Dodgers for sale _ but who can write the $200 million check?
NEW YORK (AP) _ From Ebbets Field in Brooklyn to the palm trees of Los Angeles, in dusty memories and on dustier ball fields, the Dodgers have come to represent a piece of Americana.
In the world of big business, the story is quite different. Sports teams aren’t valued by points scored and championships won, rather by cash flow, licensing fees and debt. In this world, the Dodgers are seen as an asset and as programming.
``The cost of doing business in that game has accelerated very substantially,″ said Dennis McAlpine, a media and entertainment analyst at Josephthal, Lyon & Ross Inc., a brokerage firm. ``There aren’t that many people able to put that much money into a plaything.″
At an estimated $200 million or more, the Dodgers’ next owner probably will be either a major corporation _ perhaps a media company with a use for sports programming _ or an investment group whose net worth reads like a nine-inning line score.
McAlpine touches on the big unknown that makes handicapping potential bidders impossible. Ego may drive the decision to a frightening extent. The winner becomes a celebrity overnight.
The Walt Disney Co., based just up the freeway in Burbank, Calif., owns the Anaheim Mighty Ducks of the NHL, with chairman Michael Eisner one of its biggest fans. Disney also owns 25 percent of the Angels baseball franchise and operates the team, with an option to buy the remaining stock following the
``I would think if I was going to sell that team, the first place I’d go is to call Mr. Eisner,″ McAlpine said, allowing that Disney would have to sell the Angels stake to buy the Dodgers.
Many other big media and entertainment companies also have ownership interests in sports teams. Some of the pairings: ITT Corp. and the Knicks and Rangers of New York; Time Warner Inc. and the Braves and Hawks of Atlanta; Tribune Co. and the Chicago Cubs; Comcast Corp. and the Flyers and 76ers of Philadelphia.
Those companies all own either broadcast or cable outlets capable of airing the sports programming the teams provide.
Peter O’Malley, the Dodgers’ president, said it’s become more difficult for families to continue to own major league baseball teams. Costs, from player salaries to facilities, have become a major issue.
For big companies that can spin sports into gold, like broadcasters and cable operators, the economics are different. One other way to change the formula would be to tap public funds _ the stock market.
That concept has become popular recently, with H. Wayne Huizenga, known best as the former chief of Blockbuster Entertainment, taking the Florida Panthers hockey team public. The company, Florida Panthers Holdings Inc., trades on the Nasdaq Stock Market. It’s ticker symbol: PUCK.
Ascent Entertainment Group Inc., ticker GOAL, owns basketball’s Denver Nuggets and hockey’s Colorado Avalanche. The Boston Celtics basketball team has been public for some time as Boston Celtics L.P.
Baseball owners would have to approve a policy change to allow public ownership, not likely in a sport where small-market owners fear the huge cash of large-market team.
``It could be possible for a group to come together, purchase to Dodgers and take it forward as a public entity,″ said Christopher Dixon, a media analyst at PaineWebber Inc. He noted it’s even possible O’Malley could decide to sell stock to the public himself.
Of course, it’s all speculation at this point. O’Malley has said a sale could take some time and no potential bidders have been identified. The owners have not even named a price, expected to easily surpass the baseball record of $173 million paid by Peter Angelos’ group for the Baltimore Orioles in 1993.
There are the wild cards, too. The nation’s richest individuals could easily afford the $200 million-plus price tag. For example, Paul Allen, who founded Microsoft with Bill Gates and is estimated by Forbes magazine to be worth $7.5 billion, owns the Portland Trail Blazers.