SBD/February 21, 2014/Franchises

MLS Buys Chivas USA, Insisting Next Owner Must Build Soccer Stadium In L.A.

Chivas USA will still play at StubHub Center for at least the '14 season
MLS on Thursday announced that it has purchased Chivas USA from Jorge Vergara and Angelica Fuentes. The league will assume responsibility for operating the club, effective immediately. In the coming months, MLS will look to resell the club to a new ownership group that intends to build a new stadium and keep the team in L.A. The league has had initial discussions with potential owners and intends to finalize a sale sometime this year. An interim club President will be named shortly (MLS). MLS Commissioner Don Garber said the league paid "market price" for the club. Chivas USA will "continue to play at StubHub Center for at least the 2014 season, and possibly longer, if necessary" (MLSSOCCER.com, 2/20). In L.A., Kevin Baxter reports while Vergara and Fuentes "will retain all licensing rights to the Chivas name and the logo, the MLS-owned team will continue using the Chivas USA brand on a transitional basis." Vergara was part of the ownership group that founded the franchise in '05, but the team "has fallen on hard times lately." Vergara and Fuentes "bought out their original partners in August of 2012 but that did little to bring stability." It was a "well-known secret in MLS circles that the league office was involved behind the scenes in much of the club's affairs in an attempt to make it a viable franchise" (L.A. TIMES, 2/21).

CONCEPTUAL CONUNDRUM: Garber on Thursday said of Chivas USA's origin in relation to its Liga MX sister club Chivas de Guadalajara, "The original plan which we came up with in 2004 and executed in '05 was to extend one of soccer's most venerable brands into the United States. ... Ultimately the concept didn't work out. I came up with the idea with folks here at the league. I don't believe it was the concept as much as there was some executional issues.'' Garber said that the new ownership group "must intend to build a new stadium, and he mentioned the site of the L.A. Sports Arena as a possibility." The AP reported David Beckham "was not considered a possible buyer." Garber: "I wonder if he would have thought differently if his option execution date was a year from now versus a year ago" (AP, 2/20). Garber indicated that MLS Rapids Owner Stan Kroenke "will not be buying the team." In Philadelphia, Jonathan Tannenwald noted MLS has "historically had individuals or enterprises own multiple teams in the league." But Garber said that MLS "wants that practice to end." He admitted it is "ambitious" to try to find a new owner by the end of '14, but added "that is the goal." Tannenwald wrote it will "go down as a coincidence that the Chivas USA sale happened on the same day MLS confirmed that a discrimination lawsuit filed against the club by two former assistant coaches has been settled." Meanwhile Garbers said that he "was not able to specifically confirm" whether Vergara was behind the Chivas Guadalajara Licensing LLC entity that filed two trademark applications filed last month. But Garber confirmed that the league "did not file the registration." Garber: "My guess is they were thinking about whether they were going to rebrand" (PHILLY.com, 2/20).

END OF AN ERROR? ESPN FC's Jeff Carlisle wrote the "single biggest embarrassment" to MLS "has been removed at last." The move "amounts to a colossal cutting of losses by MLS," but that "didn’t stop Garber from issuing a spirited defense of Vergara and Fuentes." Garber said, "They’re smart, they’re creative. Jorge in particular was a huge believer in soccer in America and still is. He was one of our strongest advocates down in Mexico, and helped in our relationship with the Mexican federation. Every time he had a chance to talk about the league down there, it was positive." Carlisle wrote Vergara was "guilty" of the "misguided attempts to stock the club with castoffs from Liga MX." The performance "has been just as poor off the field, with attendance in 2013 sinking to 8,366 fans per game, the first time since 2005 that an MLS team’s official attendance had fallen below the 10,000 mark." If those had "been the only mistakes Vergara made, MLS likely wouldn’t have seen the need to buy out Vergara and Fuentes." But Vergara "seemed hell-bent on embarrassing the league again and again" (ESPNFC.com, 2/20). ESPN's Alexi Lalas said, "For the moment, I think it will probably hurt. But we will look back years from now at this as a masterstroke for Don Garber and the league to buy this team back because they're getting a team in a market with incredible potential in Los Angeles. ... On the surface it could be looked at as a negative, but really I think in the long-term it's a positive. We always talk about this league as you're only as strong as your weakest link and for a long time Chivas USA has been that weak link" ("ESPN FC," ESPN2, 2/20).

EXPANSION PLANS: Garber on Thursday said that Atlanta, Minneapolis, Sacramento, San Diego and unnamed cities in Texas are "under consideration as expansion cities." Garber: "We continue to work and make progress in Atlanta and we are bullish on that market. We'll continue to work hopefully with the Falcons and Arthur Blank. ... We have been working hard with a potential ownership group in Minneapolis and that opportunity is one that we're excited about as we believe we need more teams in the Midwest" (AP, 2/20). In Sacramento, Lillis & Kasler note expansion USL Pro club Sacramento Republic FC "will debut next month." Team officials have said that they "are setting a goal of getting promoted to MLS" (SACRAMENTO BEE, 2/21).
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