Magic Johnson and WNBA President Laurel J. Richie announced the sale of The Los Angeles Sparks for an undisclosed price.
An investment group led by Los Angeles Lakers legend Magic Johnson and Mark Walter, founder and the chief executive officer of Guggenheim Partners and chairman of the Los Angeles Dodgers, announced Wednesday that they have purchased The Sparks, Los Angeles' financially struggling WNBA team.
On the court the Sparks have been a winner, taking home championships in 2001 and 2002 and tying for second best record in the league last year. But money-wise the team’s been a loser. Sparks CEO Paula Madison said her family firm has lost nearly $12 million on the team since 2007, and was projected to lose another million this year.
Madison told the WNBA just before Christmas that her firm could no longer afford to own the team.
“We know what we’re up against and that’s ok," said Magic Johnson, at a press conference staged next to his statue at Staples Center. "We love challenges and feel yes, we'll eventually make a profit, no question about it. That’s why we’re in business, to make a profit.”
Johnson didn’t offer specifics, except to say that he and the other investors will do with the Sparks what they’ve done in a year and a half since buying the Dodgers.
“We want to increase the fan experience because that’s what we did for the Dodgers and that's why we're number one in attendance," said Johnson. "We went from being in the middle of the pack to being number one."
The Guggenheim-led ownership group revitalized the Dodgers quicker than anyone expected, but Major League Baseball isn’t the WNBA, which hasn’t just been losing money, but also teams.
The league has included 10 teams since 2010, down from 16 in the early 2000's. The Sparks were one of the original eight WNBA teams when the league started in 1997.
Last year, the website 24/7 Wall St. put the WNBA on its list of "Ten Brands That Will Disappear in 2014."
Andrew Zimbalist, a sports economist at Smith College, thinks that's overblown, but says the league faces many obstacles, including the fact that it was formed by NBA owners mostly looking for a way to fill empty stadiums during the offseason.
“It strikes me that for even popular male sports it would be a tall order to get people to pay big money to go inside in the summer time,” said Zimbalist.
Still, Zimbalist is willing to give Johnson - and his ownership group - the benefit of the doubt.
“I suspect he’s learned a lot with the Dodgers," said Zimbalist. "I think he’s someone who has a lot of popularity and reach.”
The Golden State Warriors expressed interest in moving the Sparks to the Bay Area, before Johnson's ownership group swooped in.
"It was very close," Johnson told the Los Angeles Times. "We came in at the 11th hour, and I think we were the last ones. If we didn't come in and make a deal, I think it was gone."
The deal took less than a month to close, according to WNBA president Laurel J. Richie. The purchase price has not been disclosed.
"This is a great day for Los Angeles, the Sparks franchise, its players, and of course, the loyal fans who have been so supportive of the team for 17 seasons," Richie said in a statement.
Aside from Johnson and Walter, the group purchasing The Sparks includes Dodger co-owners Todd L. Boehly, Robert L Patton, and Stan Kasten, President and CEO of the Dodgers.