Guggenheim Baseball Partners which includes Magic Johnson will buy the Los Angeles Dodgers for $2 billion – twice the amount ever paid for a baseball franchise

Magic Johnson - Guggenheim Baseball Partners which includes Magic Johnson will buy the Los Angeles Dodgers for $2 billion - twice the amount ever paid for a baseball franchise

Magic Johnson - Guggenheim Baseball Partners which includes Magic Johnson will buy the Los Angeles Dodgers for $2 billion - twice the amount ever paid for a baseball franchise

As I posted a little while ago, the poor LA Dodgers have been driven into bankruptcy by the smarmy and incompetent Frank McCourt.

See:

https://pusz4frog.wordpress.com/2011/06/27/los-angeles-dodgers-file-for-bankruptcy-owner-frank-mccourt-has-obtained-150-million-in-interim-financing-in-order-to-save-the-club-from-a-take-over-by-major-league-baseball/

Today, it was revealed that a group called the Guggenheim Baseball Partners; that includes former basketball star Earvin “Magic” Johnson, will acquire the Los Angeles Dodgers for $2 billion.

The price tag is almost 2 times that amount ever paid for a baseball franchise, and the most ever paid for a North American sports franchise, according to MLB.com.

THE GBP AND THE MBL
The Guggenheim Baseball Partners will officially acquire the team, one of baseball’s most storied franchises, after the deal is approved by the judge overseeing the Dodgers’ bankruptcy.

The Guggenheim Baseball Partners is controlled by Mark Walter who is the CEO of Guggenheim Partners, a Chicago-based financial services company which formed GBP.

The Guggenheim Baseball Partners includes Magic Johnson, who guided the Lakers to five NBA championships during the 1980s, is a partner in the group along with movie executive Peter Guber and baseball executive Stan Kasten.

The Dodgers has won the World Series championship six times and, for decades, boasted an intensely loyal fan base.

UGLY
Under the ownership of real estate developer Frank McCourt, the Dodgers started it’s current downturn. The troubles really began when McCourt and his wife, Jamie, decided to get a vicious and expensive divorce, which was followed by a messy court battle.

Frank McCourt and ex-wife - Guggenheim Baseball Partners which includes Magic Johnson will buy the Los Angeles Dodgers for $2 billion - twice the amount ever paid for a baseball franchise

Frank McCourt and ex-wife - Guggenheim Baseball Partners which includes Magic Johnson will buy the Los Angeles Dodgers for $2 billion - twice the amount ever paid for a baseball franchise

The couple fought bitterly over ownership of the team and last April, Major League Baseball took charge of the beleaguered team. Two months later, the team filed for bankruptcy.

This October, McCourt and his wife had reached a settlement in which he is supposed to pay her $131 million, and the joke is that the attorneys’ fees alone could reach $35 million.

In an effort to hold on to the team, McCourt tried to score a $3 billion television deal with Fox, but the MLB decided they really didn’t want this loser to remain and owner, so the deal was rejected by Baseball Commissioner Bud Selig.

Good move by the MLB, since they knew that could earn some serious bank by selling the team, which it did in the auction that Guggenheim Baseball Partners won for $2 billion.

A NEW FACE
Guggenheim Baseball Partners propped up it’s face – Magic Johnson, who said the sale will start a new chapter for the Dodgers.

“I am thrilled to be part of the historic Dodger franchise and intend to build on the fantastic foundation laid by Frank McCourt as we drive the Dodgers back to the front page of the sports section in our wonderful community of Los Angeles,” said the former Los Angeles Lakers’ icon.

It is reported that some members of the group will also partner with McCourt to acquire Dodger Stadium and several other nearby properties for $150 million.

Legendary former Dodgers coach Tommy Lasorda applauded the sale, “I am happy for them. I just feel they are going to do everything they can to bring a championship to Los Angeles,” he told LA TV station KTLA.

The Dodgers finished in third place in the National League Western Division last season and did not make the playoffs.

Yes, $2 billion for a club has not won a World Series since 1988. Sounds like a deal.

Maybe hope is now on the horizon.

Hopefully after the sale, Guggenheim Baseball Partners will still have enough money to buy a famous Dodger Dog hot dog…

Dodger-Stadium - Guggenheim Baseball Partners which includes Magic Johnson will buy the Los Angeles Dodgers for $2 billion - twice the amount ever paid for a baseball franchise

Dodger-Stadium - Guggenheim Baseball Partners which includes Magic Johnson will buy the Los Angeles Dodgers for $2 billion - twice the amount ever paid for a baseball franchise

Los Angeles Dodgers file for bankruptcy – Owner Frank McCourt has obtained $150 million in interim financing in order to save the club from a take over by Major League Baseball

Los Angeles Dodgers file for bankruptcy - Owner Frank McCourt has obtained $150 million in interim financing in order to save the club from a take over by Major League Baseball
More drama for the biggest travisty in Major League Baseball history – The Frank McCourt mismanagement of the world famous Los Angeles Dodgers.

