New Yorker Looks At Anschutz-Leiweke's Relationship, Future Plans
AEG Chair PHIL ANSCHUTZ and President & CEO TIM LEIWEKE "have transformed the sports and entertainment industry," according to an extensive look of Anschutz's business empire in L.A. and the relationship between the two men by Connie Bruck of the NEW YORKER. NBA Commissioner DAVID STERN said, "Their footprint and their areas of expertise don't seem to have boundaries. Tim really didn't become the Tim he is today until he went to work for Phil Anschutz." Stern said Leiweke is "a sort of modern-day P.T. BARNUM." Bruck did not speak to Anschutz while examining his various business endeavors. Leiweke said that Anschutz "constantly argues with him and tests his premises." He said, "Phil would probably say that we disagree more than we agree."
A FOCUS ON CHINA AND L.A.: AEG in '08 "committed to building twelve arenas in China," and the company that year "helped develop an arena in Beijing, and in 2009 built one in Shanghai." But AEG recently "withdrew as an equity investor from the Beijing arena; Leiweke said that the company had trouble getting its profits out of China, so it is not making any new equity investments there." The company "operates as a consultant instead." Leiweke said, "I took a beating from our board on China. That was not a favored project of anyone on our board except for me, and so we persevered, but have we learned lessons? Yeah!" Bruck examined the relationship between Anschutz and Majestic Realty Chair & CEO ED ROSKI, who were previously development partners. Roski has his own plan for an NFL stadium at the City of Industry. When AEG announced it's own proposal for an NFL stadium in downtown L.A. in '10, a source said Roski "felt that Tim misled him and became a competitor." While Roski and Anschutz "had started out as roughly equal partners in the [NHL] Kings, the Lakers, Staples Center, and the surrounding thirty acres that would become L.A. Live, Roski's stake has dwindled to less than eight per cent." Leiweke said, "Ed Roski was involved at the beginning of this, but the fact is, Phil had the resources and the vision."
WHAT LIES AHEAD: Bruck writes in the NFL's view, the L.A. stadium deal that Anschutz was proposing "was doubly flawed: not only was he trying to get a share of a team at a discount but he wanted a landlord-tenant relationship that, in its control of revenues, amounted to a kind of asset-stripping." NFL Exec VP/Business Ventures ERIC GRUBMAN said, "It's unlikely the league or a team would approve this proposal." Grubman said that six weeks earlier he had "given Leiweke an outline of elements that he thought would persuade a team to sign with Anschutz." Grubman: "Since they haven't quit, I have some optimism they're working toward it." He added that Roski also "has not gone far enough to interest a team." Grubman: "Roski's site is attractive on several fronts, but, to get something across the goal line at that site, the deal for a club owner would have to be very good and very low-risk."
FUTURE OF LEIWEKE? Leiweke's contract with Anschutz "will end this year," and a source said that Leiweke has a stake "of about four per cent of AEG, including the arenas and sports teams." In the past, Leiweke has "mused publicly about running for office." At a recent neighborhood council meeting he said, "The reality is, I wish I could run for mayor, but I can't afford to." His brother, Lightning CEO & Minority Owner Tod Leiweke, said that people should not "rule out the possibility" that Tim will enter politics (NEW YORKER, 1/16 issue).