Cardinals team purchased by holding company

Dan Reiter expects DBH to bring innovation and new technology to the Cardinals.

John Mozeliak: Springfield is important to MLB Cardinals' identity as a regional branding franchise.

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The St. Louis Cardinals have sold the Springfield Cardinals, the Double-A franchise that calls Hammons Field home, to Diamond Baseball Holdings LLC, making the Springfield squad the 18th team in the DBH portfolio.

The terms of the sale announced May 1 were not disclosed. A news release from the city of Springfield stated the transaction is expected to finalize soon.

The team has two standing commitments that tie it to the city of Springfield: a professional development league license with the St. Louis Cardinals through 2031 and a 15-year lease agreement attaching it to Hammons Field through 2038.

Dan Reiter, general manager of the Springfield Cardinals, said the team is not going anywhere, and he added the sale to DBH opens up new possibilities locally.

“We’re looking into multiple avenues for future growth,” he said, noting opportunities ranging from ticketing to fan experiences but declining to disclose details. “You don’t want to tip your hand, but I can tell you I have heard multiple discussions of partnerships that would be very, very exciting.”

Reiter said one of the key differences between MLB and Minor League Baseball is that the big-league staffs are large and specialized in every category. By contrast, MiLB staff members wear many hats.

“They want to create expertise within the minor league system,” he said of DBH. “What they’re looking to do is to change the minor league landscape forever.”

Innovation
The acquisition announcement made at Hammons Field came just months after Springfield City Council approved the purchase of the stadium. The $16 million deal also included the purchase of adjacent parking lots, as well as $4 million in planned investments to the facility, as required by MLB.

“This is the year of big Springfield Cardinals news dropping,” Reiter said. “We are still the Springfield Cardinals. The team remains the same; the name remains the exact same, except, of course, those few days that we are the Springfield Cashew Chickens.”

For a handful of games this season, the team will wear uniforms with that alternate identity, though that is unrelated to the sale – a fact that was a curve ball for some speculating fans on social media prior to the news conference announcement, Reiter said.

“We are still the Double-A affiliate of the St. Louis Cardinals, and they will continue providing that amazing on-field talent that we’ve grown to love,” Reiter said.

He added staff and leadership at Springfield Cardinals and Hammons Field will remain the same under the new ownership.

DBH did not send a representative to the news conference, though someone from the holding company was present in the ballpark that week to orient the staff to new business operations and software. Reiter said DBH would propel the team forward with innovation and new technology.

Diamond Baseball Holdings
The new owner of the Springfield Cardinals is a holding company founded in 2021 that also owns the Memphis Redbirds, the St. Louis team’s Triple-A affiliate.

A sampling of its other holdings, per baseball stat website Baseball-Reference.com, include the Iowa Cubs, the Chicago Cubs’ Triple-A team; the Scranton/Wilkes-Barre RailRiders, the New York Yankees’ Triple-A team; the Hudson Valley Renegades, the Yankees’ High-A team; and the San Jose Giants, the San Francisco Giants’ Low-A team.

Baseball Reference states DBH “jumped from nowhere in the world of professional baseball to the largest operator of Minor League teams at the end of 2021.”

The holding company was originally owned by Endeavor, a worldwide sports and marketing company that provided agent representation to MLB players. At a threat of decertification due to conflict of interest, Endeavor sold DBH in August 2022 to Menlo Park, California-based private equity firm Silver Lake Partners for $280 million, according to Baseball Reference.

Silver Lake’s financial filings at the end of 2022 showed it with a 31.5% stake in Endeavor.

DBH came on after MLB’s 2020 restructuring of Minor League Baseball that cut the number of affiliated teams to 120 from 160, according to Baseball America. MLB also took over the governance of MiLB at that time.

St. Louis in charge
All team-related decisions will remain under the control of the St. Louis Cardinals, said Andrew Buchbinder, the Springfield Cardinals’ director of branding and communications. That includes everything having to do with players, coaches and roster moves, Buchbinder said.

At the news conference, John Mozeliak, the St. Louis Cardinals’ president of baseball operations, described the MLB team as a regional branding franchise.

“When you think about the St. Louis Cardinals, on a Friday, Saturday or Sunday in St. Louis, you’d be surprised at the demographics that are actually in that ballpark that night,” he said. “They’re coming from places like Springfield; they’re coming from Memphis, Tennessee; they’re coming from Oklahoma; and therefore, we wanted to be able to reach out to that, and that’s how we ended up here in Springfield.”

Mozeliak also cited the quality of the training facility at Hammons Field and the fervor of the local supporters.

“Baseball’s a hard job. It’s a grind. Then when you have to show up every day and do it and the place is empty, it’s tough,” he said. “The thing that’s so beautiful about Springfield is the fans here in this community. They support the Springfield Cardinals.”

In discussing the timing of the sale, Mozeliak cited MLB’s change from a player development contract, a one- to four-year agreement between a franchise and its MLB counterpart, to the player development league license, a 10-year contract.

Reiter told SBJ both the 10-year contract term with the MLB team and the city’s ownership of the park made the Cardinals a stable prospect for purchase.

“Stability is absolutely critical,” he said. “Knowing that there’s long-term stability for the St. Louis Cardinals, they feel safe. They love Springfield, and they want to stay in Springfield.”

A new model
MLB ownership of an MiLB affiliate, like the St. Louis Cardinals’ ownership of the Springfield team, is unusual, according to Buchbinder, who said in the 2005 inaugural season, the local team was one of the only MiLB teams to be owned by a major league affiliate.

Reiter said the St. Louis Cardinals are experts at running an MLB organization. DBH brings expertise to minor league operations – a whole different ballgame.

“They are going to be the foremost experts in minor league baseball,” he said at the news conference.

Online publication RyanWeissBaseball.com lists a few other examples of minor league teams owned by their MLB affiliates, among them the Syracuse Mets, owned by the New York Mets; the Gwinnett Stripers, owned by the Atlanta Braves; and the Tampa Yankees, owned by the Yankees.

Teams are commonly owned by individuals, nonprofits or sometimes municipalities. One model in the Cardinals’ Texas League, the San Antonio Missions, has ownership by a local group including MLB Hall of Famer Nolan Ryan, NBA Hall of Famers David Robinson and Manu Ginobili, and other well-known citizens and entrepreneurs that formed Designated Bidders LLC to buy the team.

In a November 2022 article on MiLB.com, Reid Ryan, part of the group, said local ownership was important to securing the future of professional baseball in San Antonio.

Within the Texas League North division, of which the Springfield Cardinals are a member, the other teams are the Arkansas Travelers, a Seattle Mariners affiliate, owned by Arkansas Travelers Baseball Inc., which was formed through a public stock drive to bring the team to its area; the Northwest Arkansas Naturals, a Kansas City Royals affiliate, owned by food product manufacturer Rich Products Corp.; the Tulsa Drillers, a Los Angeles Dodgers affiliate, owned by individuals Dale and Jeff Hubbard; and the Wichita Wind Surge, a Minnesota Twins affiliate, owned by the Schwechheimer family, operating as Wichita Baseball LLC.