Bidders Begin Expressing Interest in Buying Dodgers

As the smoke began to clear Tuesday from Peter O’Malley’s bombshell announcement that his family is selling the Los Angeles Dodgers, the first potential bidders began to emerge for what is baseball’s--and arguably all of the sports world’s--premiere franchise.

Among those expressing concrete interest were former baseball Commissioner Peter Ueberroth, celebrity lawyer Robert Shapiro, and Robert Daly, co-chairman of the music and film divisions of Time Warner. Each said he would consider mounting a bid as part of a syndicate of wealthy investors.

Speculation in the sports and telecommunications industries, however, focused more on several entertainment companies that could incorporate ownership of the Dodgers in their broadcasting, cable, or film production operations.

Heading that list is Los Angeles-based Fox Television, a unit of Rupert Murdoch’s News Corp. Fox TV will broadcast Dodger games this season as part of baseball’s national television contract, and the Fox Sports West cable network will also show games locally.

Moreover, observers say, Murdoch is an exceptionally aggressive bidder for properties he wants. He would be well-positioned to profit from Dodger telecasts on his other communications holdings, which include satellite broadcasting systems around the world.

“If [buying the Dodgers] became part of the sports plan of Fox,” Ueberroth acknowledged, “Rupert Murdoch would more than likely be the successful bidder, in my view.”

Fox executives were unavailable for comment Tuesday.

Other entertainment companies mentioned as possible bidders are Sony, MCA, Viacom and ITT. Industry and corporate sources, however, downplayed the likelihood that any of those four might emerge as serious bidders.

Sony has not yet fully resolved its strategic and management problems at such entertainment units as Columbia Pictures. MCA’s new chief, Edgar Bronfman Jr., is understood to oppose any investment in professional sports. Viacom is saddled with high levels of debt that might constrain its ability to make a Dodgers bid; indeed, the company recently sold its interest in the NBA’s New York Knicks and NHL’s New York Rangers to ITT. And that company is said by internal sources to be uninterested in making a Dodgers bid.

The interest from individual investors and speculation about corporate buyers mixed with more fanciful ideas--including a proposal from politicians in Brooklyn, which has cherished a 40-year grudge over Walter O’Malley’s transfer of the Dodgers to Los Angeles, to buy it back--as the sports world tried to digest the O’Malleys’ surprise announcement.

Most industry observers reached Tuesday argued that the Dodgers’ high value as a prestige franchise, as well as the team’s extensive real estate holdings in Los Angeles, Vero Beach, Fla., and the Dominican Republic, could drive the sale price to the range of $300 million, a record for a major league baseball team.

That price would put a purchase well out of the range of any but the most well-heeled private investors or corporations that might exploit the team in ways that extend beyond the confines of Dodger Stadium.

Individuals or syndicates of private investors without related interests would be hard-pressed to rationalize paying a high price, according to several experts.

“Our analysis would tell us this franchise will be sold for a record price,” said Ueberroth, who said he would consider making a bid even though the team “has a marquee value that would probably eliminate us because we are economic buyers.”

Daly, 60, agreed that private investors face a high economic hurdle. “As individuals, the only way to do it is if you really have the passion. In cold dollars and sense terms, you probably can’t get the return.”

Since the news came out that the Dodgers are for sale, Daly said he has received several calls from wealthy friends who have offered to join him in an investment group if he decides to go ahead.

Some observers say the high-end estimates of the Dodgers’ value depend on questionable assumptions about the value of the 300-acre Chavez Ravine parcel on which Dodger Stadium sits.

The parcel, close to downtown Los Angeles, would have huge value if it could be developed commercially, but some local real estate experts doubt that the land can be fully exploited.

“When they talked about putting an NFL stadium there, the local neighborhood was up in arms, saying there was too much congestion already,” said Richard Plummer of Cushman & Wakefield in Los Angeles. Even assuming that the city would allow the site to be developed for something other than a ballpark, the cost of traffic mitigation measures such as widening roads would eat up most of the profits, Plummer said.

Nevertheless, the allure of the Dodgers name is hard to underestimate. “It’s the most valuable baseball franchise there is,” said attorney Shapiro. “It’s a very, very interesting opportunity, perhaps the last of the great opportunities.” Shapiro said he was discussing forming an investment group with several “individuals who can afford it, believe me.”

Even one Disney executive acknowledged that his company might have been a bidder had it not last year bought a controlling interest in the Anaheim Angels.

“The dynamics of Anaheim work so well for us,” said Tony Tavares, president of Anaheim Sports, Disney’s sports franchise arm, referring to the clustering of the Angels’ Anaheim Stadium, Disneyland and the Pond arena, home of the Mighty Ducks of the National Hockey League. “But you look at the Dodgers, who have been so successful and have a tradition of excellence. It’s interesting.”

O’Malley said Tuesday that his phone was ringing off the hook all day, but that he has yet to respond to any inquiries or proposals. “We haven’t talked to anybody or listened to anybody yet.”