If you have not been following this… basically Frank McCourt made his money in the Boston real estate market specializing in the development of major commercial real estate projects, particularly parking lots.

I guess he loved parking lots so much, that he first tried to buy the Chicago Red Sox which has a large one, and then the Anaheim Angels and Tampa Bay Buccaneers; before finally succeeding in 2004 and bought the Los Angeles Dodgers for $430 million from NewsCorp, Rupert Murdoch’s flagship enterprise.

OPPS
McCourt’s purchase of the Dodgers was financed mostly by debt, with McCourt’s South Boston parking lot property was used as collateral for some of the financing to acquire the Dodgers from News Corp.

The Dodgers assets acquired by McCourt included significant real estate assets related to the stadium in Chavez Ravine, including stadium parking lot land. Plans have been announced for new real estate developments at Dodger Stadium. Hmm… Condos? Parking garages? A hospital for the elderly?

To offset the purchase, McCourt has raised ticket and concession prices every year. By 2010, the Dodger team and its related assets, in which McCourt had invested heavily in improvements, had increased in value to $727 million according to Forbes. Yeah, value gotten from the high ticket prices that the fans had to endure in order to go see a game.

What started it all, was that Frank McCourt decided to divorce his wife of 30 years – mega-businesswoman, Jamie “First Female CEO of a Baseball Team” McCourt. This bloody court fight exposed a lot of problems with the Dodgers finances, but it also threatened to saddle the team with the burden of a family feud in the owner box. In the end, they settled out of court.

Unfortunately it was contingent on Major League Baseball approving a 17-year television contract between the Dodgers and FOX Television. However, this month the MLB rejected the television deal and the settlement agreement fell apart.

Later last year it was revealed that the California Attorney General was opening an investigation into the team’s charitable foundation – the Dodgers’ Dream Foundation. It seem that according to tax returns, the charity’s chief executive Howard Sunkin, earned a salary of nearly $400,000 per year!! This is almost a quarter of the foundation’s entire budget. Sunkin is a close associate of McCourt and has worked with him during his divorce proceedings. The California courts awarded the funds to be repaid. McCourt personally repaid $100,000 – but, seriously!! What a scumbag!!!

HERE AND NOW
Today, Los Angeles Dodgers issued a statement that owner Frank McCourt has obtained $150 million in interim financing, and if the Delaware bankruptcy court approves the financing at a hearing on June 28, 2011.

It seems that McCourt could meet payroll and remain in charge of the team, but Major League Baseball is expected to challenge McCourt’s move. McCourt said the financing would stabilize the financial future of the team. The move also could extend the battle for ownership of the Dodgers well beyond this season, making it a long slow torture for us all.

“The action taken today by Mr. McCourt does nothing but inflict further harm to this historic franchise,” MLB Commissioner Bud Selig said in a statement.

Under the MLB constitution, the act of filing for bankruptcy enables the commissioner to strip McCourt of ownership. But bankruptcy court proceedings generally override MLB rules. If McCourt secures a favorable decision, he could keep the team and attempt to secure a lucrative, long-term television contract that would allow him to pay his bills.

Manny Ramirez is the Dodgers’ largest creditor, according to the bankruptcy filing. The Dodgers owe their former left fielder $21 million, followed by New York Yankees outfielder Andruw Jones ($11 million), Dodgers pitcher Hiroki Kuroda ($4.5 million) and shortstop Rafael Furcal ($3.7 million), and the Chicago White Sox ($3.5 million, for outfielder Juan Pierre).

The list of creditors also includes much of the current Dodgers roster, Hall of Fame broadcaster Vin Scully ($152,778), the city of Los Angeles ($240,563 in tax debt), and two players yet to play for the Dodgers (prospects Zach Lee at $3.4 million and Alexander Santana at $499,500).

In their bankruptcy filing, the Dodgers said they owed almost $40 million this week alone, including $20 million in current and deferred salaries and $18.7 million to fund future deferred payments, in accordance with baseball’s collective bargaining agreement.

In his statement, Selig said the Dodgers’ financial woes were “caused by Mr. McCourt’s excessive debt and his diversion of club assets for his own personal needs. We have consistently communicated to Mr. McCourt that any potential solution to his problems that contemplates mortgaging the future of the Dodgers franchise to the long-term detriment of the club, its loyal fans and the game of baseball would not be acceptable.”
So, what will happen with the Los Angeles Dodgers? I don’t know which will be better, McCourt keeping the team, or the MLB Corporate machine getting control of the team.

All the fans want is a good schedule, great play and wins. Something McCourt hasn’t done, even though he raised ticket prices.