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SBD/September 19, 2012/FacilitiesPrint All
AEG has been “put up for sale, a move that could reshape the face of sports ownership in Southern California,” according to Hamilton & Vincent of the L.A. TIMES. The Anschutz Co. announced that it is “seeking a buyer for its AEG subsidiary,” which “owns and manages a wide range of sports and entertainment properties,” including the L.A. Live complex, NHL Kings, MLS Galaxy, O2 arena in London, the O2 World Berlin. AEG, which also has a minority stake in the Lakers, has been “negotiating to build a football stadium in downtown Los Angeles in the hopes of luring a professional team from another city.” Those plans are “expected to proceed.” A sale of AEG would “mark one of the biggest sports and entertainment deals on record.” Anschutz Co. President Cannon Harvey said that the process is “in an early stage and no bidders have been identified.” The company is “being advised by the Blackstone Group, the New York investment bank that represented Frank McCourt in his sale of the Dodgers.” A source said that “one potential bidder for some or all of AEG” is Lakers investor Patrick Soon-Shiong. Soon-Shiong “confirmed in a statement” yesterday that he is “interested in pursuing a purchase of the company.” AEG officials said that they “would have to be part of any deal.” AEG President & CEO Tim Leiweke said that he and his management team “recently renewed their contracts, which would require any new owner to keep them on or buy them out” (L.A. TIMES, 9/19).
SELECT AEG ASSETSNHL KingsThe Home Depot CenterGalaxyCitizens Business Bank Arena (Ontario, Calif.)Lakers (stakeholder)Best Buy Theatre (N.Y.)Dynamo (stakeholder)L.A. Live (Nokia Theatre)AHL Manchester Monarchs
AEG Global Partnerships (sponsorship sales,
naming rights, stategic partnerships)ECHL Reading RoyalsAEG Live (concert promotion, special events)ECHL Ontario ReignAEG MerchandisingStaples Centeraxs (ticketing, e-commerce)O2 arena (London)SELECT VENUES THAT AEG OPERATESAmericanAirlines ArenaO.co ColiseumAT&T CenterO2 World BerlinBarclays CenterO2 World HamburgBBVA Compass StadiumOracle ArenaConsol Energy CenterPrudential CenterFarmers Field (proposed)Rentschler FieldFedExForumRose GardenJobing.com ArenaSprint CenterKFC Yum! CenterTarget CenterMasterCard Center (Beijing)U.S. Bank ArenaMercedes-Benz Arena (Shanghai)XL Center
ALL OR NOTHING: Anschutz Co. execs yesterday said that they “plan to invite bids from a range of potential buyers, including private-equity firms and global entertainment, leisure or real-estate companies, and expect to wrap up a sale some time next year.” Harvey said that the company “isn't considering selling AEG in pieces.” He said, “We’re focused on selling it whole.” The WALL STREET JOURNAL’s Smith & Das, who first reported Anschutz Co.’s decision to sell AEG, noted the leagues in which company-owned teams play “all would likely need to approve any new owner of AEG’s professional sports holdings” (WSJ.com, 9/18).
FOOTBALL’S FUTURE: In L.A., Dakota Smith writes, “Despite the assurances from AEG, a sale could complicate plans to build a 72,000-seat stadium in downtown, since the buyer would have to agree to the city's terms over the project.” L.A. Mayor Antonio Villaraigosa said he was aware “for some time” that AEG was going up for sale. Villaraigosa, in a statement, said that he “speaks regularly” with AEG Chair Phil Anschutz and Leiweke. Villaraigosa: “I have the commitment from both of them that this won't affect plans for an NFL team to return to Los Angeles in the near future. And so [it] will not affect my support for moving ahead with Farmers Field and the Convention Center site” (L.A. DAILY NEWS, 9/19). L.A. City Council member Jan Perry said, “The city has been well-negotiated and well-protected. I don't think this is a setback.” In California, Scott Reid noted the “reasons behind the decision to sell AEG were unclear” yesterday. What is “certain” is the price tag for AEG will “likely run well into billions of dollars” (ORANGE COUNTY REGISTER, 9/19). ESPNLA.com’s Arash Markazi noted at some point in the near future, Leiweke will likely “come out and say the day-to-day operations of AEG will not change in the interim and the company remains committed to Farmers Field and bringing the NFL back to Los Angeles.” Markazi wrote, “Of course, that commitment is only as strong as the commitment of AEG's new owner. If that person is just as committed to the project as Leiweke is, it will continue; if he or she isn't, well, it will die as so many NFL stadium proposals in L.A. have over the past two decades” (ESPNLA.com, 9/18).
