A headline in Sports yesterday incorrectly said the New York Yankees and New York Mets merged their business operations. The Yankees actually formed a holding company with the New Jersey Nets of the NBA. (Published 12/02/1999)
The first merger of a baseball and basketball team won final approval today, clearing the way for the New York Yankees and New Jersey Nets to complete their marriage.
Baseball owners unanimously approved the deal, which had already been approved by the NBA.
The merger does not change the control of either team, meaning that George Steinbrenner is still The Boss of the World Series champions.
"There were some changes made overall, although George is still clearly running the New York Yankees," Commissioner Bud Selig said. "We approved the transfer of some control to the YankeeNets board."
The sale of the Montreal Expos to a group headed by New York art dealer Jeffrey Loria also won unanimous approval. The transfer of control of the Seattle Mariners to former Nintendo of America Inc. executive Howard Lincoln was approved, although John Ellis will continue to represent the Mariners on baseball's executive council.
"We covered a lot of subjects today, but these are the reasons I convened the meeting. We needed to take care of these items," said Selig, who tried to keep the 3 1/2-hour session secret.
As Steinbrenner and other others left, they either refused comment or referred questions to Selig.
It still is unclear when the Yankees and Nets will close their deal. Former U.S. Olympic Committee executive director Harvey Schiller resigned last month as president of Turner Sports and is expected to become head of YankeeNets, the holding company for the two teams.
Steinbrenner decided to merge his team's business operations with the Nets last February after breaking off sale talks with Cablevision Systems Corp. He then decided that the Yankees needed a partner before the expiration of their current TV deal, a $486 million, 12-year contract with the MSG Network that runs through next season.
Cablevision acquired the MSG Network when it gained control of Madison Square Garden, which gave Cablevision a monopoly on regional sports cable in New York City. Cablevision also owns SportsChannel, which was renamed Fox Sports New York as part of Cablevision's deal with Rupert Murdoch's News Corp.
By merging, the Yankees and the Nets create an entity with year-round programming, allowing them to either create a new regional sports channel in New York or to negotiate with The Walt Disney Co.'s ESPN and Time Warner Inc.'s Turner Broadcasting about forming a new regional sports channel. The teams also have considered issuing stock to the public.
The sale of the Expos had been in the works since last winter, tied to a proposal to construct a baseball-only ballpark in downtown Montreal.
Expos chairman Jacques Menard, part of Claude Brochu's ownership group, helped put together Loria's group, which would take control of the lowest-drawing team in the major leagues. Montreal drew just 773,227 to Olympic Stadium this year, more than 400,000 fewer fans than any other team and an average of just 9,547.
"I am very hopeful that this is going to contribute to the long-term stability and health of the Montreal Expos franchise, and I'm glad to have that behind us," Selig said. "Claude Brouchu has been a great part of baseball, and I'm sorry to see him go, but happy that this has all worked out well."
Brochu had said that if the sale was approved, he and the Expos' other partners would have to talk with their lawyers to determine when the deal would close.
Among other issues likely discussed were the labor contract with players that will probably expire after the 2001 season, the luxury tax that caused high-revenue teams to slightly slow the rate of their payroll increase, and the increasing of revenue sharing among the high- and low-revenue teams.
No decision is imminent on revenue sharing, with owners awaiting the report from their latest economic study committee, which includes former Federal Reserve chairman Paul Volcker, Yale President Richard Levin and commentator George Will.