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|Agreement Reached to Sell Dodgers to Magic Johnson Group for $2 Billion|
|Written by San Fernando Valley Sun|
|Thursday, 29 March 2012 02:43|
LOS ANGELES (CNS) – The Los Angeles Dodgers have announced they have reached an agreement to be acquired by a group led by Los Angeles Lakers legend Magic Johnson for $2 billion, the highest price for a professional sports team.
Outgoing owner Frank McCourt and certain affiliates of the purchasers will also be forming a joint venture that will acquire the land surrounding Dodger Stadium for an additional $150 million.
"This transaction underscores the debtors' objective to maximize the value of their estate and to emerge from Chapter 11 under a successful plan of reorganization, under which all creditors are paid in full," according to a statement from the Dodgers.
In an auction under the auspices of the U.S. Bankruptcy Court, McCourt chose the group officially known as Guggenheim Baseball Management LLC over St. Louis Rams owner Stan Kroenke and a partnership of hedge fund billionaire Steve Cohen and biotech billionaire Patrick Soon-Shiong.
"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 Johnson, who helped lead the Lakers to five NBA championships during his Hall of Fame career.
Mayor Antonio Villaraigosa said he was "excited to hear" that Johnson's group was selected as the winning bidder.
"Magic's ownership ensures the team will have the guidance of a committed Angeleno," Villaraigosa said.
The sale must be confirmed by the court April 13, the Los Angeles Times reported. It is set to close by April 30, the same day McCourt must pay his ex-wife Jamie $131 million in a divorce settlement, according to The Times.
The bulk of the funding to buy the Dodgers came from Guggenheim Partners, a global financial services firm, The Times reported.
Mark R. Walter, the chief executive officer of Guggenheim Partners, will be the controlling partner of Guggenheim Baseball Management LLC. However, he is not expected to play a significant role in the day-to-day operation of the team, The Times reported.
In addition to Johnson, the group also includes former Atlanta Braves and Washington Nationals President Stan Kasten, Peter Guber, chairman and chief executive officer of the Mandalay Entertainment Group, which produces movies and owns a portion of the NBA's Golden State Warriors, Bobby Patton and Todd Boehly.
The Dodgers would be run by Kasten, according to The Times.
McCourt and Major League Baseball reached an agreement Nov. 1 to a "court supervised process" to sell the team, which filed for Chapter 11 bankruptcy in June.
"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," McCourt said.
"We are delighted that this group will continue the important work we have started in the community, fulfilling our commitment to building 50 Dream Fields and helping with the effort to cure cancer."
The previous high price for a team sale was $1.47 billion for the English soccer team Manchester United. The most for a North American team was $1.1 billion for the NFL's Miami Dolphins, according to Forbes.
"Out of this deal, it's likely McCourt before taxes will make somewhere in the range of $900 million, after taxes, in the range of half a billion (dollars)," Marc Ganis, president of the Chicago-based sports consulting firm Sportscorp Ltd., told Fox11.
"What Kasten, Magic and the Guggenheim group did was they gave McCourt everything he wanted. He wanted to stay in on the land, he's staying in on the land. He wanted $2 billion, he got $2 billion. It's the old line from 'The Godfather,' they made him an offer he couldn't refuse."
McCourt was a Boston real estate developer when he purchased the Dodgers in 2004 from News Corp., whose holdings include 20th Century Fox, Fox Broadcasting and the Fox News Channel.
The Dodgers reached the National League playoffs in four of McCourt's first six seasons as owner, but has struggled since he and his wife Jamie confirmed on the eve of the 2009 National League Championship Series they had they separated after being married since 1979.
The Dodgers lost that best-of-seven series to the Philadelphia Phillies in five games and posted 80-82 and 82-79 records each of the past two seasons, never finishing higher than third in the five-team National League West.
Their 23 consecutive seasons without a pennant is the longest streak in the history of the team, which began play in the National League in 1890 as the Brooklyn Bridegrooms.
|Last Updated on Thursday, 29 March 2012 05:00|