FINISHING THE JOB: In L.A., Vincent Bonsignore writes, “I never got the feeling Anschutz truly felt the stadium proposal AEG president Tim Leiweke was pushing on him would ever get as far as it has.” Anschutz “kept telling Leiweke that he had his blessing, while never truly thinking Leiweke would navigate through all the political red tape and potholes in his way to actually get it to this point.” Now that Leiweke has “carried the ball to the goal line, maybe Anschutz isn't as ‘in’ as we thought as he's ready to hand it off to someone who is prepared to carry the ball into the end zone” (L.A. DAILY NEWS, 9/19). Also in L.A., T.J. Simers notes considering how NFL Commissioner Roger Goodell has “brokered deals in the past,” it would not be a surprise if he has “already met and given his full blessings to Soon-Shiong.” If so, it “makes this mega AEG sale all about football and the construction of a new stadium in downtown Los Angeles.” Anschutz has “never really had an interest in football here.” The stadium has “always been Tim Leiweke's baby,” except for “one itty-bitty problem: He's never been the money guy.” The NFL has had “every chance" to go with Majestic Realty Chair Ed Roski's ready-to-build project in the City of Industry, "but obviously it has been waiting for the downtown project to take shape.” When Anschutz “finally agreed to go all in on the stadium, he took it upon himself to negotiate with other NFL owners without Leiweke's assistance” (L.A. TIMES, 9/19).
After "more than a decade of talk, work is expected to begin this fall" on the 10-acre Ballpark Village project adjacent to Busch Stadium, and officials are "aiming for a spring 2014 opening date," according to a front-page piece by Elizabeth Crisp of the ST. LOUIS POST-DISPATCH. The Missouri Development Finance Board yesterday "approved its share of $17 million in state and local incentives for the first phase of the project -- one of the final steps before construction could start." Cardinals President Bill DeWitt III said, "It's been a challenge." Crisp notes future phases of the project also "could receive city and state subsidies -- up to $183.5 million total -- as long as benchmarks on retail, office, residential and other offerings are met throughout Ballpark Village's completion." The first phase of Ballpark Village is a "dramatically scaled-back plan from the original concept and covers only two of the project's eight square blocks." It will "include a Cardinals Hall of Fame, Anheuser-Busch-themed restaurant, shops and an event plaza with a retractable roof to host concerts and other programs." Other tenants are "expected to be announced in coming weeks." DeWitt said, "I think there will be a lot of interest, and some of those conversations we've had over the years will pick up once we start turning dirt and get to work." Crisp notes, "Under the latest outline, office space could be added in phase three and the first residential units in phase four." Those are "targeted for 2016 and 2017, respectively" (ST. LOUIS POST-DISPATCH, 9/19). The Cardinals yesterday announced that they anticipate breaking ground on Ballpark Village in mid-November. The first phase of the project will be called Cardinals Nation, and will total over 30,000 square feet on three levels. Among the features at Cardinals Nation are a two-story restaurant and a 300-plus-seat deck with views into Busch Stadium (Cardinals).
Edmonton Mayor Stephen Mandel said that Oilers Owner Daryl Katz “now has no choice but to come before council and publicly state exactly what he wants from the city and taxpayers to move ahead on a downtown arena deal that seems to be falling apart,” according to a front-page piece by Elise Stolte of the EDMONTON JOURNAL. Mandel said of the negotiations, “I think that Mr. Katz’s memory of the history is different than mine. I think council has been incredibly responsive, but I no longer can define what Mr. Katz is asking for or what he’s not asking for.” Council member Tony Caterina said that the Katz company’s “new demands aren’t just for more capital dollars and an ongoing [C$6M] subsidy for the proposed arena.” Caterina: “They don’t want to pay taxes. They want help now in operating the arena. … If everybody knew exactly what these new positions were, I think everyone would have seen it as council saw it, which is very unreasonable.” He added that the request not to pay taxes "is a non-starter.” Katz on Monday “made an impassioned appeal to close the deal with city council as soon as possible.” The Oilers owner yesterday “echoed those remarks” on the radio program “Oilers Now,” saying that the city “committed to ‘help facilitate’ an arrangement with the province for casino gaming revenue that would help him cover the operational costs of the arena” (EDMONTON JOURNAL, 9/19). City of Edmonton Manager of Corporate Properties Rick Daviss said that officials “will return to the city with a detailed design for the project at the maximum price by early 2013.” In Edmonton, Angelique Rodrigues notes the Oilers’ current lease at Rexall Place "expires in 2014” (EDMONTON SUN, 9/19).
