(by Brian Staus soccer.si.com 2-21-14)
MLS commissioner Don Garber said Thursday that the league paid “market price” to rescue Chivas USA from Jorge Vergara’s hands, and it appears that MLS did, in fact, pay at the lower end of that range.
SI.com confirmed independently that the league spent around $70 million to take ownership of L.A.’s floundering second club. That same figure was reported Thursday evening by the Los Angeles Times and is similar to the price paid by Orlando City to join MLS in 2015. Manchester City and the New York Yankees were charged $100 million to launch New York City FC.
Considering the fact that L.A. is the country’s second most populous metropolitan area and Orlando ranks a distant 26th, MLS may have gotten a bit of a bargain. The league’s goal isn’t necessarily to make money off the transaction, however. It remains committed to finding a buyer for Chivas USA who will rebrand the club and move it to a new stadium built somewhere in the metro area. A strong second team in L.A. will be worth more to the league in the long run.
MLS commissioner Don Garber said Thursday that MLS has “had lots of conversations with local owners. There’s an enormous interest in participating,” and at least one new inquiry has come in since Thursday’s announcement.
Obviously, no new stadium will be ready by the 2015 season. If Chivas USA has a new owner by then, the renamed club would have to find a place to play while it pursues a new facility. Los Angeles anchors a massive area that contains several venues that might be renovated or retrofit for MLS play, but StubHub Center remains the most likely option. Owner AEG is a long-time league investor that should be willing to help find a solution.
Other leagues have faced similar situations, which haven’t always been resolved quickly. The NHL took over the Phoenix Coyotes in 2009 after its owner went bankrupt and didn’t sell it to an owner committed to Arizona until last summer. The NBA sold the New Orleans Pelicans, then called the Hornets, to Tom Benson in spring 2012 after owning the franchise for 16 months. Major League Baseball held on to the Montreal Expos/Washington Nationals for four years.
MLS has no intention or desire to let it linger that long, but Garber said Thursday, “We’re not in a rush. We believe in the opportunity [in L.A.]. We’re going to try to find a great local owner and we’re going to marry that owner with a strong stadium plan.”
Vergara, meanwhile, will be able to focus solely on helping his flagship club, Chivas de Guadalajara, return to prominence. Now on its seventh coach since the start of 2012, Chivas has qualified for the Liga MX playoffs only once in the past four seasons.
Vergara, the billionaire founder of nutritional supplement empire Grupo Omnilife, may have benefited from the Chivas USA deal. He and his former partners, Antonio and Lorenzo Cué, paid only $7.5 million to join MLS in 2005. Two years ago, Vergara and his wife, Angelica Fuentes, spent around $35 million to take over sole control of the club. Garber confirmed Thursday that Chivas USA “does lose money, and in some years it’s been a significant amount,” but Vergara was a partner for much of that time and wasn’t very ambitious with his MLS roster.
The sale seems like a win-win for both sides. Victory is something Vergara, at least, hasn’t been used to.
Welcome to the RSL Cup blog
I've been a fan of Real Salt Lake since it joined MLS and took to the field in 2005, and I've been a fan of MLS since it began in 1996. Lately however I've started to worry about the path MLS is taking and the poor decisions they are making that in my mind threaten the growth of soccer as a whole in the US. (see "Columbus conspiracy" section) Soccer in America will grow only when we have a vibrant and diverse minor league system, something that MLS seems to be smothering at the moment. (see "American soccer wars" section) Let's keep our eyes on the situation and hope for the best, a future where grass-roots soccer and the minor leagues can not only exist but flourish, as well as where the contributions and history of the league's early clubs are appreciated and preserved.