Cardinals to purchase AAA Memphis Redbirds

The ink has barely dried on the St Louis Cardinals’ agreement to continue to partner with the Memphis Redbirds as its triple-A affiliate through 2012.

The Pacific Coast League’s Redbirds have been a mainstay in Memphis as the club’s highest level minor league affiliate since the Cards broke affiliation with the Louisville Redbirds (now the Louisville Bats, an affiliate of the Cincinnati Reds) after the 1997 season.

Now comes word that the Cardinals will purchase the Redbirds from the non-profit Memphis Redbirds Baseball Foundation.

From the Memphis Business Journal:

If it goes through, the deal would follow what Dave Chase, president of baseball operations for the Memphis Redbirds, called a growing trend of major league baseball teams buying minor league affiliates.

“The Red Sox have done it, the Yankees are doing it and the Atlanta Braves have been the kings of it, owning all of their minor league franchises,” Chase said.

I could think of a lot worse franchises to model your player development system after than the Braves and Red Sox (the Yankees I’ll leave alone).

The Cardinals already own their affiliates in Springfield, MO and Palm Beach, FL - AA and A clubs, respectively - and are apparently anxious to add the Memphis market to their stable.

More from the Memphis Biz Journal:

Even though the two sides have been discussing the possibility since the beginning of the summer, the deal is far from finalized and the best scenario would have the deal done in a matter of months. However, it must be approved by Major League Baseball, Minor League Baseball and the Pacific Coast League.

There is also the matter of transferring the assets of the non-profit Redbirds Foundation to the for-profit St. Louis Cardinals LP.

So clearly, there are hurdles to be crossed. I’m no expert on the subject, but I would suspect that MLB, MiLB, and PCL approval are a mere formality. Where I could see things getting sticky is in the non-profit to profit transition.

According to the Redbirds Foundation page, the Memphis club is/was the only not-for-profit organization in the country that ran both the baseball club and the facility, AutoZone Park.

The Foundation did a lot of good things in and around Memphis with their RBI program and STRIPES program. I can only imagine that part of the deal will be the Cardinals’ continuation of these great programs, and continued involvement in the greater Memphis community. It behooves the organization to keep close ties with this community, both developmentally and financially.

Memphis is a significant minor league market, one that is unique in its ability to support a minor league stadium the size of AutoZone Park (it seats 12,512 - or approximately 4,000 less than the Florida Marlins have averaged in attendance this season), as well as its proximity to the St Louis market (it is decidedly within the Cardinals’ ‘United Country (State?) of Baseball’). The Memphis Nielsen DMA is ranked 48th in the United States for 2008-2009.

Perhaps just as important as the Memphis market is avoiding the affiliation dance that typically comes along with minor league affiliates. The Cardinals will no longer have to renegotiate a Player Development Contract with Memphis every few years. I have to believe this advantage is more than the casual fan will ever know, staying away from possibly contentious negotiations and contract talks with increasingly profitable minor league team owners.

Indeed, Minor League Baseball has seen a steady rise in both popularity and profitability. While all of the advantages laid out previously are valuable and I’m sure quickly realized, there is another great benefit to this acquisition for the Cardinals. Forbes.com recently ranked the Memphis Redbirds as its second-most valuable Minor League Baseball team.

From the Forbes article:

On average, the top 20 teams are worth $21.2 million and pulled in $9.8 million in revenue per team, of which 49% came from tickets. The great economics of the minor leagues: Player costs–typically between $10 million and $15 million a season for scouting, salaries and bonuses–are paid by the big league affiliates. As a result, margins for clubs that draw well are often fat, and these 20 clubs generated average operating income (earnings before interest, taxes and depreciation) of $3 million.

At number two, the Redbirds are valued at $26.1 million, with revenue of $13.4 million and operating income of $6.9 million. As mentioned in the quote above, one of the great economic advantages of a minor league club is that the big club affiliate is basically paying all of your large expenses - namely, the roster. So it seems like a no-brainer that the Major League clubs would want to own their own affiliates right? Well, I’m certain it is no coincidence that the Springfield Cardinals, also owned by one William DeWitt III, is ranked number eighteen on the list.

I’ve learned a lot about the workings of these deals in a short time tonight. I think long-term this deal is wonderful for the Cardinals both financially and logistically. They have great fan support in Memphis and won’t have to worry about the affiliation dance. Short-term, I think there are still some hurdles to cross with the non-profit to for-profit transaction, and I will be interested to see how that shakes out (and how long a process it winds up being).

Assuming the Cardinals maintain the community presence in Memphis and don’t quickly alienate the fan base already established there, I can’t see this deal as anything but a win-win for the organization.

Here’s hoping this means the youngsters start developing quicker so they can put together a win-win in St Louis…we desperately need a couple…

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On a recap note, Danup over at Get Up, Baby has posted his Top 7 Cardinal Prospects. It is just as good a read as the other bunch posted last week, so check it out.

