Explaining Southern California's economy

San Diego Padres could be sold for $800 million by the All-Star break

San Diego Padres v Colorado Rockies

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Starting pitcher Anthony Bass of the San Diego Padres. The team could be nearing a sale for $800 million.

That's what being reported, anyway. CBS Sports says that current owner John Moores has entered an "exclusive negotiating window" to sell the team for about twice its current (depressed) value of $406 million — and a lot more than Moores paid to buy the team in 1994, and to start selling it in 2009.

The sticker price is rumored to be $800 million. If the sale — to a group led by the family of former Dodgers owner Peter O'Malley, brewing tycoon Ron Fowler, and other investors including pro golfer and San Diego native Phil Mickelson — goes through, it would make the Padres the third costliest Major League Baseball team acquisition, behind the Chicago Cubs $845 and of course the recent Dodgers sale of more than $2 billion.

It would also mean that the two other potential owners — communications mogul Gary Jabara; and private-equity titan Steve Kaplan of Los Angeles' Oaktree Capital — are out of the running. 

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What's the right price for the San Diego Padres?

San Diego Padres v Colorado Rockies

Doug Pensinger/Getty Images

Starting pitcher Anthony Bass #45 of the San Diego Padres delivers against the Colorado Rockies at Coors Field on April 17, 2012 in Denver, Colorado.

Guggenheim Baseball Management (GBM), fronted by Magic Johnson and financed by the $125-billion Guggenheim Partners investment firm, is buying the Los Angeles Dodgers for a record $2.15 billion. But there's another Southern California professional baseball franchise for sale. Maybe not as storied. But still worth some potentially very big bucks. Will the San Diego Padres see their price rise now that Dodgers have hit a grand slam for their sale?

Quite possibly. But you have to take a few factors into account, as well as assess the probable structure of a future deal. First, let's look at how much of a premium the Dodgers' new owners paid on the team's current revenues. It's steep: in 2010, the team did $246 million, so GBM is paying almost 9 times revenue. That figure will drop somewhat when you factor in a potential $5-billion broadcast deal, to be negotiated in about a year. 

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