The Los Angeles Dodgers brand has seen better days. Last April, a controversy exploded over the team’s ownership. Not since the legendary baseball team picked up and left its beloved Brooklyn fans in the dust had the Dodgers been so battered by bad press.
It seems then-owner Frank McCourt had run afoul of Major League Baseball (MLB), who was questioning McCourt’s management of the team and its finances. In fact, McCourt had a very public dispute with his wife Jamie, whom he fired in 2009 as CEO of the Dodgers. A week later, Jamie filed for divorce. A California court told the McCourts they would have to work out their Dodger dealings outside of divorce court. The whole mess went into extra innings when it was later learned that the IRS was investigating the odd couple for money they took from the team without paying taxes.
Through it all, Frank McCourt remained a Dodger stalwart. On April 27, 2011, he proclaimed, “I took my life savings and invested it into the Los Angeles Dodgers. No one handed me the Dodgers and no one is going to take it away. I’m not going anywhere.” A nice sentiment, perhaps, but it didn’t stop the team from entering bankruptcy in June. The MLB promptly put a monitor in place to keep a watchful eye on the Dodgers, which McCourt claimed was tantamount to a “hostile takeover.”
Well, Frank, as the umpire famously screams, “Yer OUT!” On April 27, 2012, exactly a year after his infamous “I’m not going anywhere” speech, McCourt agreed to sell the Los Angeles Dodgers for $2.15 billion to another ball player, none other than LA Lakers basketball superstar Magic Johnson, heading his own team of buyers. In addition to Magic Johnson, the Dodgers’ new owners will include financial services firm Guggenheim Partners, Peter Guber, head of film company Mandalay Entertainment, and Stan Kasten, former president of the Atlanta Braves and Washington Nationals. A judge needs to approve the deal, but if it goes through, the Dodgers will be sold for more money than any other professional sports team.[more]
Under the agreement, McCourt will be allowed to repay a $150 million loan made to the team by MLB, plus his $130 divorce settlement. McCourt also gets to participate in a joint venture with the investment group so he can keep a piece of the land surrounding Dodger Stadium.
A victim of the dispute between McCourt and MLB was Fox Sports, which had made a billion dollar television deal with McCourt that was blocked by MLB. Magic Johnson’s group is now in a position to extend a deal with Prime Ticket, which is owned by Fox Sports, or consider other cable television opportunities. One possibility, according to the New York Times, would be a major agreement with Time Warner Cable, which created regional networks for the Lakers.
Frank McCourt’s public statement this year was in marked contrast to that of a year ago: “This agreement with Guggenheim reflects both the strength and future potential of the Los Angeles Dodgers, and assures that the Dodgers will have new ownership with deep local roots, which bodes well for the Dodgers, its fans and the Los Angeles community.”
The purchase will put an end to a year of upheaval for the storied Dodgers just in time for the 2012 baseball season. Dodgers players and fans will undoubtedly be happy to hear the words “Play Ball!” once again.