By now you’ve heard that San Francisco Giants Managing General Partner and CEO Bill Neukom will be leaving that position soon, to be replaced by Giants President Larry Baer. The news broke in a story by Mark Purdy of the San Jose Mercury News around 4 pm Wednesday afternoon. If you haven’t done so already, read Purdy’s story in its entirety. The link is here.
According to Purdy, the Executive Committee of the Giants’ ownership group forced Neukom out after tensions arose over certain financial decisions by Neukom. For their part, the Giants are calling it a “planned transition” by which which Baer will take over day-to-day operations and Neukom will become the Chairman Emeritus. Neukom and Baer will hold a press conference Thursday morning at 11:00 am.
It’s very difficult to believe that Neukom is voluntarily participating in a “planned transition.” Neukom had a very successful career as General Counsel of Microsoft, is extraordinarily wealthy as a result, and genuinely appeared to cherish the role of running the baseball team he has loved all his life. Oh, and he just presided over the first World Series Championship for the Giants since their move out west in 1958. That is not a recipe for a “planned transition.”
According to Purdy, the dispute centers on Neukom’s use of the winner’s booty: the millions of dollars the Giants earned from additional merchandise and tickets sales after the World Series victory.
It wasn’t necessarily that Neukom authorized his baseball people to spend $22 million on a new contract for first baseman Aubrey Huff, or decided to add millions of dollars more to the payroll by trading for New York Mets outfielder Carlos Beltran in July. It was that the Executive Committee believed Neukom, as part of his fiduciary duties, should have consulted with them about his major decisions. Instead, the Executive Committee members were infuriated when they sometimes learned of Neukom’s decisions through news reports.
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Neukom’s falling-out with the Executive Committee, the baseball sources said, began over how to spend the additional millions of dollars that flowed into team coffers after the World Series championship. For example, one source says that since October, the Giants’ merchandising revenue alone has increased by $1.5 million to $2 million per month over previous years. Ticket sales also boomed. The Giants have effectively sold out every game this season.
Neukom, it is said, believed that this was his money to spend as he saw fit — and he did so, increasing payroll and buying new technology for the baseball department, among other expenditures. Instead, the Executive Committee wanted the money to be put in a “rainy-day fund” for use in leaner times.
There’s a great deal of concern tonight in the Bay Area about what Neukom’s departure means for the immediate and long-term future of the Giants. You can read a range of opinions and analyses here, here, here, here and here. I recently wrote a post praising Neukom after the Giants released Aaron Rowand and Miguel Tejada while still owing them more than $15 million on their guaranteed contracts. That was the right decision for team and for the franchise. I hope that decision did not precipitate today’s events.
One interesting piece of the story for me is the role played by Giants majority investors Tori Burns and Trina Burns Dean, the daughters of the late Harmon Burns and Sue Burns. It was Harmon Burns, together with Peter Magowan and Larry Baer, who formed the investor group to buy the Giants and keep them from moving to St. Petersburg, Florida in the early 1990s. Harmon Burns died in 2006 and Sue Burns died three years later, leaving their Giants ownership interests to their daughters.
In the Chronicle’s obituary of Sue Burns, it noted that she was a close friend of Barry Bonds “through his best and worst times.” I remember when the Giants held a special ceremony to honor Sue Burns after her death, Bonds flew in from L.A. to be a part of the on-field activities. I remember thinking about how emotional Bonds appeared to be, how deeply moved he was by Sue Burns’ death, and his clear love and affection for the Burns daughters.
There’s been a lot less of Barry Bonds in the Giants world under Bill Neukom’s leadership. He attended fewer games; made fewer appearances. Granted, Bonds has been busy dealing with his criminal trial and related legal proceedings. But is there more to it? Did Neukom take steps to distance the Giants from Bonds in the wake of the steroids scandal and ensuing indictment and trial? Many have asked why Bonds’ number 25 hasn’t been retired by the Giants and why Bonds hasn’t been inducted into the Giants Wall of Fame. Even Mike Krukow and Duane Kuiper have remarked recently about how much they miss “the big fella.”
I don’t know the answers, but I wonder if Neukom’s apparent effort to keep a distance from Bonds drew a wedge between him and the Burns family. It seems far-fetched that Neukom would be ousted over the team’s relationship with Barry Bonds. But it also seems far-fetched that Neukom would be forced out because he authorized the purchase of additional technological tools to be used by General Manager Brian Sabean’s baseball operations without getting sign off from the Executive Committee. They could all be pieces of this strange puzzle.
I could be way off base on the Bonds angle. Or I could be on to something. We will learn more in the days and weeks ahead.
For now, I share in the sentiment expressed throughout the Bay Area tonight: great surprise over Neukom’s departure and deep concern about the commitment of the Giants ownership group to invest in a winning franchise now and in the future.