South Korean retailer E-Land Group confirmed on Tuesday it is part of a consortium that is among short-listed bidders in the auction for bankrupt Los Angeles Dodgers baseball team, a move that could help it expand further in the sportswear business.
The storied U.S. baseball franchise, which Korean media estimate to be worth between $1.2-$1.5 billion, has attracted several top names from the business and sports worlds, including billionaire hedge fund manager Steve Cohen and ex-Yankees and Dodgers manager Joe Torre. Basketball great Magic Johnson was also in the running, sources previously told Reuters.
Unlisted E-Land has emerged as the surprise Asian bidder in the auction. E-Land recently expanded into construction and restaurants and operates discount retail outlets. It is also licenced to sell apparel brand New Balance in Korea.
The company, whose management principles are centred on Christian beliefs, donates 10 percent of its profits to charitable causes, according to its spokesman.
E-Land recorded an operating profit of 462 billion won ($411.3 million) for 2010 on sales of 4.6 trillion won, according to its website.
E-Land's confirmation came a day after local media reported the interest. E-Land declined to elaborate on the members of its consortium and said its potential investment in the Dodgers was aimed at diversifying into new business areas.
Baseball is one of most popular sports in South Korea, along with soccer and golf. Los Angeles also is home to a large Korean population and the city has defined an area in the Wilshire neighbourhood as Koreatown.
Yonhap news Agency reported that E-land had partnered with Peter O'Malley, a former owner of the Dodgers who signed pitcher Park Chan-ho to the team in 1994, making him the first South Korean to reach the Major League.
An estimated 12 parties submitted non-binding first-round bids for the century-old baseball team, the stadium and related assets. Before Los Angeles, the team was based in New York City and was known as the Brooklyn Dodgers.
PATH TO LA?
The Brooklyn Dodgers made history when it signed the first black player to the Major Leagues, Jackie Robinson, one of the greatest players of his era.
The LA Dodgers made history in 1995, when it signed Hideo Nomo, who became only the second Japanese player ever to reach the Majors. Nomo's success with the Dodgers is credited with paving the way for a wave of Japanese players who later joined the league.
While E-Land's precise motivation for a Dodgers deal remains unclear, at the very least it allows the company and its executives greater reach into the Los Angeles market, which has a large South Korean population.
One private equity investor familiar with E-Land said the bid makes sense if the firm is part of a consortium, since it provides a bridge for its brand into the United States.
While the source felt a solo bid would struggle to gain required approvals, he noted there is historical precedent for Asian ownership of a Major League baseball franchise: the former president of Nintendo, Yamauchi Hiroshi, became the majority owner of the Seattle Mariners in 1992.
The source was not authorised to talk to the media and therefore did not want to be identified.
The Dodgers landed on the auction block after owner Frank McCourt was forced to place the team under bankruptcy protection in June last year.
The sale is being conducted by the Blackstone Group and is being overseen by the U.S. Bankruptcy Court in Wilmington, Delaware. McCourt bought the team in 2004 for $430 million, primarily financed with debt.
Major League Baseball Commissioner Bud Selig said on Jan. 14 he was counting on the bankrupt team to be sold by April 30. Under the terms of a settlement between the league and McCourt, the Los Angeles businessman must sell the Dodgers and the stadium within that timeframe.