Billionaires Eli Broad, Mark Cuban and Larry Ellison are among those whom sports bankers expect to bid on the Los Angeles Dodgers after owner Frank McCourt agreed to a court-supervised sale following a bankruptcy filing and months of legal wrangling with Major League Baseball.
Ron Burkle, chairman of Los Angeles-based Yucaipa Cos. private investment firm, said in an e-mailed statement that he “would be proud to be part of its future.”
The sale, which will be managed by Blackstone Group LP (BX), may also include a bid from Fox Sports, a person familiar with the company’s thinking said. Fox Sports’ parent, Rupert Murdoch’s News Corp., sold the franchise that broke baseball’s color barrier in 1947 to McCourt for $421 million in 2004.
Fox will compare the price of renewing its current broadcast agreement with the cost of buying the team, said the person, who declined to be named because the deliberations aren’t public. News Corp. spokesman Jack Horner declined to comment.
The Dodgers filed for bankruptcy protection four months ago after baseball Commissioner Bud Selig rejected a 17-year broadcast contract with Fox Sports, a deal valued by McCourt at $3 billion.
While the notoriety generated by the sale of what former Madison Square Garden President Bob Gutkowski called “beachfront property” will draw wide interest, only a few will be considered serious bidders, said Sal Galatioto, whose New York-based sports advisory firm represented Walt Disney Co. (DIS) in its sale of the Los Angeles Angels and TD Ameritrade Holding Corp. (AMTD) founder Tom Ricketts in his baseball-record $845 million purchase of the Chicago Cubs in 2009 from Tribune Co., which is controlled by real-estate magnate Sam Zell.
“This is going to be a heavy lift, a big equity check,” Galatioto, founder of Galatioto Sports Partners, said in a telephone interview. “The easiest way to get your name up in lights, especially in L.A., is to bid on the Dodgers. You don’t have to actually bid, just say you’re going to.”
A number of sports bankers and lawyers declined to discuss the Dodgers, citing their possible involvement in the sale.
Attorneys for McCourt estimated the value of the team, its stadium and the surrounding land to be more than $1 billion. Forbes magazine says the team and its assets are worth $800 million. Beyond the team and its media rights, the club hasn’t said which assets will be included in the sale.
“The Dodgers are different,” said Bob Lanza, co-chairman of the sports and entertainment practice at the Hiscock & Barclay law firm in New York. “Owning a piece of the Dodgers is like having a piece of Manchester United or the Yankees. It’s real tradition that has significant value.”
Cuban, owner of the National Basketball Association- champion Dallas Mavericks, has made no secret of his desire to own a baseball team. He expressed interest in the Cubs and was a bidder on the Texas Rangers, who ultimately went to a group that included Hall of Fame pitcher Nolan Ryan.
Cuban said in an e-mail that he hasn’t made an offer for the Dodgers, who finished with an 82-79 record this season while often playing in a half-empty stadium.
Cuban said he previously inquired about buying the Dodgers and was told the team expected a minimum of $1 billion.
“I said I wasn’t interested at that price,” Cuban wrote.
Karen Denne, a spokesman for KB Home co-founder Broad, declined immediate comment. Deborah Hellinger, a spokeswoman for Ellison, the chief executive officer of Oracle Corp., didn’t immediately return an e-mail seeking comment.
Ellison made a bid last year for basketball’s Golden State Warriors, who were sold to a group led by Joe Lacob, a partner at the venture-capital firm Kleiner Perkins Caufield & Byers, for an NBA-record $450 million.
Burkle, a co-owner of the National Hockey League’s Pittsburgh Penguins whose investment firm has interests in supermarkets and trucking, said in his statement, “It’s one of the best brands in all of sports, and like many people I’d be very proud to be a part of it’s future.” He didn’t elaborate.
Former Dodgers players Steve Garvey and Orel Hershiser have expressed interest in forming an investment group to bid on their old team.
The Los Angeles Times said in September that McCourt received an unsolicited $1.2 billion cash offer from a group indirectly financed by the government of China. The bid, the newspaper said, was headed by Los Angeles Marathon founder Bill Burke. McCourt said at the time he had no interest in selling the team.
The new owner would be the third since Peter O’Malley sold the team to News Corp. (NWSA) in 1998. The team had been in the family since before Walter O’Malley relocated the club from Brooklyn in 1958.
Baseball charged McCourt in court documents with “looting” $189 million from the team for his personal use, including his divorce. McCourt denied the accusation.
The sale would end a tumultuous tenure for McCourt, whose club reached the postseason four times in his first six seasons.
The case is In re Los Angeles Dodgers LLC, 11-12010, U.S. Bankruptcy Court, District of Delaware (Wilmington).
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