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Mets get good news with loan, which means good news with payroll

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Saul Katz and Fred Wilpon. (Getty)

The New York Mets biggest victory of 2014 has come long before opening day and happened nowhere near a Major League Baseball diamond. It has to do with a $250 million loan that owners Fred Wilpon and Saul Katz have hanging over them. The loan is going to be refinanced, which includes removal of restrictions on how much the team can add to payroll.

They finally can see light at the end of the tunnel and it’s not the No. 7 train.

Mets partners were among a long list victimized by Bernie Madoff’s ponzie scheme. Cash flow has been a problem ever since — with stopgap loans being required and many favors cashed in, putting current ownership in peril of losing the team. As a result, the team’s payroll, about $140 million in 2010, is going to be about $93 million in 2014 — which would rank 24th out of 30 teams.

The New York Post published details Thursday night about the loan refinancing that includes phrases one should never read in a baseball story. They include: “This will be oversubscribed,” and “The rate will likely end up at Libor, plus 300 basis points.”

So Libor is one of the guys competing for the starting shortstop job, or?

The Post writes:

Until recently, it wasn’t certain investors weren’t going to insist the team owners pay down some of the loan to get the refinancing done.

Wilpon and Katz will not be asked for any cash paydown, sources said.

Plus, interest payments are expected to stay about the same, a source with direct knowledge of the situation said.

The rate will likely end up at Libor, plus 300 basis points, or a shade under 4 percent, a source said.

The seven-year re-fi will give Wilpon and Katz much- desired financial breathing room, sources said.

For the longtime friends and team owners, it is perhaps the best outcome they could have hoped for.

For Mets fans hoping for new ownership to breathe new life — along with some power and pitching — into the line-up, perhaps the news is less thrilling.

So cynical, one paragraph at a time! Without the refinancing, a big cash payment on the principal — perhaps an “insurmountable” one — was coming in the spring. This gets Wilpon and Katz off the hook for that. It buys them more time to own the team and make it competitive again. That’s good news, unless you wanted them to have to sell the team. Are there people out there who want the Wilpons to sell the team?

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Sports & RecreationNew York MetsFred WilponSaul KatzMajor League Baseball […]

New loan could end Mets money problems

The Mets’ owners appear to be on the verge of finally putting the team’s financial problems behind them, The Post has learned.

Cash-strapped Fred Wilpon and Saul Katz, who faced perhaps an insurmountable spring principal payment on their $250 million loan, are close to refinancing the note, sources said.

“This will be oversubscribed,” a source considering investing in the Bank of America refinancing said.

The re-fi — the biggest off-field hurdle the team faced this off-season — will likely close in February or March, the source said.

Until recently, it wasn’t certain investors weren’t going to insist the team owners pay down some of the loan to get the refinancing done.

Wilpon and Katz will not be asked for any cash paydown, sources said.

Plus, interest payments are expected to stay about the same, a source with direct knowledge of the situation said.

The rate will likely end up at Libor, plus 300 basis points, or a shade under 4 percent, a source said.

The seven-year re-fi will give Wilpon and Katz much- desired financial breathing room, sources said.

For the longtime friends and team owners, it is perhaps the best outcome they could have hoped for.

For Mets fans hoping for new ownership to breathe new life — along with some power and pitching — into the line-up, perhaps the news is less thrilling.

There is a bit of a silver-lining for critics of Wilpon and Katz: There are no payroll limits written into the re-worked loan, a source added.

The existing loan restricts the team from greatly expanding payroll.

For 2014, the Mets are expected to slightly increase payroll to more than $90 million from $85 million.

The Mets spent $87 million in the off-season signing Curtis Granderson, Bartolo Colon and Chris Young.

Mets sources believe payroll will increase slowly in coming years, but probably won’t get back to 2010’s $140 million level anytime soon.

The Mets — which still have to make their interest payments — lost more than $10 million in 2013.

Depending on attendance and payroll, the team could turn a profit this year since the value of a new national TV deal jumps by $25 million per team.

Mets attendance has fallen for five straight years. Last year they drew 26,695 fans per game.

Still, this is quite an Amazin’ comeback for the Mets, who didn’t have the cash to make revenue-sharing payments in 2010 and 2011 — forcing them to borrow $65 million from Major League Baseball and Bank of America, sources said.

“The fact they are still here after Madoff is a miracle,” a sports industry source said, referring to the financial hit Wilpon and Katz took in the Madoff Ponzi scheme.

In 2012, the Mets were able to raise $240 million by selling 40 percent of the team to a group of minority investors that included hedge-fund honcho Steve Cohen and comedian Bill Maher.

The minority stake sales allowed Wilpon and Katz to pay off MLB and BofA. In addition, the partners paid more than $100 million toward $430 million of team debt that they are now in the process of refinancing.

A Mets spokesman declined to comment.

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