SBD/28/Franchises

CELTICS' STOCKHOLDERS NOT GETTING RICH OFF THE GREEN?

     Partners Don Gaston, Alan Cohen and Paul Dupee together have
made $1.8M a year in management fees from the Boston Celtics
Limited Partnership, but for other investors the team has been
"far less rewarding," according to the current issue of FINANCIAL
WORLD.  FW's Ronald Fink reviews the stock, "the purest play on
professional sports in the U.S.," and finds that price
appreciation since the IPO has been roughly 2% a year.  With
dividend reinvestment, annual returns improve to 12-13% a year --
 "but the dividends are likely to be slashed."  The reasons for
the disappointing track record:  The IPO price of $17.50 was too
high; the Celtics' deal for a local TV station was a good one for
partners, but bad for investors; and, the fact that master
limited partnerships (MLPs) are off-limits to pension fund
investors.  Fink notes that the team has about $170M in cash
after the sale of the TV station, with one possible use being a
purchase of the Red Sox.  But with the Celtics set to lose their
MLP tax break on earnings in '97, the general partners may look
to buy up investors' shares "at a discount."  That could change
if a bill backed by Sen. Finance Committee Chairman Bob Packwood
extending the MLPs' current tax status is passed (FINANCIAL
WORLD, 5/9 issue).
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