Thursday, May 19, 2011

What a Screwed Up Mess We Have

You know things are bad when the Dodgers saving grace may be the cheating estranged wife of Frank McCourt. Jamie McCourt has asked the court to sell the team, via the LA Times.
In the filing, Jamie McCourt alleged that her ex-husband, Frank McCourt, had endangered the value of the Dodgers through his "mismanagement," and she requested that the judge overseeing the couple's divorce put the club up for sale so both parties could reap the maximum value from the primary asset of their marriage.
Forbes provides some more context.
Yesterday I wrote that the Dodgers were likely to be auctioned off by MLB because the team does not have the cash to meet payroll this month. In March we valued the Dodgers at $800 million with operating income (earnings before interest, taxes, depreciation and amortization) for the 2010 season of $32.8 million. But after interest payments on debt the Dodgers do not have enough cash to cover expenses.

Jamie’s logic is that she and Frank could get a better price for the Dodgers than MLB. It is hard to disagree with her given the calamity over the sale process of the Texas Rangers. Like the Rangers and its previous owner, Tom Hicks, the Dodgers and Frank McCourt have debt problems with hordes of creditors chomping at the bit to get what is owed them. And Jamie knows that an auction open to as many bidders as possible will get a higher price than a sale controlled by MLB commissioner Bud Selig.
At this point, I care less who owns it as long as the process is open and it gets done sooner rather than later. With this recent move the above appears likely to be the case. Anything that kicks this piss-poor of an ownership group out the door right now would make this year a success.

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