Third in a five-part series on the new Marlins owners and their plans.
Marlins co-owner Derek Jeter eventually will make back his modest financial investment in the team merely through the salary he is being paid as the team’s chief executive officer.
But he could be paid substantially more than that if the team makes a profit.
According to an August version of Project Wolverine - a document pitching potential investors on joining the Marlins ownership group and shared with the Miami Herald by sources - Jeter will make an annual bonus based on the Marlins being profitable.
That bonus would pay him $2 million in 2018, $1.7 million in 2019, $1.1 million in 2020, $2 million in 2021 and $2 million in 2022. The Marlins declined to say if the amount of those bonus payments were altered in subsequent versions of Wolverine.
Project Wolverine projects the Marlins will have a $68 million profit in 2018 (though it would drop to $23 million without a large projected up-front payment from Fox on a Marlins-proposed contract extension). Wolverine projects a $10 million profit in 2019, $15.8 million in 2020 and $22 million in 2021. Those figures are based on projections that include sharp rises in attendance and sponsorship revenue.
What’s more, Jeter is being paid $5 million annually as CEO. Jeter declined to confirm or deny a report that he has an unlimited credit card for Marlins-related expenses including travel from his Tampa home, which isn’t mentioned in Wolverine.
It is not unusual for a CEO to make a salary similar to Jeter’s $5 million. But the fact Jeter is one of the team’s owners makes that salary notable.
The high salary also leaves Jeter vulnerable to criticism from fans that are angry about the team trading Giancarlo Stanton, Marcell Ozuna and Dee Gordon – trades that have slashed $36 million off the team’s payroll.
Though numerous reports have said Jeter invested $25 million in the team – and one potential investor said he was told that, as well – the paperwork submitted to Major League Baseball in August lists Jeter’s percentage at 4.81 of the team’s $790.5 million in common equity. So Jeter essentially told MLB during the approval process that he’s putting in $37.9 million, though that figure could have been adjusted in recent months.
That official report given to MLB owners - a second document that was shared with The Miami Herald by an MLB official - lists Jeter as having the sixth-largest stake in the team – behind Naples financier Bruce Sherman (44.3 percent) and businessmen David Ott (9.5 percent), Doug Kimmelman (8.4 percent), Jaime Montealegre (7.1 percent) and John Troiano (5.3 percent).
That official report submitted to baseball includes 18 people with a stake in the Marlins, but only two who would be household names: Jeter and NBA legend Michael Jordan, who invested $5 million (or .63 percent of the common equity).
In addition, Michael Dell has $85.8 million in preferred equity in the team, according to the document. Dell has the contractual right to get his money back after five years if he wishes. The team also has $400 million in debt, which isn’t unusual in team acquisitions.
Jeter wanted to be the "control person," but an MLB official said Jeter was told he had too little money invested for that to happen, which irked him. As a result, Sherman ultimately had to be the control person.
But Sherman has given Jeter the authority to run the team – quite a coup considering Jeter’s modest investment and potential to make all of that investment back in salary and bonuses within a decade, if not sooner.
So what’s it like working for Jeter? A Marlins person who worked for both regimes described him as a good listener but said it’s a lot more difficult to get to Jeter than to previous top executives. Jeter has a chief of staff, Caroline O’Connor, who follows him around, diligently taking notes.
The Marlins owners are seeking another $200 million from new investors, partly because some of the 18 investors would like to lower their own investment, according to a source.
The Marlins declined to make Sherman, Jeter or anyone else available for comment for this Herald series.
Here’s part 1 of this series on the Marlins’ private revenue and profit projections.
Here’s part 2 of this series on the Marlins’ planned payrolls for the next decade.