Time Warner reaches deal to sell Braves
February 13, 2007
NEW YORK (AP) - Time Warner (NYSE:TWX) Inc. finalized an agreement Monday to sell the Atlanta Braves to Liberty Media Corp. after more than a year of negotiations.
The deal, which values the team at $450 million, was submitted to Major League Baseball for its approval process, two people familiar with the deal said, speaking on condition of anonymity because no announcement had been made and publicly traded companies were involved.
The parties hope baseball will approve the sale in time for the team to be transferred by opening day, the person said. Under the agreement, Terry McGuirk will remain in charge of the team after the sale. General manager John Schuerholz and manager Bobby Cox also are expected to remain on, the person said.
The Wall Street Journal, which first reported the finalization on its Web site, said Time Warner will transfer the Braves, a group of craft magazines and $1 billion in cash to Liberty in exchange for about 60 million shares of Time Warner. Based on the closing price of Time Warner's stock Monday, the market value of those shares would be about $1.27 billion.
Liberty Media spokesman John Orr and Time Warner spokesman Ed Adler declined to comment.
'We received certain of the sale documents today but have not yet reviewed them,' said Bob DuPuy, baseball's chief operating officer.
He said baseball staff will go over the documents to make sure they meet baseball's usual sale rules.
'It will then go to the ownership committee, then will go to the executive council, then will go to the clubs,' he said.
The parties had waited to receive tax opinions before reaching an agreement, the person involved in the deal said. The agreement was designed to minimize taxes.
Liberty currently has about 170 million shares of Time Warner, which is equivalent to a stake of about 4 percent of the media company, whose holdings include Time Warner Cable (NYSE:TWC) , HBO, AOL, CNN, Warner Bros. and Time Inc. The deal would reduce the size of Liberty's stake in Time Warner to about 2.6 percent.
Time Warner acquired the Braves when it bought Atlanta-based Turner Broadcasting Systems from Ted Turner in the mid-1990s.
Website might hinder Braves deal
By Andy Vuong
Denver Post Staff Writer
02/15/2007
Liberty Media's deal to acquire Major League Baseball's Atlanta Braves could hit a hitch because the Douglas County-based company owns the Internet's premier sports-betting information website.
Liberty's ownership of DonBest .com - which provides gamblers with betting lines, "expert" picks and other information to help them win money on sporting events - presents a conflict of interest, said sports-business expert Dave Smrek.
"I think Major League Baseball would have to take a long, hard look at it," said Smrek, principal of Denver-based Adrenalin, a sports-consulting firm. "In one way or another, it needs to be addressed."
Liberty's agreement to acquire the Braves from Time Warner as part of an asset swap requires approval from 75 percent of major-league team owners.
Major League Baseball has long abhorred its teams' having ties with gambling operations. MLB spokesman Rich ard Levin said Wednesday he couldn't comment about what impact Liberty's interest in DonBest might have on the approval process.
In response to an e-mail questioning DonBest's operations and its potential impact on the Braves deal, Liberty spokesman John Orr wrote, "We have no comment." DonBest is operated by Toronto-based Fun Technologies. Liberty paid $195 million last year for a 51 percent stake in Fun.
Described in a 2003 New York Times article as the "Bloomberg of sports betting," DonBest charges users $600 a month for up-to-the- minute betting odds on games in every major sport, including baseball.
"It's definitely the No. 1 sports-betting-line service online," said gambling expert Ken Weitzner, president of EyeOnGambling.com. "There's not even a close second; it's that popular."
Betting on major sports such as baseball in the United States is legal only at casino sports books in Las Vegas.
DonBest features betting lines from offshore sports books such as TheGreek.com and Sportsbook.com. The U.S. Department of Justice last year launched a major crackdown on online gambling, arresting executives of sites such as Bet OnSports.com while they traveled in the U.S.
It's unclear whether DonBest, which hasn't been targeted by the U.S. government, receives revenue from illegal sports-betting websites.
"Obviously, any direct ties with illegal gambling presents a problem for baseball," said Levin, the MLB spokesman.
DonBest also offers picks from its sports experts that are guaranteed to make money for users or they don't have to pay the fees, which range from $25 to $40 per package of daily picks.
Liberty shouldn't have a problem divesting DonBest if it is asked to do so to get the Braves deal approved, Smrek said. "For them, this is a pretty small play," he said.