A graphic that appeared yesterday gave the incorrect number of cases of National Premium beer that could be bought for $173 million -- the Orioles' auction price. The correct number is 26,615,384, based on a retail price of $6.50 per case.
The Sun regrets the error.
NEW YORK -- A Baltimore-led group of investors triumphantly bought the Orioles yesterday for a staggering $173 million, after a tense bidding war drove up the price to record levels for a sports franchise.
The jampacked hearing in a stifling Manhattan courtroom went through 16 rounds of bidding before two previous opponents -- Baltimore attorney Peter G. Angelos and Cincinnati investor William O. DeWitt Jr. -- defeated New York art dealer Jeffrey H. Loria.
Led by Mr. Angelos, the winners paid nearly $70 million more than the previous record price for a baseball team, an amount that Mr. Angelos called a worthwhile "premium" because it returned the team to local ownership after more than a decade of outside control.
"This brings back control of the club to Marylanders, but to be candid, I didn't think the price would go so high," Mr. Angelos said.
Despite the record amount, Mr. Angelos and Mr. DeWitt said they had enough money to field a decent team and that the price did not mean the Orioles would have to take on extra debt or that ticket prices would rise dramatically.
After the Angelos group's $173 million bid, Judge Cornelius Blackshear turned to Mr. Loria for his bid, but the art dealer instructed his lawyer to concede. He then stood up and wished the new owners good luck.
The sweaty audience broke out into applause, while some attorneys murmured their disbelief at the price and others called out congratulations to Mr. Angelos.
After Mr. Loria bowed out, Judge Blackshear of the U.S. Bankruptcy Court for the Southern District of New York heard briefly from creditors, who had wanted the Orioles sold so they could recoup some of the money they have lost to Orioles owner Eli S. Jacobs. The creditors quickly gave their approval to the sale, and Judge Blackshear ended the hearing.
Yesterday's sale still has to be approved by Major League Baseball, but that is considered all but done. Mr. Angelos said he has been told to expect their approval very soon. The deal is supposed to be closed by Sept. 15.
Until then, the team will be run by its current front office, which the new owners have said will stay on. Any major decisions, however, would have to be approved by the new owners.
Maryland Gov. William Donald Schaefer said the sale was "terrific" news for the city and state.
"He'll [Mr. Angelos] put a ballclub on the field, spend money and make us proud," Mr. Schaefer said.
Before yesterday's 2 p.m. hearing, four groups were vying for the team, with Mr. Angelos and Mr. DeWitt considered the front-runners after they faced off at a June hearing and bid up the price of the team to $148.1 million.
But yesterday's hearing was delayed as Mr. Angelos and Mr. DeWitt patched together an alliance, which left Mr. Angelos as managing partner and Mr. DeWitt in charge of baseball operations, a loose title that places him above the team's general manager. The two said they immediately would increase their offer to $151.25 million.
Backed by nearly 15 investors, including well-known Baltimoreans such as filmmaker Barry Levinson, retailer Leonard Boogie" Weinglass, tennis star Pam Shriver and author Tom Clancy, the new group faced Mr. Loria and Jean S. Fugett Jr., a former Baltimore lawyer and professional football player who is now chairman of TLC Beatrice International Holdings Inc.
Both Mr. Angelos and Mr. DeWitt had courted Mr. Fugett, who runs the country's largest black-owned business and would have been the first minority member to own a major-league baseball franchise. Mr. Fugett, however, rebuffed all offers that would not leave him or his family in charge, saying he wanted to bid so that a black person would own a team.
The hearing was punctuated by breaks during which hordes of lawyers thronged the courtroom's hallways, trying to arrange alliances and gauge their opponents' positions.
The Angelos-DeWitt group started with their $152.25 million bid, followed by a pass from Mr. Fugett's attorney, who took a pass during each of first 14 rounds. This put the spotlight on the battle between the Angelos-DeWitt group and Mr. Loria.
At first, the Angelos-DeWitt group increased its bid by $1 million, and Mr. Loria's attorney responded by going up $100,000, the smallest increment possible.
This tense seesaw continued through eight rounds, until Mr. Loria's attorney began bidding up by $1 million as well, with the two groups pumping the price over the $160 million and $170 million barriers -- levels that none of the participants apparently thought likely when the day began.
After the 13th round, with the high bid made by the Angelos-DeWitt group for $170 million, Mr. Loria took a pass, and the Angelos-DeWitt group declared itself the winner.
But Judge Blackshear said that in the interest of getting the highest prices for the creditors, who are owed more than $320 million by Mr. Jacobs, he would grant a recess requested by Mr. Fugett's attorney.
During the recess, Mr. Fugett essentially dropped out, later refusing to comment on why he never placed a bid.
After the recess, Mr. Loria countered with $171 million, and the bidding continued until -- $21 million and 45 minutes after the opening bid -- the Angelos-DeWitt group offered its winning bid.
The price was $173 million, although on paper the offer was $174 million vs. $173 million for Mr. Loria. The reason is that the Angelos- DeWitt group was given $1 million credit for legal work done in drafting the sale contract.
The result was the highest price for a sports team in North America, bettering the $140 million paid for the Dallas Cowboys in 1989 (that price included the Cowboys' home, Texas Stadium). The previous record for a baseball team was $106 million for the Seattle Mariners last year.
Reaction ranged from joy to skepticism.
"When they told me that Peter Angelos had purchased the team, I was just ecstatic. There's no other word," said Mr. Schaefer, a driving force behind building the Orioles' new park at Camden Yards.
However, a fan at Camden Yards last night, Craig Ratcliffe of Hanover, Md., said: "Whoo, I just hope they can afford to keep the team. Are they going to be able to go after the players? Are they going to have to raise ticket prices? How much is a hot dog going to cost?"
Mr. Loria said he also worried that the bidding drove up the price so high that the Angelos-DeWitt group may be cash-strapped -- especially with a proposed major-league revenue-sharing agreement that could cut into future Orioles profits.
These concerns had prompted another group of investors to quit a week ago. The Jemal brothers, who run the Nobody Beats the Wiz electronics discount chain, bowed out early.
The creditors, however, responded with broad smiles because the auction boosted the amount they will receive, although the high price will not pay all Mr. Jacobs' debts.
Before entering bankruptcy in late March, Mr. Jacobs had wanted to sell the team to the DeWitt group for $141.3 million. When he entered bankruptcy court, however, the team had to be auctioned off to ensure that creditors got as much money as possible.
"We certainly had hoped for this," said Tom Sperry, an official at Union Bank of Switzerland and co-chairman of the creditors committee. "It was our intention for the market to speak for itself, and it has."