SBD/November 3, 2011/Franchises

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  • Suitors Begin Lining Up For Dodgers With Price Tag Possibly Surpassing $1B

    Selling the Dodgers could take months, lasting into the start of next season

    The winning bidder to buy the Dodgers is expected to pay Owner Frank McCourt “in excess of $1 billion for the team, its stadium and the surrounding parking lots,” according to Wharton & Shaikin of the L.A. TIMES. Sports marketing experts said that “that kind of money could attract wealthy foreign bidders or force prospective owners to join forces,” as the Dodgers “still possess plenty of allure.” SportsCorp President Marc Ganis said, "Owners can come out of the blue. You might not have heard of them." Ganis said, "Baseball needs the Dodgers to be owned by a very well-capitalized person or group. That means an owner who invests hundreds of millions of dollars." Former Dodgers Owner Peter O'Malley said that he “wants to return as the team's chief executive and will work on forming an ownership group.” The O'Malley family owned the Dodgers “for nearly half a century.” Penguins co-Owner Ron Burkle, a “Southern California supermarket magnate” said, "It is one of the best brands in all of sports. And, like many people, I'd be very proud to be a part of its future." Any discussion of potential bidders “must also include” Mavericks Owner Mark Cuban, who “offered to buy the Dodgers several months ago but balked at the hefty price tag.” But he “did not rule out a future bid.” In terms of experience, Burkle “would be equally qualified.” KB Home Founder Eli Broad and Oracle CEO Larry Ellison “would meet the wealth criterion.” News Corp. President, COO & Deputy Chair Chase Carey yesterday said, "We are not buying the Dodgers." Time Warner, which plans to create two RSNs with the Lakers, “declined to comment.” But sports business experts said that “either one of the television entities could end up being involved in the Dodgers purchase as a minority owner, contributing enough money to secure rights.” Other potential front men include White Sox consultant Dennis Gilbert, Brewers Owner Mark Attanasio, Basketball HOFer Magic Johnson and “two former Dodgers -- Steve Garvey and Orel Hershiser” (L.A. TIMES, 11/3). 

    NAME YOUR PRICE: NYU Tisch Center sports business professor Robert Boland said that the bidding for the team, Dodger Stadium and other assets “should start at $1 billion, which would exceed” the MLB record of $845M paid for the Cubs. Boland: “This is one of the sports properties anyone looking to buy a team would want” (N.Y. TIMES, 11/3). Sources said the “most likely model for the team's new owners will be something similar to the group that bought the Texas Rangers out of bankruptcy in 2010.” In that case, a group of “wealthy Texas energy executives formed a group led by Hall of Fame pitcher Nolan Ryan, a minority investor” who is now the team's President & CEO (WALL STREET JOURNAL, 11/3).

    THE SUITORS: In L.A., Jill Painter notes Garvey, Hershiser, Gilbert, Cuban, former Dodgers GM Fred Claire, Fox and Time Warner “and a couple of billionaires are positioning financial backers.” Garvey said, "For us, it's all about the Dodgers and baseball. It's a baseball acquisition." He added, "Most of these groups are wanting to acquire the Dodgers as a real-estate deal. They'll want to build a stadium right away or move it or it's about the TV rights." Claire reportedly is “aligned” with former A’s and 49ers exec Andy Dolich and “former Dodgers batboy Ben Hwang.” Claire posted on his Facebook page, "Our goal is to restore the Dodgers to the rightful place of leadership in the community, in Major League Baseball and on the international level." Gilbert “still hasn't officially made his interest known.” But a source yesterday confirmed that he “still wants to buy the Dodgers.” It is unclear “who he has lined up in his investment group” (L.A. DAILY NEWS, 11/3). Cuban yesterday in an e-mail wrote, "It all comes down to price. It's important to have more than enough money to pay players and invest in the organization." Claire said, "I've been working on this venture since early July. My motivation is to see the Dodgers be what they need to be in the community" (ESPNLA.com, 11/2). There was “big buzz” that Red Sox Chair Tom Werner was “interested in making a run” at the Dodgers. But Werner yesterday said that “he’s not interested in the Left Coast team.” Werner: “I am very happy in Boston” (BOSTON HERALD, 11/3). YAHOO SPORTS’ David Brown notes Fox News’ Greta Van Susteren last night interviewed Donald Trump on "On The Record" and “basically, she begged The Donald to buy” the Dodgers. Van Susteren has been “fixated on this topic for the past 48 hours or so, earlier putting forth the noble, if far-fetched idea of having the Los Angeles community buy the Dodgers” (SPORTS.YAHOO.com, 11/3). In L.A., Tom Hoffarth reports Beverly Hills real estate developer Stanley Stalford Jr. sent out an e-mail yesterday “to all who've signed up as a member of his OwnTheDodgers.com website.” If he can “get two million shares sold at $500 a pop within the next few weeks,” he can provide MLB Commissioner Bud Selig “with an all-cash, debt-free payment to purchase the Dodgers and move ownership into the brave, new world of citizens' dominion” (L.A. DAILY NEWS, 11/3).

    CUBAN FLARE: Dallas Morning News columnist Tim Cowlishaw noted Cuban "might be interested" in the Dodgers, as he "doesn't have a lot going on in basketball right now." Cuban's involvement "depends on everything that's involved with the TV contracts and all" ("Around The Horn," ESPN, 11/2). But N.Y. Daily News columnist Bruce Harper said, "Baseball owners are worried about him coming in and spending a ton of money. He’d be good for the game in terms of reviving that franchise, but they’d hate to see what he would do without a salary cap.” N.Y. Daily News columnist Bruce Murray: “He’d outspend the Yankees” (“Daily News Live,” SportsNet N.Y., 11/2). ESPN’s Tony Kornheiser noted MLB “is afraid of Mark Cuban because he’s be considered a maverick owner and troublesome for some commissioners, such as David Stern" ("PTI," ESPN, 11/2).

