He Hopes Stars Come Out, and Bring Wallets

As Frank McCourt introduces himself to Dodger fans, he’ll be particularly pleased to make the acquaintance of rich guys with a love of baseball and money to burn. He’ll invite them to join him as an owner of the Dodgers.

To ease concerns about McCourt’s financing and expedite his $430-million purchase of the team, News Corp.’s Fox Group agreed to retain a minority share of ownership. The company nonetheless wants out as soon as possible, and McCourt has pledged to find limited partners to buy out Fox’s share, valued at about $40 million.

After major league owners approved his purchase Thursday, the Boston real estate developer said he would prefer to attract local investors “who can help us get acclimated in the community, who have their own networks and their own ways of helping us navigate the landscape here.” In particular, McCourt said, he hoped to tap into Hollywood.

Since the Dodgers moved to Los Angeles in 1958, the team has been owned wholly by the O’Malley family or by Fox. For the first time, then, a local investor can own a small stake of the prestigious hometown team, at least on the surface an alluring proposition.

However, as McCourt tried to assemble his financing package, sources said local investors as well as East Coast investors rejected his overtures. McCourt said he abandoned his efforts in the interest of concluding the purchase.

“People have been very enthusiastic about getting involved with the Dodgers,” he said. “We decided we’d buy it ourselves and get through the process.”

Said former Angel president Richard Brown: “If he was looking for partners up and down both coasts, it was for big amounts of money. Once he buys the team, there’s no requisite for big chunks of money. He can go ahead and sell smaller amounts, and a lot of people might very well come in.”

Those people would need to be content with paying up and staying out of the way. McCourt made it clear that he and his wife, Jamie, would run the daily operations of the team.

“Where it gets troublesome is if somebody gets in thinking he’s going to make trades and determine strategies,” said Larry Baer, chief operating officer of the San Francisco Giants. The Giants’ ownership group includes 23 limited partners, with Peter Magowan in the decision-making capacity of managing general partner.

“You can’t have multiple cooks in the broth,” Baer said. “The broth is too public and too complicated. You have to vest control in one person.”

Lewis Wolff, chairman of the Los Angeles investment firm Wolff DiNapoli LLC, formerly held minority ownership in the St. Louis Blues of the NHL and the Golden State Warriors of the NBA.

“When you’re a limited partner, your power is limited,” he said. “But it doesn’t mean you can’t shag fly balls or sit in the press box.”

McCourt can use such perks to entice the Hollywood crowd and other potential investors. Baer said the Giants have afforded their limited partners the chance to join the team on trips and at spring training. Nothing might be more alluring than the chance to win a World Series ring.

From within their community, the Baltimore Orioles attracted minority investors that included film and television director Barry Levinson, ABC announcer Jim McKay and tennis player Pam Shriver.

Wolff said he bought a share in the Blues to support his hometown team. Baer said a similar motivation spurred many of the Giants’ investors and could help McCourt as well.

“Our partners want to be part of something very important to the cultural fabric of the city,” Baer said. “It’s a great opportunity for somebody who wants to contribute to the community and to the passion that is Dodger baseball.”

Wolff said he made a nice profit on his investment with the Warriors. However, McCourt cannot promise any such return to potential investors who would act not out of civic duty or ego gratification but in search of profit. “He’s not going to go from a $45-million loss to a profit in 2004,” one major league executive said.

McCourt pledged to maintain a player payroll among the top one-fourth of major league teams, raising the possibility minority partners could be asked for more cash in years to come, forcing them to invest even more or have their stakes diluted by new investors. He acknowledged it would take “a few years” to restore the team to profitability.

“You invest in baseball because you love baseball,” McCourt said. “But there are some business sensibilities we can bring here.”

If losses linger, McCourt might face the unpleasant question of slashing payroll in search of profitability, in which case local investors might be derided within the community.

“That’s a non-starter in this market,” Los Angeles sports business analyst David Carter said. “There’s only three or four people that are going to like that, and they all own teams in the National League West.”

Wolff, now retained by the Oakland Athletics and charged with finding them a stadium site, said he was optimistic that top lieutenant Corey Busch, a former Giant executive, would help McCourt satisfy fans and investors.

“The Dodgers are a team that, if it turns around, could be extremely profitable. He’s got an excellent, solid guy in Corey Busch,” Wolff said. “If I wasn’t involved somewhere else, I’d be interested.”