Cain and the D-gers Record Sale Price

OK, now things are starting to get clearer for me now, shame on me for not connecting the dots.  Cain's agent is probably salivating about the D-gers big money cache coming as soon as the new owners sign the dotted line:  rumors had Fox offering McCourt something like 10 years at $150M per year, giving the D-gers as deep a pocket as the Yankees and Red Sox, at least $100M per year extra to spend on players.  Schulman clued me in on this concept with his blog post on the sale.

That is why the winning bid of over $2B by the group led by Magic Johnson should not have been surprising, with all that loot coming into their coffers soon, that justifies the high valuation.  And McCourt, who didn't have enough money to buy the D-gers in the first place, leveraging up the team massively, walks off with at least $1.5B for his troubles, thank you MLB and Bud Selig.  Heck, the Chavez Ravine real estate alone pays off his divorce settlement with his ex-wife, and he even keeps a share of that going forward (well, he has to find something else to do now that he has $1.5B to play with) along with pocket change (well, for him, "just" low tens of millions) after the divorce settlement (Jamie probably had one of the most expensive affairs ever, if she had stuck with him, she would be luxuriating in these riches too, though perhaps McCourt might have kicked her to the curb once the money started rolling in, some rich guys do horrible things like that once their wealth takes an exponential leap; but at least in that case, she probably would have gotten more out of any divorce).

One point that Hank did not expand enough on, so the ordinary fan might not fully understand, is his comment about the Giants getting richer.  Yes, the owners are now richer:  on paper.  The team can't really access that extra valuation on the team unless a bank is willing to loan them money, and even then, they have to pay it back eventually plus there are MLB rules on how much debt you can take, plus most of all, they still have the debt on the stadium.  I suppose the team could sell off additional shares of the team (any owner selling shares would get the money, not the team), but not enough to make up $100M extra spending by the D-gers going forward.

And thus the Giants are actually screwed right now.  According to what Ray Ratto noted in his stint on KNBR yesterday on the Razor and Mr. T show (I'm still amazed they go with this name for the show), the Giants are signed with CSN for the next 10 years, presumably at the price they signed on for when they signed the contract (Ratto also noted that the debt should expire after 2016 season, as he noted that the loan was taken in 1997; I recall another source mentioning 2017, however; at that point, the Giants would have roughly $20M more to spend each season).  Although at least the team owns a significant portion of CSN Bay Area, around 30-35% from what I recall, I doubt that CSN Bay Area passes on their income to the Giants regularly, and even if they did, it would not be $100M per year, especially since they only own 30-35% of this sporting network.

So I have to think that the stall was on because the agents set the price very high, due to the possibility of a new D-ger owner soon, and the Giants stalled too, to see what they are really going to be up against with the new D-ger owners, but mostly because the agents were asking for the moon.  And I have to agree with Schulman that, yes, Matt Cain just got a lot richer today.

He still thinks that the Giants will sign Cain to a contract.  I hope he is right.  I was hoping to hold off with a 5 year, $100M deal, but I think $115-125M is now probably where they will have to go to get Cain to sign on a deal.  I think Ratto said $110-115M, but at $120M, that works out to $24M per year, which is top money area (CC and Cliff), and per DrB's prescription of paying more per year to get a shorter contract, that's probably what's going to have to happen to get the deal signed.

Per the good points that Kawakami noted in his blog post about why signing Cain is so critical for the Giants, which Shankbone was kind enough to point out in the comments to my last post (thanks again!), the Giants really have to sign Cain for the team to look competitive in the coming years.  He is a linchpin for any Giants competitiveness going forward, as without him, then Lincecum is probably gone too (for sure, instead of maybe staying). 

But giving Cain top money would then mean giving Lincecum record settling money, $26-30M per season.  At that price, I hope Lincecum is still looking only for 2-3 year deals, as no team can afford the risk inherent with that, except for maybe the Yankees, Red Sox, and now the D-gers.  Lot of business risk the Giants will have to face in the coming years in order to keep the Giants in the running for Team of the Decade, but it looks like no other way other than to bite the bullet and hope that Shankbone and Tom Seaver are right that both Cain and Lincecum are horses built for the long-term.

Either way, the Giants should probably be picking up mostly starting pitchers going forward with their first round picks, their starting lineup is starting to look pretty good going forward.  Posey, Belt, Panik, Sandoval, Crawford in the infield, maybe Melky, Brown, Peguero (or Schierholtz) in the outfield, as I can see the Giants wanting to sign Cabrera should he have another season similar to his 2011 season, particularly since we don't really have any other OF looking like he'll be a starter, though Blanco might also be a possibility if he has a good 2012 season.  I doubt Melky can repeat his 2011 season, but if he can be close to that, they will probably want to keep him around longer.  Even if he is close to his 2009 form, they will probably still try to keep him around longer, just not for as much money.