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More Silicon Valley investor talk

OAFC BBS - All Topics: Archive: More Silicon Valley investor talk
Top of pagePrevious messageNext messageBottom of pageLink to this message   By chris_d on Friday, February 28, 2003 - 10:13 am:

http://www.oaklandtribune.com/Stories/0,1413,82~1865~1211016,00.html


Pitch to buy team made to Hofmann
Co-owner is listening to 'legitimate' offers from Silicon Valley investors, spokesman admits

By Paul T. Rosynsky, STAFF WRITER

OAKLAND -- Oakland Athletics co-owner Ken Hofmann is entertaining an offer to sell his half of the baseball team to an investment group with a Silicon Valley connection, a spokesman admitted Thursday.

Calling it "probably the most legitimate" offer in recent memory, Sam Spear, a spokesman for the A's other owner, Steve Schott, said negotiations are ongoing between Hofmann and "a point person with Silicon Valley connections."

The admission came just two months after The Oakland Tribune first reported Hofmann was having discussions with a Silicon Valley investor interested in a new Oakland downtown ballpark for the team.

The organization denied those reports then and continued to say Thursday that the point person and the investor "are not the same."

But a source with knowledge of the negotiations said the point person's Silicon Valley connection is the investor.

Since it was first revealed that the Silicon Valley investor was pursuing the purchase, he has put together a group of like-minded financiers and the point man to pitch the idea to Hofmann and Schott, the source said.

The need for a point person appears to be a request by Schott, who as managing partner, must approve any sale of Hofmann's share.

Spear said Schott would not deal with a "cast of characters."

"It is not going to be a cast of characters for Mr. Schott to deal with," he said. "It will be with the point man. They can invest with (the point man), but Mr. Schott is not taking the group of investors."

That group's members, however, will be essential for the deal to go through. In addition to Schott, the sale must be approved by Major League Baseball, which in 1999 rejected a bid by Northern California businessmen to buy the entire team.

A source said the current investment group has "familiar faces," and a formal written offer may be made as early as next month.

Spear refused to reveal the point person or members of an investment team. He also said any deal would not occur in the near future.

"We're working on it, but that doesn't mean it is close at all," Spear said. "It's not an easy thing."

In any case, the confirmation marks the third time the team has first denied and then admitted it had potential buyers lined up. It also finally verified constant rumors that Hofmann wants to sell his portion.

In August 2001, Mandalay Entertainment of Hollywood almost bought the team for $150 million. Then in July 2002, a deal to sell the team to Washington, D.C., investor Jonathan Ledecky for $170 million collapsed when Ledecky reportedly missed a deadline for making a $12 million deposit.

The difference this time, however, is Schott's insistence that he will not sell his share.

"As of right now, Mr. Schott is very happy owning the team," Spear said.

Top of pagePrevious messageNext messageBottom of pageLink to this message   By diamond_lil on Friday, February 28, 2003 - 10:20 am:

here's yesterday's Merchy News Purdy column. Please note Mr. Purdy has been a big booster of the team relocating down South.

http://www.bayarea.com/mld/mercurynews/sports/5274559.htm

Posted on Thu, Feb. 27, 2003

Tejada talks handcuffed by A's uncertain future
By Mark Purdy
Mercury News Staff Columnist


AP Photo/Eric Risberg

Miguel Tejada strikes a pose during picture day at spring training.


Steve Schott, the A's owner, has been recuperating from some nasty dental surgery that involved drilling into his gums hard enough to make his head rattle and . . . . well, you don't want to know the gory details.

``It feels fine now,'' Schott said Wednesday over lunch, pronouncing himself probable for opening day.

Let's just say, however, that pain is relative to Schott at the moment. That's why he can't get too vexed about the Miguel Tejada contract situation. Tejada, the American League MVP, is in the final season of his A's contract. If he isn't signed to a new deal, he could leave the team as a free agent next winter. Some people believe that's exactly what will happen. And since negotiations have barely begun, Schott has no way of knowing for sure.

