Was Lindner Unlucky or Unwilling as Reds Owner?

Carl Lindner won't go into the books as the greatest owner in Reds history, which is an unfortunate lack of achievement for one of the wealthiest fellows this town has ever seen. Because of his r

Jerry Dowling

Carl Lindner won't go into the books as the greatest owner in Reds history, which is an unfortunate lack of achievement for one of the wealthiest fellows this town has ever seen. Because of his riches, the likelihood that he'll be remembered for tightness with the buck stands as the greatest threat to his legacy.

And that would be unfair. To a point.

The obvious notion that Lindner beefed up payroll this year to grease a contender and attract a buyer drew partial confirmation last week when Cincinnati businessman Robert Castellini, a Lindner crony, stepped up with a group to buy the club's controlling shares. The confirmation is only partial because the payroll hike backfired in a manner characteristic of Lindner's regime.

By the paper-thin accounts from the channels through which Cincinnati's blue blood flows, Castellini's ownership is "good news" for Reds fans, whatever that means. The Sunday Enquirer quoted developer Arn Bortz saying Castellini can't stand for fifth place in a squash tournament; imagine how sixth place in the NL Central would feel. But does that mean he'll avoid it?

If the good news is supposed to consist in Cincinnati ownership, that really means nothing except that a wealthy Cincinnati interest will steward the club and keep it in Cincinnati, which doesn't mean fans here will be cheering a winner anytime soon.

If Castellini operates the Reds under the pretense that keeping ownership local is a big favor to the people, then it's still a long way to the light at the end of the tunnel, if there is one. Maybe he has more in mind. He has to know Lindner's image took a beating from his performance with the Reds. He also has to know Lindner's accounts won't suffer terribly for the experience.

The Reds said last week the sale is based on an enterprise value of $270 million for the franchise (enterprise value equals market capitalization plus cash minus debt). In other words, the franchise probably is worth around $350 million before considering stadium debt, the remaining years on multi-year contracts and outstanding deferred payments to players.

Castellini's group includes brothers Thomas L. and W. Joseph Williams, whose father and uncle were the principal Reds owners during the dreadful early 1980s before giving way to Marge Schott. It's reported the group will buy 70-80 percent of the Reds. If it's 75 percent, we can figure the group will fork over about $200 million. Controlling shares included, Lindner owns 37.5 percent of the club, which is worth about $100 million.

Suppose Lindner sells all but 10 percent. He'd pocket $90 million after his group spent $67 million for most of Marge Schott's shares in 1999. So Lindner could profit to the tune of about $20 million for all his trouble and still own 10 percent of the club.

From the start of trading on Oct. 1, 1999 (the day Lindner assumed control of the Reds) until the start of trading on Nov. 4, 2005 (the day his sale to Castellini was announced), the Dow Jones Industrial Average gained all of 135 points to 10,470, a little more than 1 percent. But if Lindner's $67 million investment for control of the Reds now is worth $100 million, it returned 50 percent during that same period. He's made worse investments.

Assuming Lindner keeps 10 percent, $20 million over seven years isn't a windfall by big league standards. The Reds couldn't have signed Eric Milton to a three-year deal for that kind of money. Ballparking the Reds' operating costs around $70 million per year, $20 million over seven years is roughly a 4 percent profit margin. Which means Lindner wasn't going to add more players without spending his own money.

That's an important point to remember for those who look to the St. Louis Cardinals, with whom Castellini and the Williams brothers are minority owners, as a model for how they'll run the Reds. The St. Louis market is considerably larger to begin with, and it's become an even stronger baseball market in the past 15 years while the Cincinnati baseball market has weakened.

So Castellini is going to have to spend his money, not market money, to run $70 million payrolls. And his money isn't Lindner money. Lindner didn't spend it. Castellini might not have it.

Lindner's true home in Reds history is as their most unlucky owner, which isn't to let him off the hook for the club's worst sustained performance in more than half a century. A man of his age, 86, might have learned in his youth about making one's own luck from the Depression-era success literature of Dale Carnegie and Napoleon Hill. Lindner made some of his own luck, too.

He especially made his luck bad during summer 2003, overseeing the breakup of a charming ball club in a brand new park, setting world records for callousness, if not incompetence. In aggregate, Lindner oversaw four trades that brought no more than Aaron Harang and Brandon Claussen to the Reds in exchange for Aaron Boone, Jose Guillen, Scott Williamson and Gabe White. And they saved the Reds a few "nickels," in Lindner's vernacular.

Two years later the trades don't look quite so terrible. The Reds traded two hitters they didn't need this year for two starting pitchers who might still become big winners. But the Reds lost so much credibility in the process that they couldn't hold their fans while staying on the rebuilding path those trades initiated.

So the Reds beefed up their payroll by signing Milton and Ramon Ortiz at the combined 2005 contractual obligation of $8.9 million. Milton and Ortiz should have led the staff. Instead, they combined for 64 starts, 357 2/3 innings, a 17-26 record and a 5.93 ERA. For only a combined $760,000, Harang and Claussen took 61 starts, 380 1/3 innings, a 21-24 record and a 3.96 ERA.

That's how seven years of Lindner have worked out. When he slashes payroll, he takes an image beating because he doesn't duly consider public relations. But when he spends for payroll, it's partially motivated by public relations and it backfires.

Between Junior Griffey, Barry Larkin, Milton and Ortiz, Lindner has taken the hook for about $115 million so far, with only two decent seasons (Griffey in 2000 and 2005) to show for it. We wanted him to spend more?

Well, at least he could have. But we can't be sure that Castellini can.

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