- The Washington Times - Wednesday, July 30, 2003

The Washington Redskins, led by majority owner Dan Snyder, are in the process of selling a minority stake in the franchise, NFL and team sources said yesterday.

Three shares, valued at just more than $200 million combined, are being sold, sources familiar with the deal said. The three purchasers are said to be close to Snyder but their identities remained unclear last night.

Snyder’s family will retain a majority interest in the team, between 60 and 70 percent. The purchasers will not gain any say in the team’s operations.

The transaction technically is referred to as “resyndicating” the shares. In this case the shares are the approximately 20 percent formerly belonging to Mort Zuckerman, one of the original minority owners when Snyder purchased the club for $800 million in May 1999.

Zuckerman, a prominent real estate developer and publisher, sold his shares in 2000 and Snyder only recently decided to re-sell them.

The proceeds from the sale, sources said, will go toward paying down the club’s net debt. Once the NFL’s most heavily leveraged team, with more than $500 million in debt, the club now will have approximately $250 million in debt with Bank of America.

The Redskins no longer will rank among the NFL’s most heavily leveraged franchises, sources familiar with the league’s debt financing said.

The sale currently is pending in the league’s finance committee, and those familiar with it say there is an expectation it will go through. The transaction was presented in May at the NFL spring meetings in Philadelphia.

The Redskins’ ownership group now will be split into two major factions: Snyder’s family as the majority owners, and four minority owners.

Owning shares under the umbrella of Snyder’s family are his sister, M.D. Snyder, and his mother, Arlette. Snyder’s father, Gerald, also was a minority owner before he died on May 23.

The four minority owners include the three newcomers and Fred Drasner, a publishing and marketing executive who has between a 10 and 20 percent stake. Drasner has remained particularly visible in team operations during Snyder’s tenure.

Having multiple minority owners isn’t unusual in professional sports circles.

The Houston Texans, for example, have 11 minority owners under majority owner Robert McNair, while the Carolina Panthers have approximately 10 under majority owner Jerry Richardson.

Elsewhere in Washington, both the NBA’s Wizards and NHL’s Capitals have more than a half-dozen minority investors apiece.

Snyder’s move to pay down the Redskins’ debt fits with what the finance committee has been stressing in recent years. The committee has undergone a systematic review of teams’ debt structuring in the wake of surging franchise values, essentially trying to update the guidelines for how much debt is permissible.

The finance committee is made up of eight NFL owners. The powerful group reviews the fiscal soundness of every incoming majority or minority owner. Prospective owners are subject to extensive financial disclosures and background checks.

Some sources made clear that Snyder is getting no personal gain for this transaction, nor is he using the money for more players. According to Forbes magazine, Snyder’s personal worth is $660 million.

Staff writers Eric Fisher and Rick Snider contributed to this report.

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