LET'S DO THE DEAL: In Edmonton, Terry Jones writes, “The problem here isn't a populace which doesn't want an iconic state-of-the-art downtown arena to keep the Oilers in Edmonton for the next 35 years,” nor is it Mandel, “a mayor who recognizes three decades of a city allowing itself to lose the vision to be a great city. He’s a builder.” The problem is that “they're not on the same page or speaking the same language.” Jones writes it is a deal that "HAS to get done." It is "too far down the road to turn back even if Edmonton wanted to, which it clearly doesn't” (EDMONTON SUN, 9/19).
Nashville city officials are "nervously watching the labor impasse between the National Hockey League and its players, knowing that they still have to write checks to the Nashville Predators even if there’s no hockey season," according to Josh Brown of the Nashville TENNESSEAN. Under terms of the city's agreement with the team, the city "will still be on the hook for millions of dollars in subsidies to the Predators even if the games don’t resume." The city has an "obligation to provide the team" up to $8.6M per year. That money "comes in the form of subsidies and fees for management of the arena." Nashville also "pays the team incentives for booking other acts at the venue, some of which generate revenue for the city that won’t be lost to the lockout." In addition, the city "receives sales tax revenue from the games and other events." If some games are canceled or the entire season called off, Nashville "would take a hit in the revenue it receives from ticket and concession sales at hockey games." Nashville District Energy System Liaison Bob Lackey said that the city last year "received a little more than $4 million in state and local tax from the games." Nashville City Council member Lonnell Matthews Jr. said, “We’re hoping that the lockout doesn’t actually cancel the season and that we’ll be able to reap some of the benefits.” He added that lost tax revenue from games "could cause a shortfall that would have to be covered somehow" (Nashville TENNESSEAN, 9/19).
OFF THE HOOK: In Columbus, Josh Jarman writes Franklin County (Ohio) taxpayers "have little on the line in the dispute, even though they now own Nationwide Arena." The lockout "will not cost taxpayers or the Franklin County agency that owns the arena anything because the public receives no revenue from hockey games -- not from concessions, parking or tickets." That money all goes to the Blue Jackets, "who were the main benefactors in a deal brokered late last year to have the city and county split the cost of buying and operating the arena, and allow the team to play there rent free." Blue Jackets VP/PR Todd Sharrock said that "not having to pay rent during the lockout puts the team in a better financial situation than during the 2004-05 season lockout." But he added the team "would bear the financial burden of any canceled games as it did eight years ago" (COLUMBUS DISPATCH, 9/19).
Marlins manager Ozzie Guillen has spoken out against players who have “grumbled amongst themselves all season” about the dimensions of the new Marlins Park, according to Joe Capozzi of the PALM BEACH POST. Guillen said, “We’ve got to deal with the ballpark, and we’re going to be negative coming in here every day, ‘Oh, this ballpark is too big’?’’ He added, “We’ve got to play in this ballpark 81 games and I don’t want to hear any more (from) my players, my hitting coach, nobody with this uniform worry about this place (being) too big. If they think this place is too big, let me know. I’ll put somebody else in who can hit bloopers behind shortstop.” Guillen said, “We are not in last place because this ballpark is big.” He “dismissed the suggestion that the dimensions will make it hard for the Marlins to sign free-agent power hitters.” Guillen: “That’s a bunch of crap. I guarantee you, you give them $100 million, they will play here” (PALM BEACH POST, 9/19). In Miami, Greg Cote grades the Marlins, giving the franchise a “C-minus.” Cote writes Owner Jeffrey Loria, President David Samson and Guillen “lead the major leagues in ego and noise.” In “on-field results, not so much.” Cote: “The Marlins have a beautiful new stadium and therefore a solid, long-term future in Miami, and for that this regime deserves credit. It is the only reason our grade isn’t appreciably lower” (MIAMI HERALD, 9/19).
IMPROVED ATTENDANCE: In West Palm Beach, Capozzi noted the Marlins will “end their first year at Marlins Park with attendance of at least 2 million,” a mark they reached Monday. The Marlins have reached 2 million fans “just twice in franchise history," and this year's current mark of 2,002,047 is the "most since they drew 2,364,387 in 1997 at Sun Life Stadium,” the season in which the Marlins won the franchise's first World Series. The first season at Marlins Park still has been “somewhat of a disappointment because team officials had predicted average crowds of at least 30,000.” Through Sunday, the Marlins are “averaging 27,482, 12th among the NL’s 16 teams and 18th among 30 major-league teams.” However, this season has been a “huge success compared to the crowds they drew at Sun Life, where the Marlins were frequently last in the league in attendance.” Last year they averaged 19,747 (PALM BEACH POST, 9/17).