Local Ownership Okays Loria Groups Proposal

By Stephanie Myles/ The Gazette

The Expos ownership group gave its unanimous consent in principle yesterday to the agreement struck over the weekend between the local consortium and the group headed by New York art-dealer Jeffrey Loria. In a four-hour meeting at Montreal's Mount Royal Club, Expos chairman Jacques Menard - the head of team seeking to pump new investment into the baseball club and ensure its survival in Montreal - gave details of the agreement to his own consortium.

Among those in attendance was Loria himself. He stayed approximately an hour and returned to New York. The business plan, which Menard said will convince Major League Baseball of the team's viability in Montreal, is to be sent to baseball's New York City offices as early as today or tomorrow.

Menard said that within two or three weeks, after he and Loria have answered any and all questions satisfactorily, the game's ownership committee would quickly put the issue to a vote.

If they vote yes, as Menard hopes and expects, Loria would acquire the shares of outgoing president and general partner Claude Brochu by the end of the month - transferring control of the team, setting in motion the recapitalization of the franchise and giving the green light to the new downtown stadium.

"To say whether or not (baseball) will agree, I have no pretensions. It would be tactless and imprudent to presume anything about their deliberations," Menard said.
"I have confidence in our ability to convince Major League Baseball that we have here a business plan which will make Montreal a winning baseball city, which will assure that the Montreal Expos, in the medium term, will be a team that won't be as (dependent).
"Because we must realize that at the moment, if we are surviving, it's mostly because of the revenue-sharing system that exists in baseball."

Menard believes the model the relaunch team has developed will allow them to prove their reliance on the kindness of the haves of the game - New York Yankees owner George Steinbrenner standing tall among them in his impatience - can be wiped out over the next few years.
"I have the feeling we can overcome the majority of the objections they may come up with," he said.

What baseball wants to guarantee, Menard said, is the viability of the Expos in the long term. He spoke to two major players yesterday: baseball's chief operating officer, Paul Beeston, and Robert DuPuy, executive vice-president (administration).
"They're excited about getting our stuff and massaging it and seeing where we stand," Menard said.
MLB's public-relations department could not provide any official comment late last night.
There was unanimous agreement among the ownership group on accepting the new plan. Menard said none of the current members - including McClelland & Stewart president Avie Bennett of Toronto, who had expressed doubts about his continued involvement earlier in the process - has opted out of the new ownership group.

And there remains a possibility that Aramark Canada - whose 7.6-per-cent share of the team had to be put in trust with Brochu, with the requirement that it be sold at the earliest opportunity, when its parent company in the United States purchased a major chunk of the Boston Red Sox - could stay involved.

Menard said an agreement with Aramark to provide the concessions for the new stadium could be a way to allow them to stay, although that would be something Aramark and the new majority owner will have to work out between themselves.

The agreement, if approved, will give Loria and his U.S. moneymen (reportedly a group of three or four businesspeople) a 35-per-cent stake in the team under the new ownership structure. The current local group, plus a possible five to 10 new partners - the Canadians, as Menard referred to them yesterday - would hold the remaining majority 65-per-cent stake.

This first step would infuse no new capital into the team. But Menard said yesterday that despite losses in the current fiscal year, the Expos are solvent enough to keep operating at least until training camp opens in February. The second phase, the injection of the new capital, is to occur at the end of the year. At that point, the team's current debt will be wiped out.

The design of the proposed new downtown stadium - the cornerstone of the survival project - has been undergoing massive revision for the past six or seven weeks.

That's likely at the strong suggestion of Loria, who seems to be the catalyst for increasing the cost of the project above its mandated $200 million Canadian, or at least upgrading the design.
The seating capacity will be more than the original 35,000, probably less than 40,000.
And the engineers are still looking into whether a set of movable seat sections is cost-efficient.

Menard still believes ground can be broken on the new project in January, the latest possible date for completion in time for the 2002 season.
With the news yesterday, it appears that might be the final time the dreadfully overused word "deadline" is written in connection with the Expos saga.

If everything goes according to hopes, the process of approving the transfer of control of the Expos from Claude Brochu to Jeffrey Loria could go something like this:
- Today or tomorrow: The pro-forma agreement between the Expos owners and the group led by Loria will be sent to Major League Baseball's offices in New York.
- End of this week: Preliminary questions from Major League Baseball about the basic structure of the agreement.
- Next week: More in-depth questions about the agreement's various aspects and clauses, possible trip to New York by Expos chairman Jacques Menard to answer questions in person, along with Loria.
- Week of Oct. 18: Major League Baseball's ownership committee could meet to vote on accepting the transfer of control from Brochu to Loria. Menard will travel to answer questions in person, if necessary.
- Week of Oct. 25: The official vote by the 29 other major-league owners. The transfer of power could officially take place, and Montreal baseball fans could finally meet Loria.
- End of 1999: The second "closing" of the deal, when the official re-capitalization of the team takes place, the team's debt is wiped out and plans are finalized for the new stadium.
- January 2000: Ground is broken on Labatt Park

Previous article
Next article


Head back to Save the Expos Home Page



Make your own free website on Tripod.com