Tuesday, April 20, 1999
Schott, partners close to deal on sale
BY SCOTT MacGREGOR and GEOFF HOBSON
The Cincinnati Enquirer
![[lindner]](http://reds.enquirer.com/img/mugs/lindner.jpg)
Carl Lindner
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![[schott]](http://reds.enquirer.com/img/mugs/schott.jpg)
Marge Schott
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A lawsuit that has the Reds' pending sale tied up in a court battle appears headed toward a settlement that would give three of Marge Schott's limited partners control of the team — but not strictly on the terms of the $65 million offer that they matched from Cleveland lawyer Larry Dolan.
Sources told the Enquirer Monday the sides are negotiating a settlement that would transfer control of the club to limited partners Carl Lindner, George Strike and Bill Reik but would also allow concessions to all parties involved, including Mrs. Schott and her cousin Steve Schott, whose competing $67 million offer led the three partners to file a lawsuit against Mrs. Schott last week.
Frank Kelley, the former Michigan attorney general who represents Mrs. Schott, was in Cincinnati Monday but would not comment on the negotiations. But sources involved said progress had been made, although there was no final agreement as of late Monday night. The final settlement likely will be for more money but more closely resemble the Dolan offer in terms of minor issues, the sources said.
Messrs. Lindner, Strike and Reik filed their lawsuit against Mrs. Schott last week over the dueling bids she accepted and won a temporary restraining order that prevented her from shopping the club to any further bidders until at least April 29.
The limiteds contended the deal Mrs. Schott struck with Steve Schott to sell 5.5 of her 6.5 shares for $67 million was “contrived” after they had agreed to match the Dolan deal for the same number of shares. They also contended matching the deal offered by Steve Schott would cost them $5 million more up front and $7 million more down the road.
Mrs. Schott and the limiteds are scheduled to present their cases at a hearing for the injunction in nine days, but a settlement would make the court action moot.
According to the lawsuit, the Steve Schott deal would cost Mr. Lindner, Mr. Strike and Mr. Reik $2 million more in purchase price, a $2.68 million commission to Steve Schott, $250,000 to charity and $7 million if Mrs. Schott decided to sell her remaining share down
the line for $15 million instead of the $8 million outlined in the Dolan offer.
The Dolan agreement requires the Lindner, Reik and Strike group to keep the Reds in Cincinnati. The Steve Schott offer gives the owners the option of moving the team after making a best effort to remain in Cincinnati.
A source said the current negotiations weren't black-and-white — that the final deal would not come down to the strict details of either plan, but that in either case the limiteds would gain control of the club. Mr. Schott and Mrs. Schott could also end up with some gains from Mr. Schott's offer.
The negotiations were characterized as amicable, and Mr. Schott and Mr. Lindner were spotted chatting at a birthday party for Cincinnati restaurateur Jeff Ruby Monday night for about 15 minutes before shaking hands as they parted.
Mr. Schott's bid also contains more perks for Mrs. Schott, including buying naming rights to the museum at the new Reds stadium and calling it “The Schott Hall of Fame/Museum” for a fee of $250,000. Both deals allow her to keep one limited partnership share.
Mrs. Schott would retain her luxury box and office at Cinergy Field and at the new park under both proposals, but would keep only 16 blue-level seats instead of 21 in the Schott plan. The Dolan agreement also does not include the right for her to participate in the Findlay Market Parade on Opening Day, as the Steve Schott offer does.
A source with Major League Baseball said no matter what the legal agreement, the league will have final say on Mrs. Schott's perks as stipulated by terms of her suspension for making insensitive remarks in 1997. The source said Baseball would be particularly wary of allowing Mrs. Schott to keep an office.
John Erardi contributed to this report.
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