In a quick and dramatic end to the year-long financial crisis of the Los Angeles Dodgers, the team’s owner, Frank McCourt, agreed to sell the team for $2.15 billion to a group headed by Magic Johnson, the Lakers’ Hall of Famer, reports The New York Times.
Johnson, who guided the Lakers to five NBA championships during the “Showtime” era of the 1980s, is a partner in the group together with longtime baseball executive Stan Kasten and movie executive Peter Guber.
Mark Walter, chief executive officer of Guggenheim Partners, a Chicago-based financial services company, would be the controlling owner, according to Los Angeles Times.
“I am thrilled to be part of the historic Dodger franchise,” Johnson said in the statement. He added that the new owners “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.”
The New York Times informs that the winning bid defeated one by Stan Kroenke, the billionaire owner of the St. Louis Rams, Colorado Avalanche and Denver Nuggets, and a second from two other billionaires: Steven A. Cohen, the hedge-fund manager who recently bought a small share of the Mets, and Patrick Soon-Shiong, who made his money in pharmaceuticals.
The acquiring group, called Guggenheim Baseball Management, includes Mandalay Entertainment chief executive Peter Guber, tells The Huffington Post.
“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.
The winning group paid $2 billion for the team — a record for a sports franchise — according to an announcement issued jointly with previous owner Frank McCourt.
The most ever paid for a franchise is at least $1.4 billion for Manchester United. The Miami Dolphins were sold for $1.15 billion and the Chicago Cubs were acquired for $845 million.
In 2004 McCourt paid $430 million to buy the team, Dodger Stadium and 250 acres of land that include the parking lots, from the Fox division of Rupert Murdoch’s News Corp., a sale that left the team with about $50 million in cash at the time.
The team’s debt made up $579 million in January, according to a court filing, so even after the divorce payment, taxes and legal and banking fees, he stands to make several hundred million dollars.
The last time when the Dodgers won the World Series was back in 1988, their sixth championship in half a century of O’Malley family ownership. The Johnson group would become the Dodgers’ third owner since the O’Malleys sold the team in 1998, following News Corp. and McCourt.
If the deal, which must be confirmed by the court in a hearing April 13, closes as expected, the Dodgers would be owned by an entity called Guggenheim Baseball Partners. Kasten, former president of the Atlanta Braves and Washington Nationals, would run the team.
“Stan Kasten is my man,” Johnson said announcing his bid last December. “He’s a winner. He’s built two incredible organizations, and he’s well-respected. That is what was important to me. I had to get with a winner, a guy who understands baseball inside and out.”