Indians Owner Richard Jacobs, who is Chair, President &
CEO of the newly formed Cleveland Indians Baseball Co. Inc.,
said that a move "toward a more diversified sports- and
media-related holding company might improve shareholder
value and elevate the company's stock," according to David
Adams of the AKRON BEACON JOURNAL. Jacobs "is looking at
expanding" into pro hockey, basketball and soccer, TV or
radio, and "even getting into consulting or event
management." Jacobs: "We owe something to our
shareholders." Since going public eight weeks ago, the
Indians' stock has dropped from $15 a share to just over $9
a share, down "about" 40%. Jacobs said he was "disappointed
in the stock performance," but that "investors and Wall
Street don't seem to realize how good of a front office he
has assembled." Jacobs, who bought the Indians in '86 for
about $46M (including debt), said he lost between $45 to
$50M in his first eight years of ownership, and that the
money raised in the IPO has gone back to him to help "recoup
his losses." Jacobs said that his baseball company "is just
starting to explore" acquisition options, but that "no
teams have been targeted yet." Adams writes that the IHL
Cleveland Lumberjacks is a franchise Jacobs "may be
considering" (AKRON BEACON JOURNAL, 7/31).
STOCK CHANGE: In Cleveland, Lubinger & Schiller report
that Jacobs is looking to change the stock structure by
proposing "to lift a clause that might keep shareholders
from receiving the same benefits his estate would from the
team's appreciation in value if it is sold after his death."
The measure will be voted on next spring, but "it's certain
to pass" since Jacobs "holds all but a fraction of the
voting rights." Market observers "agreed the proposal was a
positive move for shareholders." Lubinger & Schiller write
that team execs "touted the stock in media briefings
throughout the day," and Jacobs called the upcoming TV
negotiations in 2000 a possible "boon." The team has
created an investor relations department to market the stock
and plans to devote part of the club's Web site to investor
relations in a few months (Cleveland PLAIN DEALER, 7/31).