``I really like all our guys,'' Schott said. ``I think they're good guys. I'd love to keep all of them for as long as possible.''

Translation: He won't be able to keep all of them as long as possible. And he knows it.

Schott has never hidden his firm policy about trying to operate the A's as a winning franchise with a balanced budget. He doesn't mind losing a little money some years if he makes a little money other years. This season's payroll will increase to $49 million from the $42 million of last season, when the A's suffered a slight financial loss despite their third consecutive playoff appearance. What this means is, the team must pick and choose its contract battles. After the 2004 season, third baseman Eric Chavez's contract expires. Tim Hudson and Jermaine Dye come up for renewal in 2005.

So, ask yourself. Should the A's sign Tejada to a long-term deal and use money they might otherwise pay Chavez and Hudson or Dye? Or vice versa?

Schott won't say. But it's a safe bet that if Tejada demands a seven-year or eight-year contract, he is likely to be a Non-Athletic in 2004. Fans look at each player's contract situation individually and wonder why a team doesn't open the bank. Schott and his general manager, Billy Beane, must look at the entire landscape in not merely three dimensions, but four.

The fourth dimension would be time. While the Giants are relatively sure of filling up Pacific Bell Park's seats indefinitely, the A's season ticket base -- and overall attendance -- can ebb and flow. So how does a team commit to a contract that goes through 2009 or 2010 when it is impossible to estimate what the revenue will be, or even where the A's will be playing? If Tejada is signed to a $75 million contract through 2010, are the A's worth more as a franchise to a potential buyer? Or less?

``I'm not sure,'' Schott said. ``But I'm not looking to sell the team, anyway.''

He is, however, looking to sell half the team. For the first time, Schott confirmed that co-owner Ken Hofmann's attorneys have asked Schott to find a buyer for Hofmann's 50 percent of the franchise -- and that Schott is talking with a potential group of investors.

``It isn't easy to find someone who wants to buy 50 percent of the team and not have any controlling power,'' Schott said. ``And I'm not interested in buying the other 50 percent.''

Schott and Hofmann, who both made their money building homes, have been 50-50 partners in the A's since they purchased the team in 1995. But under terms of the agreement, Schott is the managing general partner. He has final say on baseball matters.

Schott would not reveal who is interested in buying Hofmann's 50 percent stake. But some of the investors are local, and Schott said they are headed up by a ``point man'' with Silicon Valley connections.

``I'm also talking to a couple of other people,'' Schott said. ``I'm trying to do the best I can to be a good partner and find a deal that would make sense for Ken, while at the same time finding a situation with a new partner or group of partners with whom I could have the same working relationship that exists now with Ken.''

Schott said the talks are not close to reaching fruition and probably will continue through the season, as terms are discussed. For example, Hofmann may want more for his share than the new group wants to pay. And the new group may insist on an option to buy Schott's 50 percent of the team in the future under certain conditions.

This, of course, would raise issues about whether the team might move -- to Silicon Valley or anyplace else. While the A's have signed a lease to stay in Oakland for the next several years, the team can easily buy its way out of the lease. Last week, Commissioner Bud Selig announced that in trying to find a new home for the Montreal Expos, he would hear presentations from groups in Portland, Ore.; Washington, D.C.; and Northern Virginia. This did not escape Schott's notice.

``I'm interested in that for a lot of reasons,'' Schott said. ``One of them being, I'm a part-owner of the Montreal Expos.''

He's not joking. Currently, the Expos are the property of Major League Baseball, which also operates the team. But if the Expos are permitted to move into the Washington, D.C. area, they would move directly into the market area of the nearby Baltimore Orioles. This would give Schott an excellent argument to fight the territorial-rights claim of the Giants, who claim San Jose and the South Bay as part of their territory.

``What happens in those other places could be encouraging to some degree,'' Schott said. ``But it may or may not open the door for the team to move somewhere else in the Bay Area.''

As Schott notes, that's not even worth discussing at this point, because the current economy makes it ``virtually impossible'' to construct any financing plan in any Northern California city.

