Bud Selig, who originally approved McCourt as owner, now appears done with him
As his team optimistically prepares for a new season in the Arizona desert, Frank McCourt is desperately trying to line up financing after Major League Baseball commissioner Bud Selig denied him the chance to borrow serious money from Fox. In a move that many will interpret as Selig's washing his hands of the distracting and embarrassing McCourt drama, MLB last month rejected a plan that would have given him an additional $200m to play with. Bill Shaiken of the LA Times reports:
Baseball Commissioner Bud Selig has rejected a proposal under which Fox would have lent about $200 million to Dodgers owner Frank McCourt, three people familiar with the discussions told The Times. McCourt would have used the Dodgers' cable television rights as collateral, extending the team's current contract with Fox by as many as four years if he did not repay the loan, according to the individuals, who were briefed on the proposal but who are not authorized to discuss it.
Selig made his decision several weeks ago. Since then, McCourt has continued to explore financing options that would enable him to satisfy the commissioner and manage a debt that, according to court records, exceeded $430 million as of November 2009.
The Times reported last month that Fox had advanced McCourt money from the team's current television contract to help cover operating expenses. Sugerman declined to discuss how Selig's decision might affect McCourt's ability to manage the Dodgers' finances.
Selig has indicated he might withhold approval of any minority investor or broadcast contract proposed by McCourt. The commissioner last year rejected a proposed TV deal between Fox and the Texas Rangers, one that would have eased the severe financial burdens on Tom Hicks, then the Rangers' owner.
The team ended up in Bankruptcy Court. Fox considered bidding for the Rangers so as to secure the team's television rights, then negotiated a contract with the team's new owners, worth a reported $1.6 billion over 20 years.
That deal averages $80 million per year. The Fox loan to McCourt could have enabled the company to secure an extension to the Dodgers' rights at about $50 million per year had McCourt not repaid the proposed loan.
