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Ratner’s Ohio family chips in
Cleveland relatives buy Bruce’s Brooklyn company
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del.icio.usBruce Ratner has called in the big guns — his cousins Charles and Albert — for a cash infusion just as his Atlantic Yards development nears state approval.
Ratner announced last week that he is planning to sell all his shares of his firm, Forest City Ratner Companies, to Forest City Enterprises, the publicly traded behemoth founded by his grandfather in 1921 and run by his two cousins.
In exchange for giving up ownership of the company, Ratner would receive $60 million and 3.9 million shares in a new Forest City limited liability company.
The corporate restructuring — FCE already owned a majority stock in Ratner’s Brooklyn-based affiliate — puts his family’s $8-billion corporation squarely behind Atlantic Yards.
If the deal goes though, FCE stockholders would own a much-larger piece of Ratner’s ambitious project.
The intra-family deal left everyone from Internet instapundits to Atlantic Yards opponents trying to decipher the tea leaves.
“Decent move today,” proclaimed a Yahoo instant-messenger named Richmanspoor, calling FCE stock a “strong buy.”
But opponents of Atlantic Yards worry that profit-interested stockholders — most of whom live far from the neighborhood where the arena and surrounding complex would have its greatest impact — will want to squeeze every penny of profit out of the $4.2-billion development.
“This is going to put pressure on the company to make sure [Atlantic Yards] is a good deal for stockholders,” said Develop Don’t Destroy Brooklyn spokesman Daniel Goldstein.
Project designer Frank Gehry admitted as much back in April, when he told the New York Times that Ratner took his responsibility to FCE stockholders seriously.
“He’s a public company,” Gehry said, “so it’s got to work.”
A spokesman for FCE said that the proposed restructuring would have no effect on the publicly subsidized project.
“Forest City intends to conduct its New York operations in the same manner as it has for the past 20 years,” the Cleveland-based company said in a statement.
©2006 The Brooklyn Paper
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