The franchise's state of prospective flux, though, does make it hard to assemble a long-term offer for any player. Which is where we come full circle. Tejada deserves a rich new contract. But when his agent negotiates, he should keep the fourth dimension in mind. That could be the deal-breaker.


--------------------------------------------------------------------------------
Contact Mark Purdy at mpurdy@sjmercury.com or (408) 920-5092. Fax (408) 920-5244.

Top of pagePrevious messageNext messageBottom of pageLink to this message   By diamond_lil on Friday, February 28, 2003 - 10:38 am:

from the ess eff comical:

http://www.sfgate.com/cgi-bin/article.cgi?f=/chronicle/archive/2003/02/28/SP190261.DTL

Briefly: Team president Mike Crowley said that co-owner Ken Hofmann is looking for a buyer for his half of the team. "He would entertain offers," Crowley said, adding that any talks with potential investors are "very preliminary." . .

Top of pagePrevious messageNext messageBottom of pageLink to this message   By diamond_lil on Saturday, March 01, 2003 - 10:26 am:

Schott and his PR guy Sam Spear should at least take good notes if they want to continue to speak from both sides of their mouth.

Can't they realize they keep contradicting themselves and have no more credibility whats0ever?

http://www.bayarea.com/mld/cctimes/5292833.htm

Posted on Sat, Mar. 01, 2003

Schott not buying report of A's sale
By Ann Tatko

An A's official and the spokesman for co-owner Steve Schott denied reports that Ken Hofmann is considering an offer from a Silicon Valley investor to buy Hofmann's half of the team.

An Oakland Tribune story Friday quoted Sam Spear, Schott's spokesman, as saying Hofmann had received a "legitimate" offer from an investment group with a connection to Silicon Valley.

Spear told the Times on Friday that his comments were misconstrued.

"There is no Silicon Valley person that we're talking to at the moment," Spear said.

Spear and A's president Mike Crowley acknowledged that Hofmann is interested in selling his share of the team, which he and Schott bought in November 1995 for $95 million.

But Crowley said no official offer has been made.

"At this time, (Hofmann) is looking for investors to buy his share," Crowley said, "but no official negotiations have begun."

The Tribune reported that a Silicon Valley investor has put together a group of investors with a "point man" who will present an offer to Schott and Hofmann.

As co-owner, Schott must approve any offer for the sale of Hofmann's share.

But one source close to the owners said no offer can be viewed as legitimate until significant obstacles are overcome.

The biggest obstacle is finding a potential buyer willing to accept the current ownership structure, in which Schott serves as the sole managing partner.

The future of the team also remains in question. The team, city of Oakland and Alameda County have not made concrete progress toward building a downtown ballpark. And the major leagues' television contract is set to expire in 2005, and the A's do not know how much money they will receive from a new deal.

Also, based on current player contracts, the A's may face a payroll of more than $50 million within two years.

Factoring those issues into a potential sale likely will make any negotiations a lengthy process, the source said.

"It will be a difficult challenge to find anyone during this season," the source said. "I don't want to say that it's remote, but if I was a betting man, I would not bet on it."

The A's have been the subject of several stories involving ownership sales since Schott and Hofmann purchased the franchise. Each time, A's officials initially denied the reports.

In 1999, a group of businessmen offered to buy the team in order to keep the A's in Northern California. Major League Baseball rejected that offer.

In 2001, A's officials told city officials they were considering an offer from Mandalay Entertainment, a Los Angeles-based company with film and minor-league baseball interests. Mandalay withdrew that offer two days later.

Later that year, they also were exploring the possibility of a sale and move to Santa Clara, which Major League Baseball basically nixed when it upheld that the Giants own rights to the South Bay market.

And last year, a possible deal with a Washington, D.C., investor reportedly fell through.

In all of those instances, both Schott and Hofmann were looking to sell the team. This time, only Hofmann is trying to sell his share, Crowley said.


--------------------------------------------------------------------------------
Times staff writer Rick Hurd contributed to this story.

