Nobody knows much about the Anschutz Entertainment Group, the massive sports/entertainment entity that owns Staples Center (and the whole L.A. Live complex), a healthy slice of the Los Angeles Lakers, and majority stakes in the Los Angeles Kings, L.A. Galaxy, and oodles of other franchises. What's there to know?
In January 2012, on the occasion of the possible construction of a football stadium in L.A., a project which would bring an NFL team or maybe two, The New Yorker took a crack at understanding what goes on there. Philip Anschutz, who came from oil money, is the reclusive, cutthroat, religious, old-timey conservative man behind the corporation. (He funds those mysterious values billboards and makes minority partners miserable. He rarely gives interviews.) Tim Leiweke, the group's CEO, is the entertainment expert, the public face, the dealmaker with local politicians. And they really wanted a stadium in downtown L.A. That's about all we found out.
Then, in September, strange news: Anschutz wanted to sell his entertainment assets. The nation's biggest sports group, up for grabs (at least, up for grabs to anyone who could find $10 billion lying around). From a financial perspective, it made some sense: L.A.-based sports franchises seemed especially attractive to buyers in 2012. But the Anschutz team had poured so much time and effort into sticking a stadium in their complex that it seemed odd they'd offload the whole business to another.
And it turns out they won't. According to the Wall Street Journal, Anschutz took the company off the market today. He couldn't find anyone who'd pay the price he was looking for:
Other people close to the sales process have said AEG and its advisers on the sale at Blackstone Group LP weren't able to generate interest in the company at the high single-digit billions, or even at the $10 billion price tag, they had been seeking.
Also, for the most recent year, AEG's earnings before interest, taxes, depreciation and amortization stood at about $350 million, according to people who reviewed the closely held company's numbers. In comparable transactions, earnings in that range would suggest a value of less than $5 billion, significantly below what the company and its advisers were looking for.
Does this mean anything for sports business more broadly? It's hard to say: Some people decided a company that should be worth $5 billion was worth six or seven billion instead of nine or ten billion. The numbers are too big, and the market's so far from open. A $10 billion purchase would have signaled more. (That said, if you know anything more about the failed sale, email me!)
But it does augur plenty for the future of the NFL in Los Angeles. Anschutz also announced today that Leiweke would be leaving the company, and that he would take a more active role in managing it. Which means the path to football in Los Angeles still runs through a 73-year-old culture warrior.