Fitch: MLB Can Afford Lost Season

Negotiations often come down to who has more to lose. A report from Fitch Ratings finds that MLB owners could weather a full season without baseball.

MLB’s “ample liquidity position” at the end of last month and debt reserve funds can cover the loss of a full season, the financial analyst wrote.

• Potential losses in 2022 could be covered by ticket revenue and media deals, Fitch noted.
• The league can draw up to $2 billion from its A-rated MLB Club Trust Securitization and $1.25 billion from its MLB Facility Fund, which holds an A- rating.
• MLB holds around $2.1 billion in debt from those two facilities.

Fitch did caution that a lengthy lockout could “alienate the fan base and erode game attendance and viewership,” leading to “lower renewals of key revenue, including club seats, luxury suites, and sponsorship agreements.” 

Winning by Losing?

Last week, MLB told MLBPA representatives that it would be willing to lose a month of games, which some players believe is a desirable outcome for team owners. April games are poorly attended, and media deals are not broadly affected until around 25 games are lost. 

“They continued to make offers they know were in the players’ best interest to refuse,” Chicago Cubs outfielder Jason Heyward wrote in an Instagram post. “They view the first month of the season as debt … season delayed [equals] they meet their goals.”

On Friday, the MLBPA announced it was launching a $1 million fund to support workers affected by the lockout. MLB said it would create a similar fund.