Muckety
 
 
 
 
 

Goldman Sachs cash wends its way to the AL playoffs

By A. James Memmott

October 13, 2008 at 8:35am

Using some of a windfall sent their way in by the man who is now the U.S. Treasury secretary, a group of Wall Street veterans are getting to see at least one of their investments pay off.

Stuart L. Sternberg and five other former associates at an options trading firm paid a reported $60 million for a 48 percent stake in the then Tampa Bay Devil Rays in 2004. (The team is now just the Tampa Bay Rays.)

At the time, the purchase seemed risky - the team wasn’t winning and the fans weren’t coming out - but Sternberg was confident.

“I’m a buy-low guy,” he later told The New York Times. “And if you pay the right price for something, I don’t care what it is, you can’t go wrong.”

Looks like he was right.

The Rays, the worst team in Major League Baseball last year, are currently tied at one game apiece with the Boston Red Sox in the American League championship playoffs.

The best-of-seven series resumes tonight in Boston.

The Rays’ presence in the series can be attributed, in a roundabout way, to what some say was a mistake by Goldman Sachs Group Inc. in 2000.

Goldman then paid $6.5 billion for Spear, Leeds & Kellogg, an options and stock trading firm where Sternberg was part of management.

Henry M. Paulson Jr., then the CEO of Goldman and now the secretary of the U.S. Treasury, was faulted on the purchase price, which many analysts said was too high.

Nonetheless, it made millionaires of several people at Spear, Leeds & Kellogg.

The new mega-rich included Sternberg and his five co-investors in the Rays, Gary F. Goldring, Andrew Cader, Randy W. Frankel, Timothy R. Mullen and Stephen M. Levick.

Sternberg, 49, joined Goldman Sachs after it bought Spear, Leeds. He stayed for two years before leaving in 2002, walking away with a reported $400 million.

A lifelong baseball fan who coached his sons’ Little League teams and still has season tickets to the New York Mets, Sternberg jumped at the chance to buy into the Rays.

In December 2005, his role with the Rays expanded when he took charge of the team as managing partner.

He immediately shook up the front office, filling key posts with young executives who had far more experience trading stocks and bonds than baseball players.

“On Wall Street, you want younger, hungry people out there,” Sternberg said, explaining his staffing decisions.

A Sternberg protégé, Matthew P. Silverman, 33, serves as the Ray’s president. An economics graduate of Harvard University, he had worked on mergers and acquisitions at Goldman Sachs before coming to the team.

He and Sternberg had met at Goldman Sachs and spent more than a little time talking baseball.

Andrew W. Friedman, the Rays’ executive vice president of baseball operations who serves as general manager, also came out the finance industry, having worked at the former Bear Stearns Companies Inc. and then at MidMark Capital, a private equity firm.

Follow Muckety on Twitter Tweet This! Share on Facebook

Click here to sign up for the Muckety Newsletter

 Read related stories: Business  

0 Comments

  • There are no comments yet, be the first by filling in the form below.

Leave a Comment

The relationship map to the left is interactive.
• Solid lines are current relations. Dotted lines are former relations.
• Expand items with + signs by double-clicking or by selecting multiple items in the map and pressing the "e" key.
• Move an item in the map by clicking and dragging.
• You can also delete items, separate boxes and save maps. Right-click on the map or select Map Tools for these options.
• Find out more about an item in the map by right-clicking on the item and choosing Information about...
• View map color key.
• This interactive map requires Flash player.


Become a fan of Muckety on Facebook

  • Search for stories
      
    Special Features

Follow Muckety on Twitter Follow Muckety on Twitter
Muckety has no direct connection to most of the people or organizations listed on these pages.
We are unable to forward personal messages or provide personal contact information.
We make every effort at Muckety to ensure that our data is correct and timely. However, relationships are in constant flux and we cannot guarantee accuracy. If you come across incorrect or outdated information, please let us know by email.
© 2017 Muckety LLC