Kroc Sells S.D. Padres to Developer Argyros - Buyer Currently Owns the Seattle Mariners but He Must Sell That Ballclub for Deal to Be OKd

SAN DIEGO — 

The Kroc Era in San Diego baseball drew to a close Thursday when it was announced that Joan Kroc had accepted an offer from Orange County developer George Argyros to purchase the Padres.

A purchase price was not divulged, but Kroc was reportedly asking between $50 million and $65 million for the National League club that her late husband, Ray, purchased for $12 million in 1974.

Argyros, owner of the Seattle Mariners of the American League since 1981, must sell that franchise because of a major-league rule prohibiting an individual from having an interest in more than one club.

The sale of the Padres is subject to approval of both leagues and Commissioner Peter Ueberroth. The transaction must be approved by three-fourths of the 12 National League owners and a majority of the 14 American League owners. The process may take as long as 90 days, and may not be concluded until an owners’ meeting in June.

Argyros, 50, decided to make his bid for the Padres because of their proximity to both his home and his other business interests.

“My decision is related to where I spend my time and where it makes sense to have my interests,” he said. “My family is my No. 1 priority. We live in Newport Beach and my businesses are in San Diego County and Orange County primarily. I couldn’t afford the time it took in Seattle. I couldn’t serve two masters.”

Argyros (pronounced arge-ewe-us) is involved principally in the development of apartments and commercial office space. He was a principal shareholder in AirCal, which is being sold to American Airlines.

Negotiations between Kroc and Argyros began several weeks ago, according to Argyros. He signed an offer a few days ago and it was finalized Wednesday.

Kroc had announced that the Padres were for sale in November, explaining that she wanted to be able to concentrate her time on charitable causes. She had inherited the club when Ray Kroc died Jan. 14, 1984.

Beth Benes, Kroc’s attorney and the Padres’ general counsel, conducted the negotiations. She said “many, many” parties expressed interest, but would not elaborate on any of the details involved in negotiations.

Kroc appeared only briefly at the beginning of the press conference introducing Argyros and his wife, Judie.

Commitment to San Diego

“We wanted to find a buyer committed to keeping the team in San Diego,” Kroc said. “At least three or four individuals were disqualified because they indicated interest in moving the franchise.”

Argyros, she said, assured her that the club will not be moved.

According to Argyros, nothing was included in the purchase agreement to prohibit the franchise from being moved. He said it was not necessary.

“We’re dealing with honorable people,” he said. “I wouldn’t sell Seattle if I was interested in moving a team. I hope to win the World Series right here with the San Diego Padres.”

The Mariners, whom Argyros purchased for $13 million, never came close to an American League West title in his six years as owner. Their highest finish was fourth place, and the club went through five managers in that period, the current one being former Padre Manager Dick Williams.

Technically, Argyros remains the Mariners’ owner and will not take charge of the Padres’ operation until the sale is approved.

This became clear when Argyros was asked about the possibility of acquiring free agent outfielder Tim Raines for the Padres--the first question Argyros was asked.

“I really can’t control that,” he said, “because I don’t own the team. It might take 90 days to get the transaction approved. Hopefully, we can get it done much sooner. The current owners are the owners until the franchise is sold.”

Conflict of Interest Issue

Should Argyros be approved as the Padres’ owner before he can sell the Mariners, provision would be made to avoid conflict of interest.

“It might be necessary, in fact, to put George’s shares (of the Mariners) in a trust and prohibit any trading or dealing between the two teams,” American League President Bobby Brown said.

In the meantime, Argyros said, the Padres will be in the hands of Kroc and Ballard Smith, the club president. He said any decisions, including whether to sign Raines, will be made by them.

Once the transaction is complete, Smith will step down as club president. He has held the position since 1979, but he has said he wants to pursue other business interests.

Argyros, who met with the front office staff after the press conference, said no sweeping changes are planned.

“I have high regard for (Executive Vice President) Dick Freeman,” he said, “as well as (General Manager) Jack McKeon. They will carry on in their current positions.”

Club executives, he said, will be given freedom to do their jobs.

“I really believe in choosing very good people,” he said. “I have a very direct relationship with my key executives, and I expect them to run the business. I get the best people, give them the support they need and then get out of the way. But I know where the buck stops.”

Lease Negotiations

A critical chore for the Padres these days is negotiating a new stadium lease, replacing the one that expires after the 1988 season. Negotiations are already under way, but Argyros said he would like some input in this regard.

“I want to take a good look at that,” he said. “Assuming this (transaction) goes through, I want to be involved in negotiating the lease with the city.”

Argyros has had a series of disputes with King County, Wash., officials over the lease terms for the Kingdome. At one point, he had threatened to move the team to another city unless the lease was renegotiated, which it later was.

On Thursday, he said it is important that a “community understands how important baseball is and baseball understands the importance of a good working relationship with the city.”

Under Kroc’s ownership, the Padres have had what might be called a mixed relationship with the city and fans. Indeed, but for Ray Kroc’s purchase of the Padres in 1974, the franchise would have been moved to Washington, D.C. The club hit its peak when it won the National League pennant in 1984, the first season after Ray Kroc’s death.

The most controversial year was 1986. The Kroc family members--owner Joan and son-in-law Smith--were at odds during the fiasco over whether or not Dick Williams would return as manager (He eventually left.). Smith suspended pitcher Rich Gossage because of remarks critical of the ownership. Pitcher LaMarr Hoyt was arrested three times on drug charges, and was finally released by the team after being sentenced to jail. Still lingering is the question of whether Raines will be signed.

Related stories in Part II and in Sports.