Thursday, February 23, 2012

Erosion of Dodger Sale Is Fault of McCourt and Selig

       By Ross Newhan

       The deadline for second bids in the bankruptcy sale of the Dodgers was Thursday, and an already convoluted process has now collapsed into a total mess.

       It is easy to blame Frank McCourt, and there is no questioning his destructive ownership, but Commissioner Bud Selig and advisors also share responsibility for a situation that is now almost beyond repair.

       Selig's desire to rid the Dodgers of McCourt's ownership--and who doesn't applaud him for that-- has virtually (or is it literally) allowed McCourt to dictate the final terms of the sale.

       In addition, it was Major League Baseball that allowed McCourt to divide the Dodgers and the Dodger Stadium parking lots into separate entities in 2005, and the sale agreement between McCourt and MLB permits him to retain the lots--and build parking structures on them if he desires.

      The Dodgers are in bankruptcy as everyone knows, but the entity controlling the lots is not, and the new owner of the Dodgers would be forced to inherit a lease of the lots at $14 million per year.

      The lease calls for increases starting in 2015, an a new owner would also be responsible for a loan that requires the team to play at Dodger Stadium until 2030, according to McCourt's previous remarks.

      This situation, calling for a division of the team and the stadium from the parking lots, prompted most of the groups submitting a second bid to make it conditional depending if the lot was included or if it was not, according to multiple sources who refused to speak on the record because they do not have the authority or are restricted by the confidentiality agreement with Blackstone Advisory Partners (surpervising the sale for McCourt).

      However, learning that McCourt plans to retain the lot, the partnership of Rick Caruso and Joe Torre withdrew from the process in a letter to Rob Manfred, baseball's Executive Vice President. A copy of the letter was e-mailed to this writer and reads in part:

     "Since the outset we felt that operationally it would be impossible to effectively manage baseball operations having the parking lots...under separate ownership. We believed that during the bid process that we would have the opportunity to buy the lots. It has now been made clear to us by Mr. McCourt that the lots are not and will not be for sale."

    Caruso and Torre, probably one of the top five groups bidding for the Dodgers, wrote that if the circumstances change "we are prepared to re-engage in the process immediately."

    The withdrawal of Caruso/Torre, following the week's earlier withdrawal of former Dodger owner Peter O'Malley, leaves the number of groups still in the bidding unclear, although a group that includes Magic Johnson and former baseball executive Stan Kasten, and another headed by hedge fund billionaire Steve Cohen (and including former deputy commissioner Steve Greenberg and agent Arn Tellem) are still viable, having placed conditional bids, according to the sources.

    "Given the renovations that are necessary on the stadium and the $14 million off the top for the lease on the parking lot, McCourt is looking at a sale price that is likely to be a lot less that he may have originally envisioned," a source close to the process said.

    The source added that while the lots are not part of the bankruptcy, the federal judge overseeing the bankruptcy and the creditors that are involved could force McCourt to change his plan and sell the lots by charging that he "did not sell for top dollar" or as much as he would have if the lots had been included.

    "However," the source said, "we know that McCourt is a stubborn guy and plans to stay in Los Angeles rather than return to Boston, so unless he is legally forced to sell the lot, it appears at this point that he plans to keep it, which certainly changes the whole process."

    As it is, the remaining groups will now by investigated by major league baseball--a process that had begun already--and the principal financial figure in each group will be meeting with baseball's ownership and executive committees. The bidding groups will be narrowed to five--there may not be that many left if McCourt insists on retaining the lot--and then turned over to McCourt to select the winner by April 1.

   Nice of the commissioner to have given a despicable owner all of this control.


  An Angel Error

   It was the responsibility of Angel management to check with Albert Pujols regarding his feelings about having his image and "El Hombre" plastered on billboards throughout the megalopolis.

   First of all, Pujols may not have wanted to be isolated from his new teammates by being known as "the man."

   Secondly, Pujols always maintained that in St. Louis there was only one man, and that was Stan Musial. Now that he is with another team in another city it does not change his feelings, he has said, nor the responsibility of the Angels to discuss it with him.

   In addition, Angel owner Arte Moreno has always played down the Mexican aspect of his heritage to say he is a fourth generation American, period.

  The Angels should have kept that in mind when they billed Pujols as "El Hombre."



No comments:

Post a Comment