How AEG sale could make mess of stadium deal*

villaraigosa.jpgSo let's start with the obvious: If Mayor Villaraigosa was aware of plans to sell Anschutz Entertainment Group, why didn't he mention it to anybody, especially the folks who are negotiating the stadium/convention center deal with AEG? From the LAT:

"I'm not going to tell everybody everything we're doing," Villaraigosa said at a City Hall news conference. "Because we want a football team, and a lot of what happens here has got to be negotiated quietly."

Just in case you forgot, Villaraigosa is mayor of the city of Los Angeles - and as such has a fiduciary responsibility to help craft a contract that's in the city's best interest. And wouldn't it be helpful to those who are negotiating said contract if they knew what the mayor knew? More from the Times:

The City Council is nine days from a key vote on the stadium deal, which also includes major renovation of the city-owned Convention Center. When asked whether City Administrative Officer Miguel Santana, the top city negotiator, should have learned about the potential sale of the company sooner, Villaraigosa shook his head no. "I'm the mayor, and I knew," he said.

Here's what Councilman Paul Krekorian said this afternoon:

"Reports that Anschutz Entertainment Group may be sold have validated my insistence that the city slow down the express train of stadium enthusiasm and require ironclad financial safety measures to protect taxpayers. At my urging, fortunately, those protections are now included in the proposal, and the City will not be left holding the bag regardless of any changes in AEG's ownership or financial condition.

Anschutz has assured Villaraigosa that any buyer would have to agree to the terms worked out with the city. But agree how? In writing? With a handshake? What if the buyer doesn't like parts of the deal that AEG cut? Here's another question: What happens about getting an NFL team to L.A.? Last year, AEG CEO Tim Leiweke said it was important to have the stadium deal completed before the beginning of next year because that's when NFL owners need to inform the league of any sale or relocation. That provides enough time to prepare for the following season. But is it realistic to believe that the sale would be done by then? With Anschutz out of the picture, the process might be delayed. And if there's no team for at least another season, does the stadium deal pencil out? The sensible solution is to hold off on the stadium agreement until the AEG situation is resolved. Know who you're dealing with - don't take the word of the guy getting out.

*One more point: Several readers have speculated that the real reason Anschutz wants to sell is that it provides him with the cash to purchase an NFL team - along with having the stadium. There's no indication that this is the plan - and frankly, it seems unlikely considering that Anschutz was reluctant to pursue a stadium deal in the first place. Later, he made all sorts of financial demands in the event that a team became available. In other words, you just don't get the sense he's gung-ho about NFL football. Maybe he's reconsidered, but I wouldn't bet on it.

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Recent NFL stories:
Tim Leiweke says he'll be back in LA one day (video)
Forbes on what happened between Anschutz and Leiweke
Want clarity on the NFL's return to LA? Lots of luck
Leiweke on Anschutz: Not much of a football guy
Geez, now Anschutz is everywhere

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
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