Sunday, April 04, 1999
Battle lines over ownership are set
Reds sale depends on two documents
BY GEOFF HOBSON
The Cincinnati Enquirer
The Cincinnati Reds take the field Monday, but the fate of ownership has all the makings of a court battle.
How the club gets its next owner could rest with the legality of two documents. There is the letter-of-intent Marge Schott signed with Cleveland attorney Larry Dolan March 8 to sell her control of the team and 5.5 shares for $65 million. There's also a more recent and, sources say, a more formal agreement she signed with a group that includes her cousin, Steve Schott.
The Dolan offer is the one that three limited partners matched on Friday, potentially giving Cincinnati financier Carl Lindner, Wall Street investment banker and Northern Kentucky native William Reik and Cincinnati businessman George Strike control.
Marge Schott wouldn't talk to The Enquirer Saturday. But she is apparently livid and ready for a fight because the limited partners matched an offer that they themselves said in writing wasn't formal enough to be a real offer because it was contingent on Dolan making a deal with the limiteds. The Enquirer reported last month that the partners informed her of their belief the Dolan offer wasn't real with a letter sent a few days after the March 8 partners' meeting.
Schott apparently agreed because she ended up signing a deal with her cousin, Steve, 37, a former Reds' vice president who has not commented since the deal surfaced. His group is made up mostly of businessmen from Southwest Ohio. And on Saturday, a member of Steve Schott's group spoke out for the first time. Dennis Branoff, 46, an international businessman based in the Midwest, said his partners were caught off guard by Friday's move.
“From what I understand, we made an agreement with Marge,” Branoff said. “What surprised all of us was to hear that the limiteds said they matched on an offer that they apparently said wasn't an offer.”
A letter-of-intent was all that was needed for the last Reds' transaction. That happened last fall when Lindner, Reik, Strike and Cincinnati philanthropist Louise Nippert matched on Washington D.C. businessman Jon Ledecky's bid to buy a share of the club.
Major League Baseball indicated Friday that the partners hadn't forfeited anything because they made the match within the required 30-day window and that the Dolan deal had first dibs.
“It will be interesting to see what happens the rest of the way,” Branoff said.
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