    STATING THEIR DEMANDS: An L.A. TIMES editorial states the city “deserves a team owner who can provide everything that a billion-dollar, storied franchise and its fans deserve.” A “new owner (or co-owners) should be savvy enough to know when and how to invest in the team's best interests.” And they “should be financially stable and secure enough to plow profits back into the team, and not to have to use the Dodgers as a personal cash cow, as Frank and Jamie McCourt were accused of doing.” Whether the Dodgers “are bought solely as a business interest or out of love for the game, the owner must make the team the priority -- or put someone in charge who will” (L.A. TIMES, 11/3). ESPN’s Michael Wilbon said, “They need a bounceback. They need a guy who’s going to make that franchise relevant again, because they’re irrelevant” (“PTI,” ESPN, 11/2). In L.A., T.J. Simers writes, “Although I understand anybody is going to look fantabulous in comparison with the McCourts, it's no time to give the next owner a free pass.” It was the fans of L.A. “who held McCourt accountable for being a wreck as an owner,” so why not “remain demanding?” (L.A. TIMES, 11/3). ESPN's Bomani Jones noted McCourt is "dead broke,” and the "problem is we just have to hope that the next owner isn’t dead broke." Jones: "You can’t guarantee these things.” ESPN’s J.A. Adande said, "As McCourt showed when he bought the team from Fox, there’s no guarantee that when you sell the team it’s going to get better for that team overall” ("Around The Horn," ESPN, 11/2). 

    PROPS TO SELIG? In L.A., Bill Dwyre writes under the header, “Bud Selig Is The Winner In A Game Of Risk.” What Selig did with the Dodgers "should be an image game-changer," and how and where he closed the deal “is even more revealing, and fitting.” Selig on Tuesday evening, hours before the sale announcement, was “sitting in a banquet room at the Westin Bonaventure Hotel in downtown Los Angeles, there to make the keynote address at a function sponsored by the Boy Scouts of America, Los Angeles Council.” He said, "It was about 9:30 when we got the word. It was pretty hectic." After Selig was told of the agreement to sell the team, he then “had to get up and make a speech.” Selig: "That was a little difficult." Dwyre writes, “For Selig, the successful conclusion of negotiations with McCourt had to be a career highlight. … The risk he took against McCourt should not be overlooked, especially because it was taken by a man who operates by careful decision-making and consensus-building” (L.A. TIMES, 11/3). Also in L.A., Vincent Bonsignore asks if Selig “can make an error in judgment as egregious as he did on McCourt, how can we be sure he won't make a similar mistake this time around?” Bonsignore: “The last thing we need now is Selig sticking to his old-school roots and handing the second-biggest market in the country another dreadful owner. … Selig needs to do right by Los Angeles” (L.A. DAILY NEWS, 11/3).

    Print | Tags: Franchises, Los Angeles Dodgers
  • Ownership Uncertainty Creating Unstable Environment For Dodgers

    At end of season, McCourt told Colletti payroll would be similar to this year's

    The latest development in the Dodgers' "ownership saga has resulted in more confusion in what already felt like an unstable environment,” according to team officials cited by Dylan Hernandez of the L.A. TIMES. Several sources said that they “had no idea how the franchise would be affected in the coming weeks and months” after the news that Owner Frank McCourt has agreed to sell the team. One official said, "We're just following the plan until we're told not to." Hernandez reports McCourt "hasn't informed the baseball operations department of any change in course.” Dodgers GM Ned Colletti said that in the final days of the regular season he “was told by McCourt that the Dodgers' payroll would be similar to what it was this year.” McCourt is “expected to meet with Colletti in the near future.” With a sale process expected to take months to complete, some player agents said that they “didn't expect the Dodgers to be significant players in the free-agent market.” One former high-level MLB exec “recalled being under severe restraints when he worked for a team that was in the middle of the sales process.” The agents for CF Matt Kemp and RF Andre Ethier, who will be free agents after next season, “wondered how the impending sale would influence the team's negotiations with their clients.” Dave Stewart, who represents Kemp, said, "There's a lot of uncertainty, a lot of questions." Ethier's agent, Nez Balelo, said that he “thought he didn't know enough about the situation to speculate how the Dodgers' present situation would affect negotiations with his client” (L.A. TIMES, 11/3). ESPN's Keith Law said the sale of the team will not take place "near soon enough for Ned Colletti to go out and make major, major moves this off-season, which I guess could be a good thing or a bad thing depending on what you think of Ned Colletti.” ESPN’s Eric Karabell: “They’re probably not going to be in play in spending a lot of money because I don’t expect this to get done this calendar year. It’s going to take time. ... How are you going to buy a baseball team for a billion dollars in a month?” (“Baseball Today,” ESPN.com, 11/2).

    TIMING IS EVERYTHING: USA TODAY’s Bob Nightengale notes MLB attorneys said that it “likely will take at least two months for the sale process to even start.” MLB “still has the right of final approval, but McCourt has the freedom to sell the club to a group or individual he chooses” (USA TODAY, 11/3). In L.A., Bill Shaikin notes MLB “does not have to accept a particular bidder but has agreed to pre-approve potential buyers.” The league has “agreed to expedite the process by completing all investigations and conducting voting on eligible bidders before an auction,” which means the high bidder “becomes the winning bidder, and McCourt gets his money faster.” McCourt's bankers “have yet to propose their sale plan to the Bankruptcy Court.” However, it “appears more likely that the auction would be held behind closed doors rather than in open court” (L.A. TIMES, 11/3).

    Print | Tags: Franchises, Los Angeles Dodgers
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