Disney Ducks Out of Baseball

The Walt Disney Co.’s proposal to buy controlling interest in the Angels collapsed Wednesday when the entertainment giant walked away from negotiations with the city over the renovation of Anaheim Stadium.

“This deal is over,” said Disney Sports Enterprises President Tony Tavares. “The negotiations have ended.”

The breakdown came after weeks of around-the-clock negotiations. Both sides confirmed Wednesday in separate news conferences that they had reached an impasse.

Disney’s surprise announcement, made as the final details of the proposal were being ironed out, stunned city leaders and forces team owners Gene and Jackie Autry to find a new buyer for the team as they ponder whether to keep the Angels in Anaheim past the team’s current lease, which expires in 2001.

Acting baseball Commissioner Bud Selig suggested Wednesday that the Disney deal might not be dead.

“I’ve talked to the Disney people and I’ve talked to Jackie Autry and I think there’s still time to work this out,” he said.

“I felt [Disney and Anaheim] were close to a deal but I also knew there were problems. Some things clearly went backwards in the last 24 hours, but I’m hopeful they can be resolved.”

But Tavares, during a news conference at the Pond of Anaheim, said Disney was not comfortable asking baseball officials for a deadline extension.

“We simply ran out of time in our efforts to close the gap,” Tavares said. “We didn’t want to become involved unless we could have a stadium that everyone could be proud of.”

City Manager James D. Ruth, during a news conference at Anaheim Stadium, said there were several issues that caused the breakdown. The two most crucial were the city’s desire to bring an NFL team to Anaheim as soon as possible and its proposal to build a sports, entertainment and retail complex around the stadium called Sportstown Anaheim.

“That’s our future,” Ruth said of the Sportstown project. “That’s our economic engine for the future. There was an inability [by Disney] to maintain the flexibility we felt we needed to preserve future development rights.”

Ruth and other city officials stressed their commitment to help the Autrys find another buyer and to keeping the team in Anaheim.

“We see baseball being in Anaheim long term,” Ruth said. “There will be other potential buyers out there.”

A source close to former baseball commissioner Peter Ueberroth said he is “standing by, ready to go,” with his original ownership group and his previous offer to purchase a minority share of the Angels for about $30 million. He was negotiating with the Autrys before the deal with Disney was announced.

Jackie Autry called Wednesday’s developments “kind of depressing.”

“I think the city, in its focus on Sportstown, has forgotten about the California Angels and trying to satisfy them short term and long term. Without the Angels, the Sportstown they envision won’t exist,” Autry said.

Regarding Ueberroth, she said: “Peter is still available to buy the club as are other people. But it’s premature to talk abut it.

“Peter would be an extraordinary buyer for the city if he can work something out.”

In January, Disney’s bid to purchase 25% and operating interest in the Angels contingent on an agreement with the city to renovate the stadium was approved by major league baseball owners. Disney set a March 17 deadline to reach an accord on the renovations to turn Anaheim Stadium into a more intimate, baseball-only facility.

“I think because of the time constraints imposed upon us, it was very difficult to reconcile the differences,” Ruth said. “I believe that given more time, we could have worked it out.”

The city, hoping that the renovated stadium would be an anchor for the Sportstown project, which has no known investors, had tentatively agreed to contribute $30 million to the estimated $100-million renovation.

Disney was to have assumed day-to-day operations of the stadium and received the bulk of the profits. The team’s name also would have been changed to the Anaheim Angels.

While a majority of the Anaheim City Council was ready to approve major parts of the deal, it was clear by late Tuesday night--when the council rejected Disney’s offer in a closed session--that the deal was off, city and Disney officials said.

“I thought we could do it, but Disney was asking for too much,” Councilman Lou Lopez said.

Several council members said they could not commit to a deal unless they were assured of a clear way to make back the city’s $30-million investment. At least $10 million was to have come from stadium advertising revenue. The rest of the money was to have been generated from Sportstown.

But Disney’s offer would have made it very difficult to move forward with Sportstown and then earn a return on the city’s investment, several sources said.

“Although I wanted to see a deal come together, I couldn’t support one that would not provide repayment of the city’s money,” Councilman Tom Tait said.

Tavares, who was Disney’s top negotiator, declined to name specific deal-breaking points, but he confirmed the company’s reservations about Sportstown, saying that the project and a new football stadium would not leave Anaheim Stadium with adequate parking and would interfere with the Disney “guest experience.”

“The city is trying to achieve maximum flexibility while we are trying to make sure we protect the interests of the fans,” Tavares said. “There were conflicts in those philosophies.”

Tavares added that “without being able to agree upon an overall public/private partnership, including providing adequate parking and other amenities to give our fans a quality experience, the economics of baseball in this facility do not make sense and do not create a situation in which we can field a competitive team.”

Having the parking issue resolved was considered crucial before an agreement could be signed because the city did not want a repeat of the 12-year legal battle that involved the city, the Angels and the stadium’s former tenant, the NFL’s Rams.

Last December, the city agreed to pay $13 million to end the dispute over development rights to a portion of the stadium parking lot, which the city granted the Rams as part of a deal to lure them here in 1978.

Tait and Councilman Bob Zemel had strongly opposed parts of a deal that had been tentatively approved by a majority of the council last week. Zemel complained that if the deal went through, it would have eliminated any chance of an NFL team playing at Anaheim Stadium this fall.

“We want to be able to incorporate Sportstown and football into the mix and accomplish all of our objectives,” Zemel said. “The city remains committed to baseball and this in no way means that baseball is leaving Anaheim or that the city is turning its back on baseball.”

The proposed project was launched amid much fanfare in January at a news conference not attended by Disney officials. Many had speculated that Disney would eventually jump on board, but sources close to the situation said the company has never expressed much interest in the project and may have been concerned that it would compete with long-delayed plans to open a second theme park next to Disneyland.

Although a disappointment for the city, Anaheim officials in the past have not sought to jeopardize the city’s economic future to advance a project for Disney or any other corporation.

The city refused to build a new stadium for the Rams, who then moved to St. Louis. Anaheim also declined to pay for more of the infrastructure improvements for the $3-billion Disneyland expansion project announced in 1991 and shelved in January. A revised project is scheduled to be unveiled later this year.

Tavares said the baseball situation would not affect the company’s future relationship with the city.

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Staff writers Mike DiGiovanna, Martin Miller, Ross Newhan and Geoff Boucher contributed to this story.

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Additional Coverage

* COMMENTARY

Who’s to blame? Disney and the Angels couldn’t have news conferences fast enough to get the spin going, Mike Penner writes. C8

* SAD FUTURE?

Without those Disney dollars coming in, there is concern from Autry and players that Angels will become a Mickey Mouse franchise. C8

* CHRONOLOGY: C8