Filed Under Bill DeWitt, Memphis Redbirds, Minor League Baseball, Non-Cardinals, Pacific Coast League, Palm Beach Cardinals, Springfield Cardinals

2 Comments | Posted on September 17, 2008 by PHE | Subscribe!

UCB: Top 7 Prospects

I was asked to take part in a ‘United Cardinal Bloggers‘ project which tasked several of us Cardinal blog writers to list our top seven prospects in the organization. That was the only instruction, there were no further restrictions. As such, my list follows:

1. OF Colby Rasmus - Obviously, any Cardinal prospect list has to start with Rasmus. 2008 was to be Colby’s first full year in triple-A ball, after a pretty impressive spring training with the big club. Colby started slow at Memphis, as he’s prone to do when moving levels, and just before taking a place with Team USA in Beijing, Rasmus hurt his knee. He rehabbed at the lower levels of the organization to finish off 2008. Many are projecting Rasmus to be with the Cardinals in 2009, further complicating the outfield situation in St Louis. Tony LaRussa’s recent rant about adding ‘impact players’ for next season has raised more speculation than ever that Rasmus may be dealt, but I don’t envision John Mozeliak making that move. The Cards haven’t had such a highly touted youngster in my recent memory, and I just can’t see Mo shipping him away without just a ridiculous return in trade.

2. 3B(?) Brett Wallace - I really hope that the Cards give this guy a chance to stick at third base. He’s been playing there for years, why is it all of a sudden incomprehensible that he could play third for many years going forward? Yeah yeah, I know, Major League Baseball is a totally different game than college. But figure that he played the hot corner at Arizona State with aluminum bats rapping baseballs his way, and he managed fine. Anyway, soapbox aside, Wallace is a hitter. Wherever he winds up fitting in on the field, the guy can rake. He tore up pitchers in the Midwest League putting up .327/.418/.490 for Quad Cities. He got a call to Springfield for their playoff push, and proceeded to do even better there at .367/.456/.653 in 49 at-bats. Wallace could well be a defensive liability no matter where the Cardinals finally land him, but his bat should more than make up for that liability. I wouldn’t be surprised to see Wallace start next season at Memphis, furthering the 3B logjam in the upper levels of the organization.

3. C Bryan Anderson - Anderson has hit at every level he’s played. His defense has always been his question mark. A bit of a slump late in the season at Memphis dropped his average, but Anderson has been around .300 or better for his entire minor league career. I give him a little extra boost for the purpose of this ranking, because Anderson right now is probably the Cards’ most marketable talent in the minor leagues, at a premium position nonetheless. The Redbirds obviously have an entrenched incumbent at the catcher position in the big leagues, with Yadier Molina obviously having staked his claim, especially after a fantastic offensive campaign this year. Would Yadi’s stranglehold on the position be weakened at all if LaRussa was no longer managing the club? Doubtful, especially if he can continue to hit like he has in 2008, but it’s worth discussion. I would love to see the Cards have Anderson apprentice a season as Molina’s backup before trading him, just to see what they really have in the kid - but I realize that if he were to struggle, his trade value drops. Will be interesting to see if Anderson is still with the organization come spring.

4. CL Chris Perez - Perez now has a few chinks in the armor, as he’s been roughed up recently. His slider still needs work. His control still needs work. His fastball still gets up on hitters at 98 mph. Given the opportunity, he will be a nasty closer for the Cardinals in 2009 and beyond. I see Perez chiming in for 30+ saves for many seasons with the Birds. Assuming that someone finally stops Dave Duncan’s reliever-to-starter conversion machine from taking over the world, envision a Kyle McClellan, Jason Motte, Perez back end of games for the next bunch of seasons. I like the sound of that.

5. OF Daryl Jones - Prior to this season, Jones surely would not have registered on a list like this. Always a ‘tools guy’ who had never really put it together, Jones had a monster year between high-A Palm Beach and double-A Springfield. This breakout season for Jones is helping to reinforce the organizational approach to the draft and minor leagues under the watch of Jeff Luhnow. Drafting guys who are athletic and have a skill set that they hope can be coached into statistics hopefully will continue to pan out with guys like Jones and Pete Kozma (still holding out hope on that guy).

6. SP Jaime Garcia - Tough break about Garcia’s elbow. I have some growing concern about the prevalence of injuries to Cardinal pitcher arms, but that’s a topic for another time. The ‘Tommy John Surgery’ procedure has come a long way, and it’s been said that a TJ can sometimes add velocity for a pitcher. Again, not something you’d choose to go through just for that, but if it has to happen, might well look on the bright side of it? Garcia was a leading candidate to pick up the fourth or fifth spot in the Cards rotation for next season. He was probably rushed to the bigs this year as a necessity, but certainly could’ve been ready as a full-time guy next season.

7. OF Jon Jay - Jay had a bit of a hiccup at the plate last season when he was promoted to Springfield, but impressed enough there this season to earn a call to Memphis where he showed even better. The organization is seemingly deep at the outfield positions, so it should be interesting to see what happens personnel-wise in the next season or two - Mozeliak may be in a position to position-shift some of his better young talent. Jay flashed more power this season than he had shown in previous seasons, perhaps at 23 growing his body into his talent.

Near misses: 3B David Freese, RP Jason Motte, SS Nico Vazquez

It sure is fun to be able to undertake a project like this and have something to write about. I’m not sure I could’ve said the same a few years ago. Thanks to C70 for the invite to take part in this gig, I look forward to future UCB projects.

Check out the other entries by following these links: C70 at the Bat, CardinalsGM, Future Redbirds, Get Up Baby, Mike On The Cards, The Redbird Blog, Redbird Ramblings, Rockin’ the Red, and Viva El Birdos.