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Tuesday, November 03, 2009
Waking Up From My Torpor: A New Juicy Blog, Dodger Divorce
Since this was the worst-case scenario World Series (two east coast teams? Bleh), I've been in hibernation more-or-less this postseason after both the Dodgers and Angels have been eliminated. But thanks to Jon for pointing out the latest in Dodger blogging, Dodger Divorce. Early on, blogger Joshua Fisher takes a peek at how the McCourts came to own the Dodgers and why this is going to be such a terrible mess to unwind. Excerpt:
So, if you're counting at home, the above adds up to $421 million in financing...for a $371 million purchase. That, friends, is a little scary. And there's more. In May 2005, McCourt announced a new, $250 million 25-year note which took out B of A and what remained of the debt to Fox (after the foreclosure on the Boston property). This increased the debt load to $521 million on a $371 million purchase. This financing, known as a private placement, was provided by an unidentified group of institutional investors, such as pension funds and insurance companies. The terms of the loan--5.66% fixed for 25 years--are relatively favorable to McCourt. The collateral for this new loan was reportedly the 300 acres of real estate surrounding Dodger Stadium--not the club itself. Importantly, one of the provisions of the private placement was that control of the Dodgers would not change hands.Fisher suggests that the McCourts' controlled assets are closer to $750M (not Jamie's claimed $1.2 billion), and might have a net worth of less than $600M.