Looking for the next move in the Glazer playbook Times Business Columnist © St. Petersburg Times published May 12, 2003
You can say a lot of things about Tampa Bay Bucs owner Malcolm Glazer & Sons - and you have over the years. But thanks to new respect earned by the Bucs first Super Bowl win, the Glazers appear to be making a serious run at purchasing the Los Angeles Dodgers. And raising some interesting business strategies in the process. What's the endgame here? Do the Glazers want to rebuild the Dodger baseball empire in the undervalued Los Angeles TV market? Would the Glazers adopt the Wayne Huizenga/Florida Marlins strategy and unload the Bucs while the team is a hot and high-priced commodity? Or is this simply a move to leverage the rising value of the Bucs franchise and potentially run up the value of another professional sports team? If the Glazers played their business plans closer to the vest, they'd have sutures. Malcolm made his first millions selling mobile home lots near Rochester, N.Y., and the Glazers still have a streak for the odd venture. Consider Rochester's Zapata Corp., a onetime Houston company founded by President Bush's father and now controlled by the Glazers. It owns a major stake in Omega Protein, a business that sells fish oil as a commodity. Omega, in fact, rents its headquarters in Houston from Zapata. Like a lot of rich business families, the Glazers have plenty of legal disputes. Some more bizarre than others. One of the more recent is a March lawsuit filed by Robert Strougo, a shareholder of Omega. Strougo claims the Glazers, including Malcolm's son Avram (Zapata's chief executive) and daughter Darcie (a Zapata director), breached their fiduciary duties by not properly considering a so-called buyout offer sent via e-mail to Zapata. This tale gets twisted when it was disclosed that the supposed buyer, a Florida partnership, is run by Theodore Roxford, a self-described corporate con artist now playing the role of wannabe corporate raider. In the Glazers' pursuit of the Dodgers, none of these distractions really matter. The Dodgers are for sale because a giant media conglomerate called News Corp., owner of the Fox TV network and controlled by Australian billionaire Rupert Murdoch, wants to divest the money-losing team. Early betting even hints the Glazers, their brand strengthened by the rise of the Bucs, are an inside favorite to win the bidding. That's because the Glazers can leverage a proven track record with a pro sports team. And they only want the Dodgers. That franchise looks likely to be price-tagged at between $350-million and $400-million, maybe more if a bidding war emerges. It probably does not hurt that the Glazers recently invested $14-million to purchase a small stake in Manchester United. The premier British soccer club's majority owner happens to be Murdoch. The other reported Dodgers bidders? Emmis Communications Corp., an Indianapolis media company headed by former Seattle Mariners owners Jeff Smulyan, with 24 radio stations (including one in Los Angeles) and an eye on some Fox TV stations. An investor group led by David Checketts, backed by Los Angeles billionaire Eli Broad and global financier George Soros, has offered $600-million for the team, its stadium and cable channel Fox Sports Net 2 that airs Dodgers games (an asset Murdoch is not keen on selling). Another group is headed by Los Angeles real estate tycoon Alan Casden. In April, NFL commissioner Paul Tagliabue added his blessing, saying it is possible for the Glazers to also run a baseball team without violating a league rule on cross-ownership. The Dodgers sale is, in fact, part of a larger sell-off of Major League Baseball franchises (pro hockey teams, too) by major corporations. The auction of the World Series champion Anaheim Angels has been in the works since last fall when owner Walt Disney Co. hired Lehman Brothers to search out a buyer. And struggling AOL Time Warner is peddling the Atlanta Braves, a team it acquired when it bought Ted Turner's business empire of CNN and Turner Broadcasting. Few of the bidders for these baseball teams are corporations. They are rich individuals. Like the Glazer family. Why this trend? Forbes magazine sums it up best: "Firms that buy teams tend to underperform." The Glazers' apparent infatuation with sports teams is long and deep. Sports reports over the past years say the Glazer family, at one time or another, had pursued ownership of the NFL's New England Patriots and New York Jets, as well as MLB's San Diego Padres and Pittsburgh Pirates. One scenario suggests the Glazers would buy the Dodgers, sell the Bucs - worth, for the moment, $600-million or more - and build a new L.A. stadium to accommodate their Dodgers team and a new NFL franchise that's been missing for years in the country's second-largest television market. Sound more like fantasy than reality? Maybe. Pro sports and billionaires dabble in both worlds all the time. One thing is very real. The Glazers are quite good at making money from their investments, even if some of it is tied up in fish oil and trailer parks. Let me share one brief story that sheds light on the Glazers. It ran earlier this year in the Village Voice, one of New York's alternative papers. It seems that a writer was invited a few years ago to a cramped hotel room at the Hilton in Manhattan to discuss ghost-writing a book with Malcolm Glazer. During the visit, Malcolm Glazer pointed to son Bryan. "You see those pants?" The writer noticed black pants, pleated and probably wool. "Those are Hugo Boss pants. They cost $200," Malcolm Glazer said. Then he added that his pants came from J.C. Penney, $19.95 on sale. Malcolm smiled and said, "And you know something? I like my pants more than he likes his pants. "You know why? Because I remember the day when I didn't have $20 to spend on pants." Bryan, the Village Voice recounted, "realizing that as much as he wanted to, he couldn't crawl under the hotel bed, settled for slumping down in his chair and turning roughly the color of a Buccaneer road jersey." The story's point? The elder Glazer knew the value of a buck. And just maybe, on the possible verge of a high-stakes deal for the Dodgers, the next generation is learning the same lesson. - Robert Trigaux can be reached at [EMAIL PROTECTED] or (727) 893-8405. © Copyright 2003 St. Petersburg Times. All rights reserved __________________________________ Do you Yahoo!? The New Yahoo! 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