Swing deal not a done deal yet

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By Steve Batterson | Tuesday, November 21, 2006 1:04 AM CST | () comments

Although a new lease for city-owned John O’Donnell Stadium has been approved, the current and prospective owners of the Swing of the Quad-Cities continue to work to complete an agreement that would lead to the sale of the Midwest League franchise.

Swing team president Kevin Krause said Monday that the ownership group he heads, Seventh Inning Stretch, remains in negotiations with representatives of Florida-based Main Street Baseball.

“There are a few details remaining which we continue to work through,’’ Krause said.

He characterized those details as typical of any business

transaction but said he did not know when the agreement would be completed.

Main Street Baseball, headed by David Heller, has signed a letter of intent to purchase the franchise from Seventh Inning Stretch but cannot begin baseball’s multi-tiered franchise transaction process until the deal is complete.

Once that happens, the process begins when a Control Interest Transfer document is filed with the Midwest League.

As of Monday, that had not happened, and league president George Spelius said it is unlikely the proposed sale will be discussed by league directors during an upcoming meeting on Dec. 5 that is being held during baseball’s winter meetings in Orlando.

“That’s two weeks away. I can’t see it happening that fast, even if the CIT arrived in the mail tomorrow,’’ Spelius said. “Although we try to expedite the process as quickly as we can, we’re not just going to push it through.’’

When the CIT arrives, a committee consisting of three league directors, Spelius and league attorney Richard Nussbaum will review the document, which includes financial and background information on all individuals involved in the purchase of a team.

“The review is thorough, and I’ve never been part of a review where questions have not been asked,’’ Spelius said. “All of the questions are required to be answered to the committee’s satisfaction before we take the proposal to the league directors.”

If approved by league directors, the CIT is then reviewed by the National Association of Professional Baseball Leagues and eventually by Major League Baseball.

Questions can be raised during any step of the transaction process, which typically takes from three to six months.

The club’s current ownership will continue to operate the Swing until the transaction is complete.

“We’re selling tickets and making plans for 2007, and our home opener at 11 a.m. on April 9,’’ Krause said. “It’s business as usual here.”

Krause said the Davenport City Council’s approval of a new 25-year lease with the prospective owners has allowed talks between Seventh Inning Stretch and Main Street Baseball to continue.

“The city’s approval of a new lease was a big thing hanging over everybody’s head, and they’ve got a lease that is certainly workable,’’ Krause said.

The approved lease would reduce the club’s annual payments to the city, but its longer length would cover the club’s portion of costs for the 2004 renovation of John O’Donnell Stadium.

Under terms of the old lease, the Swing paid just less than $490,000 per year on a 15-year agreement. The new lease calls for the club to pay $273,000 for the first two years and $385,000 annually in years three through 25.

Steve Batterson can be contacted at (563) 383-2290 or sbatterson@qctimes.com.

The process

Minor-league baseball’s franchise sales process is a four-tiered process. In the case of the proposed sale of the Swing, here’s how it works once a Control Interest Transfer document is filed with the Midwest League:

A committee consisting of three Midwest League directors, the league president and league attorney review the document. It can approve the document or seek additional answers to questions.

League directors vote on the proposal. They can approve or deny it or seek additional information from the purchaser.

The National Association of Professional Baseball Leagues — the governing body of minor-league baseball — studies the CIT. It can approve or deny it or seek additional information.

Approval by the major-league commissioner’s office is the final hurdle in any transaction.