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Sources: Mets owners make major moves
The owners of the New York Mets took a series of huge steps toward securing the team’s financial future Monday, starting with their settlement of a lawsuit with the trustee for Bernard Madoff’s victims.
But there was more — much more.
The Mets also raised $240 million by selling 12 minority shares and repaid a $25 million loan to Major League Baseball, $40 million loan to Bank of America and additional club debt, major-league sources said.
The New York Daily News first reported the sales of the minority shares and repayment of the loans. The newspaper said that the team plans to use the money raised from its new investors to help cover operating costs during the 2012 season.
The settlement of the Madoff lawsuit and payment of the loans not only should ease concerns about the ability of owners Fred and Jeff Wilpon and Saul Katz to retain the club, but also could signal the start of the team’s financial recovery.
Jury selection had been set to begin in a civil trial to determine how much the team owners will owe other investors who trusted their money to Madoff, who cheated thousands of investors of roughly $20 billion over at least two decades. But Mets owners and a trustee for Bernard Madoff's fraud victims settled for $162 million in a case aimed at repairing the damage from a massive investment scheme.
The Mets, though, likely will pay only a fraction of the $162 million. They are seeking $178 million in net losses from their investments with Madoff, and believe they might recover at least 70 percent of that figure, or about $125 million, sources said. Such a figure would leave them just $37 million shy of $162 million.
In addition, the Mets are not obligated to pay the remaining sum to the trustee immediately. Fifty percent of the payment will be due in at least four years and 50 percent will be due in at least five, sources said.
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