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Dodger Deal Is Practically Done

Ownership committee and executive council endorse McCourt's leveraged bid, seemingly making the vote by owners Thursday a formality.

January 28, 2004|Ross Newhan | Times Staff Writer

Only the formality of a vote by major league owners Thursday stands between Boston real estate developer Frank McCourt and control of the Dodgers.

McCourt needs 22 of the 30 owners to approve his $430-million purchase, but that vote, to be conducted by conference call, became largely academic Tuesday when both the ownership committee and executive council endorsed his bid during separate conference calls with Commissioner Bud Selig and other baseball officials.

Because at least half of the clubs are represented on the ownership committee and executive council, those endorsements are considered tantamount to approval by the full ownership.

"It would be very unusual for the clubs to not follow the recommendation of the committee," said Bob DuPuy, baseball's chief operating officer. "Everything is on track for the vote Thursday."

In fact, sources said, there are tentative plans for McCourt and his wife, Jamie, to meet with the Dodger staff after the conference call, and then hold a news conference at Dodger Stadium.

It is unclear how many immediate changes McCourt has in mind beyond the appointment of Corey Busch, his transition point man, to a high-ranking position with the club. But it is apparent that the 11th-hour offer of billionaire Los Angeles developer Eli Broad to buy the club for the same $430 million, mostly in cash, has not impeded McCourt's highly leveraged bid.

Amid concern that has developed in Los Angeles over McCourt's long-term intentions for the Dodgers and his ability to operate the club at a competitive level, sources said Mayor James K. Hahn, following up the emergence of Broad as a potential local owner, phoned Selig and DuPuy recently to gain a better insight into baseball's process.

DuPuy was reluctant to discuss their conversation but described it as positive and upbeat.

"There was no attempt by the mayor to undermine McCourt's ownership," DuPuy said. "He was interested in the process and McCourt's long-term plans and he wondered why McCourt had not been out there selling himself, and I told him that was our decision, that until a sale is finalized we ask the prospective owner to refrain from media and public comments. I told the mayor that he could blame us if he wanted, but the conversation was totally pleasant."

McCourt, of course, made several trips to Los Angeles early in the sales process in a futile attempt to find local investors. He is funding the purchase almost entirely with loans, including what had been a $205-million loan from News Corp., the Dodger owner, until that was reworked last week in New York to bring McCourt's proposal more in line with the industry's debt-service rule.

News Corp. will now stay on temporarily as a minority owner, with about 20% of the $205 million converted to equity. However, in the restructured proposal, McCourt is required to find an investor willing to buy out News Corp.'s equity stake in one to two years. A source familiar with the transaction corrected the initial report and said that the investor does not have to be from Southern California.

"McCourt hopes to find a local investor, but he's not required to do that," the source said. "News Corp. just wants out. The investor can be from Kalamazoo."

With McCourt's approval now inevitable and Broad's late offer not leaving the desk of News Corp. Chairman Peter Chernin, Los Angeles Councilman Jack Weiss said Tuesday he would withdraw a resolution urging the Dodgers and baseball to consider local ownership. The Council had been expected to vote on the resolution today.

Weiss said he believed the preference for a local buyer had been strongly conveyed and the time had come for the city to unite behind McCourt.

"If there is to be a new owner and that new owner moves to Los Angeles, he becomes a de facto local owner," Weiss said. "I very much look forward to working with [McCourt], so he can make the Dodgers as successful as I want them to be. I'd like to get back into the habit of going to Dodger Stadium in October."

Weiss encouraged fans who had planned to attend today's meeting and rally for passage of the resolution to make sure McCourt never loses sight of their passion.

"At minimum," he said, "the new owner is on notice that L.A. takes its Dodgers very seriously."

Staff writer Bill Shaikin contributed to this report.

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Timeline of the Deal

Oct. 7, 2003: Boston real estate developer Frank McCourt is identified as the leading candidate to buy the Dodgers.

Oct. 10: News Corp. announces it has agreed in principle to sell the Dodgers to McCourt for $430 million.

Nov. 10: A Nov. 20 vote to approve the sale is delayed because McCourt has not completed financial paperwork the commissioner's office must review.

Dec. 12: McCourt submits the required paperwork.

Dec. 22: McCourt addresses proposed financing with major league officials.

Dec. 31: Commissioner Bud Selig puts the issue of McCourt's bid on the agenda for a Jan. 14-15 owners' meeting.

Jan. 9, 2004: With financing concerns lingering, Selig calls off Jan. 14-15 vote but expects sale to be approved in a conference call before Jan. 31.

Jan. 16, 2004: Los Angeles developer and philanthropist Eli Broad offers to buy the Dodgers if McCourt's bid falls through.

Jan. 21, 2004: News Corp. agrees to retain a minority ownership position, strengthening McCourt's bid by reducing amount he is borrowing to finance deal.

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