be now
This sounds like a phoney story to gin up support for taxpayers “giving Jerry what he wants.” We’ll likely see some dopey Sox fans start “Save our Sox! Don’t let them go to Nashville!” And enough stupid politicians may fall for it , to give Jerry a new stadium.
Stewart has wanted a team for a while and if he can get control of one by buying less than 20% of one its a smart play. He seems to be agnostic where it is. Now that doesn’t mean he wouldn’t try and move it if he can’t get a stadium deal in the future. Its not clear yet who approached who here.
The White Sox are an attractive target for moving for the same reason as the A’s. It’s much more difficult to get a big public money giveaway for a new stadium when your team is only the “spare team” in its own market. Might be easier to get a bundle of public money from a state that doesn’t yet have MLB.
Yeah but where? Nashville isn’t a viable MLB market and isn’t an attractive “what if” the way Vegas is.
Oakland is an established market but will not allow itself to be used like that after what it went through with the As. Portland isn’t big enough and will never support the MLB. Out of the Canadian cities, only Montreal would make any sense. So that leaves Sacramento, San Antonio, Nashville, Orlando, and maybe Indianapolis or Charlotte.
Nashville isn’t big enough and is already saturated. Orlando definitely makes no sense. Indianapolis is an attractive option given their love of sports and funding stadiums as well as the Midwest’s love of baseball but I’m not sure it’s big enough as a metro.
San Antonio is definitely a potentially viable MLB market given its size, fast growing population due to its proximity to Mexico, how big Texas is, and the fact that they have no NFL or NHL team and are unlikely to ever have one. I think it’s an inevitable MLB market but I think it will be an expansion market.
So that leaves Montreal and Charlotte. Well it’s hard to see Montreal throwing money at any team to relocate and promising public funding for any new stadium unless given an expansion team by the MLB so they’re unlikely. The only thing that makes them likely imo is the fact that the Sox are an AL team, and I would think Montreal would be as well so they can have a real rivalry with Toronto.
That leaves Charlotte and maybe Indianapolis due entirely to Indiana bordering Illinois and already supporting some Chicago teams near the border. I think Charlotte could be a viable option. It’s a huge metro with a lot of money and history, and they can pull from both Carolinas for their fanbase. Yet I don’t recall Charlotte ever clamoring for an MLB team.
Jerry played himself. It’s possible one of these cities in fact tries to lure the Sox there but it’s nowhere near the slam dunk that the expansion cities of the ’90s were. Even if the Sox did move to Nashville, they’d never be successful in building an actual fanbase there.
Nashville will never support the MLB. They aren’t a big enough metro, and their sports market is already completely saturated with two major pro teams and a major college football program. Plus don’t they have a current or future MLS team?
It really annoys me seeing people agree that stadiums built in the ’90s need to be replaced. I get it for arenas because they’re enclosed and harder to overhaul but outdoor baseball and football stadiums shouldn’t be that difficult to upgrade with new luxury boxes and other things. Reinsdorf isn’t even trying but what should I expect from the guy who infamously got his current stadium by threatening to move to a number of what are now current MLB cities.
That’s the thing though. What’s left? San Antonio? Nashville? Maybe Sacramento or laughably Oakland? Vegas and the other major metros are already taken. The only one that even remotely makes sense is San Antonio, and I’m sure the MLB would rather collect expansion fees when they inevitably put a franchise there.
There’s only one metro left to hold cities hostage with, and Nashville ain’t it. There’s no way the MLB thinks Nashville will support baseball unless they’re stupid. It’s literally the hardest major sport to build support for in a non traditional baseball market by far. I understand chasing Vegas dollars even though I guarantee you the As and any other team will absolutely fail in Vegas because they will never be a viable MLB market. I don’t understand Nashville. At all. If anybody should get an MLB franchise next, it should be Montreal after what the MLB put them through. Maybe some owner will use that metro as leverage but I highly doubt it considering it hasn’t happened in all this time since the Expos left.
All the scenarios I’m reading look like they’re from a time warp.
Nashville not big enough? The region has exploded in population and has 3 (not 2) big-league pro teams. Add Vandy and the UT Vols and it’s major-league ready. Only concern for baseball is finding the land to build a ballpark seating 30,000 or so.
San Antonio? 2nd-largest city in Texas can only support Double-A minor league ball — a city that’s been eclipsed in stature by nearby Austin.
Montreal? Not happening, especially with national elections expected in Canada next year. Quebec nationalists control the provincial legislature and have a sizable voice in Ottawa.
As always, nobody takes into account the lack of local TV money thanks to the collapse of regional sports networks.