Monday, July 07, 2008


KBO gives Heroes hard and fast deadline

The Korea Baseball Organization has issued an ultimatum to the Woori Heroes: pay up or prepare to be kicked out of the league.

After they failed to pay the first installment of their expansion fees, 2.4 billion won ($2.3 million), by Monday’s deadline, the Heroes on Tuesday said they would pay only if certain demands were met. The total fees are 12 billion won, but after making a 10 percent down payment in February, the Heroes, who replaced the financially troubled Hyundai Unicorns to start this season, were to pay off the rest over a two-year span.

The league and the club sat down until the wee hours yesterday morning but couldn’t reach a compromise. Lee Jang-seok, the Heroes’ team president, told KBO secretary general Ha Il-sung that he preferred to pay 1.2 billion won by yesterday and cover the rest at a later date. But Ha did not budge and set the deadline for all 2.4 billion won on July 7.

“The Heroes will have to shell out that money by next Monday, no matter what,” Ha said. “If not, we will have no choice but to proceed in accordance with our rules.”

According to KBO rules, a team that fails to honor expansion fees can be expelled from the league if two-thirds of the owners agree.

In that case, the KBO would seek new ownership for the Heroes for 30 days while the team is under league control. In a worst-case scenario, if no prospective owner steps up, the team will disband in the middle of the season in what would be an unprecedented move in the KBO’s 27-year history.

Coaches and front office employees will become jobless, though some players could enter the waiver wire draft and be rescued by existing clubs.

“Paying the expansion fees is mandatory,” Ha said. “Any attempt to attach strings to it will not be tolerated.

The Heroes’ demands include the KBO’s guarantee of their membership in the league and the right to manage their home park, Mokdong Stadium, which is currently owned by the Seoul metropolitan government and for which the Heroes pay daily rent.

The Heroes also argued that since the renovation work at Mokdong, which had previously been used for amateur baseball, has cost 4 billion won, that amount should be deducted from their 12 billion won expansion fees.

Lee, the Heroes’ president, recently asked other team presidents if the deadline for the payment could be pushed back until after the All-Star break on Aug. 3 but that idea was quickly shot down.

The KBO planned to use the 2.4 billion won to cover a severance package for former Unicorns employees and to pay some remaining signing bonuses.

Executives from other KBO teams agreed that the Heroes must abide by the rules. Lee Sang-gu, general manager of the Lotte Giants, said when the Heroes missed the payment deadline, he got the impression that the team didn’t respect professional baseball in Korea.

“I don’t care what kind of situation they’re in,” Lee said. “They have to honor the agreement on expansion fees.”

Yoon Jong-hwa, general manager of the Hanwha Eagles, said a professional sports team has to “adhere to certain ethical standards.” Doosan Bears’ general manager Kim Seung-young opined, “A team must do its duties before it can ask for its rights. Paying expansion fees should be unconditional.”

Kwon Si-hyung, secretary general of the KBO Players’ Association, said he trusts the league and the Heroes to settle the issue.

“We will wait until next Monday to see how this unfolds,” he said. “We would like to see a peaceful resolution to this matter.”

The Heroes, meanwhile, issued a press release yesterday saying they still intend to run the baseball franchise. The statement also said the team will ask the KBO for another round of negotiations at a yet-to-be-determined date.

By Yoo Jee-ho Staff Reporter/ Kim Seek JoongAng Ilbo []

Heroes to pay, but Woori Tobacco wants to part company
July 07, 2008
After nearly a week of playing hard ball, the Woori Heroes and the Korea Baseball Organization suddenly turned amicable over the weekend.

The Heroes, which failed to pay the 2.4 billion won ($2.3 million) on June 30 as part of their 12 billion won league expansion fees, announced Saturday that they would make the payment today unconditionally. Over the past week, the Heroes, which joined the KBO this year in place of the financially troubled Hyundai Unicorns, had maintained that they would only pay if certain demands were met.

Then on Thursday, the team decided they would pay the money after all, and the payment date was determined on Saturday.

In response to the Heroes’ demands, the KBO had argued that the expansion fees are non-negotiable and had set the deadline today. The KBO had also warned that if the Heroes didn’t honor the commitment, the franchise’s existence would be in jeopardy.

But after the meeting held at a Seoul hotel on Saturday, the two sides came out cordial.

Representing the KBO were secretary general Ha Il-sung and Lee Sang-il, director of general affairs. For the Heroes, team president Lee Jang-seok, senior director Namgung Jong-hwan and general manager Park Noh-jun were on hand.

Ha attributed last week’s events to a communication breakdown.

“I think there have been a lot of unnecessary misunderstandings over the course of our conversations in the recent past,” Ha said. “I don’t think there was any intention on the Heroes’ part not to pay the fees.”

Among the demands of the Heroes was a guarantee by the KBO of league membership. Ha said, “We explained to them that by the terms of our regulations, they are guaranteed as a member of the KBO.”

The Heroes’ general manager Park, who had remained mostly mum on the subject, said, “I think we should’ve explained more to each other about our respective situations.”

After joining the league for the 2008 season, the Heroes were scheduled to pay their 12 billion won in fees over a two-year period. They had made a 10 percent down payment in February and were scheduled to shell out 2.4 billion won on June 30 and 2.4 billion won on Dec. 31 and then 3 billion won each on June 30 and Dec. 31 next year. It was the first such arrangement in the KBO’s 26-year history.

In another blow to the Heroes, Woori Tobacco, the local firm who lent its name to the Heroes in a three-year, 30 billion won contact, announced Friday that it no longer wants the Heroes to use the name Woori. The Heroes, however, maintain it will be difficult to change the name in the middle of the season.

Woori Tobacco had paid for the rights to advertising on uniforms, team’s logos and on advertising boards at the home park, Mokdong Stadium. The company complained last week that its corporate image and sales had taken a beating because of the sponsorship connection with the team.

By Yoo Jee-ho Staff Reporter/ Kim Seek JoongAng Ilbo []

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