- The Washington Times - Wednesday, August 31, 2005

Major League Baseball likely will narrow the field of bidders for the Washington Nationals by establishing a price only a few groups can meet, then choosing a winner from among them using two criteria: local ownership and minority representation.

“They will be looking closely at local connections and a minority presence,” said a source familiar with the selection process.

Those factors may prove to have more influence than connections within the game or with commissioner Bud Selig than they have had in the sale of other franchises in recent years.

Those baseball connections proved to be the deciding factor when the Boston Red Sox were sold in 2002 to a group led by then-Florida Marlins owner John Henry, former San Diego Padres and Baltimore Orioles president Larry Lucchino and former Padres owner Tom Werner. Their group was chosen even though two others submitted higher bids.

This time, though, local ties will carry more weight because of the precarious nature of District politics and the difficulties in getting a fully financed ballpark from the city at an estimated cost of $535million.

“There is a concern about the perception of having out-of-town owners come in and benefit from the financial deal made with the city,” one industry source said.

Several groups would appear to have an edge — at least based on the public knowledge about their investors — if local ownership and minority representation will weigh so heavily in the decision-making process.

“Some of these groups have investors that have not yet been made public,” an industry source said. “And there still may be some marriages between groups and investors as the process moves forward.”

The Washington Baseball Club, led by Jeff Zients and financier Fred Malek, is filled with local business connections and includes several prominent minority investors: former Fannie Mae chairman Franklin Raines, former Disney executive Dennis Hightower, former Urban League chief and political advisor Vernon Jordan, former Secretary of State Colin Powell and former Washington Redskin Darrell Green.

District Mayor Anthony A. Williams and city councilman Jack Evans have endorsed the Washington Baseball Club.

A Virginia-based group led by Albert Lord and William Collins also has a list of local business and political contacts among its group. Minority investors include Warren Thompson, owner of Thompson hospitality, the largest minority-owned food service company in the United States; and former Redskins Art Monk and Charles Mann.

Jonathan Ledecky is a well-known Washington businessman and has the backing of several city council members. But if he has any minority investors among his backers, they have not been revealed.

That applies to another local group led by developer Mark Lerner and his father, Ted, who have declined to discuss their bid or reveal any minority investors.

Businessman Franklin Haney is from Tennessee but does a lot of real estate work in the city and thus has some business connections. It is not known whether any minority investors have joined his group.

Among the out-of-town bidders, the group led by Los Angeles businessman Ronald Burkle includes Jesse Jackson’s son, attorney Yusef Jackson, but has no one with strong local ties.

The two remaining out-of-town bidders do not appear to have any local connections or minority representation, based on reports to date. However, they have strong connections within baseball, which have played such a key role in past franchise sales. Telecommunications executive Jeffrey Smulyan is the former owner of the Seattle Mariners. Stan Kasten is an Atlanta-based attorney who has worked as president of the Atlanta Braves, in addition to running the Atlanta Hawks in the NBA and the Atlanta Thrashers in the NHL.

Major League Baseball’s chief operating officer, Bob DuPuy, said last week an announcement about the selection of an owner for the Nationals would be made by Labor Day.

However, several bidders privately said they doubt Monday’s target date will be met. What is more likely, according to sources familiar with the process, is that baseball will narrow the field of bidders by setting a fixed sale price — bidders believe that price could reach $450 million — then address the issues of local presence and minority ownership before finally selecting a winner.

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