"The sale of this franchise to Larry Dolan fulfills my strong desire to turn the team over to someone who is deeply committed to Cleveland and its tremendous fans," Jacobs said. "Larry and his family have the enthusiasm and strongest desire to continue the success of this ballclub well into the new century."
Dolan, 68, is the managing partner and president of a small law firm in the suburb of Chardon. Two of his sons, Paul and Matthew, are lawyers with the firm. Dolan reportedly has become wealthy through his ownership of stock in Cablevision Systems Corp.
Any agreement is subject to approval by major league owners, who have taken 6-18 months to consider recent purchase agreements. The Indians said the transaction is expected to close by the end of March.
The deal appears to be a record for a baseball franchise, topping the $311 million sale of the Dodgers last year from the O'Malley family to the Fox division of Rupert Murdoch's News Corp.
Dolan said owning the Indians was "a dream come true."
"Not only is ownership of this team a great honor, but it is also an incredible responsibility," he said. "One of the things that attracted me to this opportunity was my strong belief that the Indians organization is one of the best in baseball."
Under Jacobs' ownership, the Indians have turned from a last-place finisher to a team that has won the AL Central the last five years.
All that's been missing is a World Series title that would end a championship drought dating to 1948, when the Indians beat the Boston Braves.
Cleveland lost the 1995 World Series to the Atlanta Braves and was two out from winning the Series in '97 before the Florida Marlins came back to win Game 7 in extra innings.
Jacobs and his late brother, David, bought the struggling Indians franchise for about $45 million on Dec. 9, 1986. The team endured five straight losing seasons through 1993 while the organization placed greater emphasis on player development and scouting.
In 1994, the Indians moved into Jacobs Field and have sold out the ballpark since early 1995. The stadium will keep its name at least through the 2006 season, under the agreement.
The deal would ensure that, as Jacobs promised when he put the team up for sale in May, the Indians remain under control of Cleveland area interests.
It also would marks the end of Dolan's efforts to buy a professional sports franchise. Dolan and his brother, Cablevision chairman Charles Dolan, have been involved in unsuccessful efforts to buy the Cincinnati Reds and New York Yankees in baseball and the NFL's Cleveland Browns and Washington Redskins.
The Dolans ran second to Al Lerner in the bidding for the Browns. They brought in Hall of Fame coach Don Shula and comedian Bill Cosby to increase the attractiveness of their bid.
Cablevision is the majority owner of the NBA's New York Knicks, the NHL's New York Rangers and Madison Square Garden.
Jacobs, 74, offered stock in the Indians to the public in June 1998, although he kept the controlling interest.
Shareholders will receive between $22.25 and $22.75 per share. The deal is subject to shareholder approval, but since Jacobs controls the vast majority, that is a mere formality.
Net revenue for the Indians in 1998 totaled $144.6 million. The company completed its initial public offering and began trading on the Nasdaq stock market on June 4, 1998. The stock was sold initially at $15 a share and rose Wednesday to $20.62 on news that a sale of the team was imminent. The stock's previous high for the past year was $19.50.
"I am pleased that the shareholders who invested in this company's stock will be rewarded for the confidence they have demonstrated in the organization," Jacobs said.
The sale of the Indians caps a tumultuous week for the team in which batting coach Charlie Manuel was promoted to manager, replacing Mike Hargrove. Hargrove was fired last month after Cleveland blew a 2-0 lead in the playoffs and lost its first-round series to the Boston Red Sox.