Now, 14 years later, federal investigations into other companies in Walter’s empire and his surprising decision to sell his majority stake in the NBA’s Los Angeles Lakers have brought renewed attention to his initial entry into the sports world.
When he bought the Dodgers, some powerful figures in MLB ownership circles had questions about how Walter, CEO of Guggenheim Partners, planned to fund the purchase. But they also reveled in what his record-shattering $2.15 billion bid would mean for their own teams’ valuations.
Some MLB owners privately questioned Walter’s use of insurance money in financing the team’s purchase, according to contemporaneous news reports and recent interviews conducted by The Athletic. But during the sale, MLB’s central office and the league’s other franchise owners didn’t have the full control they normally wield. A federal bankruptcy judge oversaw the process.
Marc Ganis, president of the Chicago-based sports business consultancy SportsCorp, said the bankruptcy left MLB with little room to object.
“If left to their own devices, I think it would have been very unlikely that Major League Baseball would have approved this source of capital,” Ganis said. “But, because it happened through a bankruptcy process, baseball’s hands were tied.”
Just how much control MLB surrendered during the bankruptcy — and whether the league ultimately would have approved Walter’s ownership group without the court’s involvement — is unclear.
Two people briefed on ownership matters who were not authorized to speak publicly told The Athletic that Walter’s bid likely would have been rejected through the league’s typical process.