It’s almost put-up or shut-up time for the high rollers and big talkers circling one of baseball’s most storied franchises.
Monday is the targeted deadline for first-round bids for the Los Angeles Dodgers: the century-old team, the stadium and the related assets that, appropriately enough, helped usher in the modern era of big-business televised sports.
“Given what I have learned about the court-sealed agreement between the Dodgers and Major League Baseball on the sale of the team, media rights and related assets, bids will definitely be over $1.4 billion and perhaps as high as $2 billion,” said Michael Ozanian, an executive editor at Forbes who writes about the business of sports.
At least 20 parties are expected to put in preliminary bids for the team, formerly the pride of Brooklyn, that fielded such greats as Jackie Robinson, the first African-American Major League Baseball player of the modern era.
The Dodgers landed on the auction block after owner Frank McCourt was forced to place the team under bankruptcy protection last year, kicking off a courtship that has lured a host of suitors from among sports, media and financial elite.
They include NBA legend Magic Johnson, billionaire hedge fund manager Steve Cohen, ex-Yankees and Dodgers manager Joe Torre, Internet entrepreneur and Dallas Mavericks-owner Mark Cuban, and former Dodger greats Orel Hershiser and Steve Garvey.
News Corp’s Fox group, the current broadcast partner of the Dodgers, has also received a nondisclosure agreement from bankers involved in the sale and has been talking with bidders about potentially scooping up a minority stake to help secure TV rights beyond 2013.
Ticket revenue and turnstile attendance declined 19 percent and 21 percent last year, a low point for a team that through the decades has had numerous ups and downs.
The club barely broke even last year, posting a profit of just $1.2 million before interest, tax, depreciation and amortization, according to regulatory filings.
But media rights beyond 2013 are at the center of the Dodgers’ sale, and are what is exciting would-be owners. Fox is the current broadcast partner but its deal expires after 2013.
Observers say the list of possible bidders lengthens by the day in what at least one person involved in the initial negotiations termed a “ridiculous” and extraordinarily disorganized process.
Sources familiar with the process expect that various groups will forge ties as the process rolls on, and note the potential for confusion as alliances are made and remade.
“So many groups going around looking for money this close to the bid deadline, and they don’t have their ducks in a row — give me a break,” one source involved in the bidding said on condition of anonymity because the bidding process was not public.
“Most of the leverage is with Fox. In my mind, they are the 800-pound gorilla in the corner everyone is ignoring,” said the source, who does not represent Fox.
The sale is being conducted by the Blackstone Group and is being overseen by the U.S. Bankruptcy Court in Wilmington, Delaware. McCourt bought the team in 2004 for $430 million, primarily financed with debt.
After the initial bidding, Blackstone is expected to narrow the field and send up to 10 potential bidding groups to Major League Baseball for approval before they can ultimately participate in an auction.
McCourt and Blackstone are then expected to make the final determination in the ultimate sale.
Major League Baseball Commissioner Bud Selig said on January 14 he was counting on the bankrupt team to be sold by April 30. Under the terms of a settlement between the league and McCourt, the Los Angeles businessman must sell the Dodgers and the stadium within that time frame.
Fox owned the Dodgers from 1998 to 2004. A spokesman said the company has no desire to own the team.
“If they want to buy it, they can buy it,” said the source involved in the bidding. “If I’m Fox, I’m lying in the weeds, checking the bidding and if I don’t like the bids maybe I buy it.”