Top of pagePrevious messageNext messageBottom of pageLink to this message   By eyleenn on Saturday, March 01, 2003 - 12:06 pm:

What a joke.

Top of pagePrevious messageNext messageBottom of pageLink to this message   By diamond_lil on Saturday, March 01, 2003 - 12:30 pm:

It is really a joke but I hope the writers and columnists who interview these bozoz don't think the joke is very funny.

Here are just recent direct contradictions with quotes by Schott and Sam Spear on recent articles and columns just from this past week:

Calling it "probably the most legitimate" offer in recent memory, Sam Spear, a spokesman for the A's other owner, Steve Schott, said negotiations are ongoing between Hofmann and "a point person with Silicon Valley connections."

http://www.oaklandtribune.com/Stories/0,1413,82~1865~1211016,00.html

and then


"There is no Silicon Valley person that we're talking to at the moment," Spear said.

http://www.bayarea.com/mld/cctimes/5292833.htm

while Schott told columnist Marc Purdy of the Merc News

Schott would not reveal who is interested in buying Hofmann's 50 percent stake. But some of the investors are local, and Schott said they are headed up by a ``point man'' with Silicon Valley connections.

http://www.bayarea.com/mld/mercurynews/sports/5274559.htm

Top of pagePrevious messageNext messageBottom of pageLink to this message   By kevink on Saturday, March 01, 2003 - 08:08 pm:

The Silicon Valley connections might not mean much in terms of the A's moving to the South Bay. Unemployment is now 8.6% in the valley and no turnaround expected in the near future. Right now there is no money for a stadium here and I seriously doubt companies like Cisco or anyone else are going to plop down $50 million for naming rights.
The scary thing is that then the A's are owned by 2 parties with connections to the South Bay. But I still think the A's will be at the Coliseum for a long time.

Top of pagePrevious messageNext messageBottom of pageLink to this message   By kbailey3131 on Saturday, March 01, 2003 - 08:36 pm:

Craziness...I hope they're selling the whole club because it did strike me odd the other day when Schott was (purportedly) talking about somebody wanting to buy that large a % of the team and still let him call all of the Schotts, er..shots. What are the odds he finds another Ken Hoffmann, moneybags - low visibility. Especially some group with a "point man" The Giants have about a bazillion minority owners so I suppose its still possible. If the A's are going to parse out chunks of the team like that, I'll throw in a few bucks and claim a .45% stake in the team.

Top of pagePrevious messageNext messageBottom of pageLink to this message   By diamond_lil on Saturday, March 01, 2003 - 08:52 pm:

kevin, the sources I've spoken to all said that this a venture capitalist with ties to silicon valley...which means ne has money invested there there in silicon valley and are also interested in being an owner of the the A's.

One source even mentioned that he is interested and likes the idea of having the ballpark built at the Uptown site in Oakland. But of course Schott may very well not go for that idea at all.

Top of pagePrevious messageNext messageBottom of pageLink to this message   By diamond_lil on Sunday, March 02, 2003 - 11:21 am:

Newhouse puts in his two cents on Schott's intentions.

http://www.oaklandtribune.com/Stories/0,1413,82%257E1748%257E,00.html

from Dave's column linked above:

"Schott would move the Oakland A's to Santa Clara in a heartbeat if he could, though the South Bay has stated it doesn't want him or even trust him.

It's easy to see why. Schott has denied that every potential investor in the A's even existed. In truth, they have, which was proven again the other day when Schott finally confirmed that a Silicon Valley investor wants to buy into the A's, two months after ANG Newspapers' Robert Gammon broke the story.

The unnamed investor, who heads a group of financiers, wants Ken Hofmann's half of the A's ownership. Don't hold your breath, A's fans. For if Schott senses the Silicon Valley group is after his half, too, the deal's off.

Schott hopes the Montreal Expos will relocate to Washington, D.C., a 40-minute drive from where the Baltimore Orioles play. Such a move might legally break the San Francisco Giants' territorial rights claim to the South Bay, and allow Schott to try once more to shift the A's to Santa Clara."


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