While no one knows how many gold medals Michael Phelps and other U.S. athletes will take home from the upcoming London Olympic Games, four local companies are already winners.
Aecom Technology Corp., AEG, Ticketmaster and OSI Systems Inc.’s Rapiscan division all will play big roles in the games. What’s more, some are using the platform to jump into more work in Great Britain or at other global sporting events after the Olympics, which will run July 27-Aug. 12.
“The Olympics have definitely boosted our profile in the United Kingdom,” said Tim Leiweke, chief executive of downtown L.A.-based AEG, which operates the O2 Arena that will host the basketball and gymnastics events. AEG is bidding to operate the newly built Olympic Stadium once the games conclude.
Aecom, which is doing the master plan for the massive Olympic Park development project in East London, is hoping its $50 million worth of work for the games will spawn a major global sporting events practice. It already trumpeted its London work to win a planning contract at the 2016 Summer Olympics in Brazil’s Rio de Janeiro.
“It’s not just planning for the events themselves, but for the communities long after the games are done,” said Bill Hanway, Aecom’s executive director of operations, planning, design and development. “Global sports is becoming one of our key market sectors.”
Hawthorne-based OSI’s Rapiscan unit, which has a $31 million contract for security screening technology and services for the London Games, already had a thriving Olympics practice.
“We’ve only missed one Olympics in the last 20 years,” spokesman Ajay Vashishat said. “So it’s become a tradition for us.”
In addition, Beverly Hills-based Live Nation Entertainment Inc.’s Ticketmaster is the principal seller of tickets to the games, with more than 4 million sold through May. Jacqueline Peterson, spokeswoman for the ticketing company, said Olympics exposure should boost the company’s business with clients throughout Britain and the rest of Europe.
Overseas work
It’s remarkable that four L.A.-area companies are playing such significant roles in the London Games, performing work that often in the past has gone to companies in the host countries, said Dame Barbara Hay, British consul-general in Los Angeles.
“The size of these contracts exceeded even our expectations as we were aiding these companies in their efforts to get the work,” Hay said.
She noted that all four companies already had extensive operations in Britain, which is a prerequisite for bidding on games-related work.
Both Aecom and AEG were working on Olympic venues even before London was awarded the games in 2005. Aecom inherited the East London planning work when it acquired Edaw Inc. in late 2005; Edaw had already been working on the project for two years.
AEG had signed a long-term lease with the British government in 2002 to develop and operate an arena and an entertainment complex inside the landmark Millennium Dome. The company subsequently paid about $1.8 million to help finance the London Olympics Committee’s bid for the 2012 games and participated in presentations to the International Olympic Committee. The goal was to schedule the Olympics’ basketball and gymnastics events at the company’s arena if the games came to London. Since then, AEG has poured an estimated $1 billion into the project, now known as the O2 Arena.
AEG also purchased a company that ran Clipper Thames boats along London’s river; 16 of those boats are now operating and will be able to ferry up to 250 passengers each to various Olympics-related events.
Leiweke said AEG encountered some rough patches during its work on the Olympic Games, especially during the bid process in 2004-05.
“It was semicontroversial for a Los Angeles-based company to be so active in the London bid,” he said.
That’s where the British Consulate’s Office came in.
“They helped us when we were trying to get the deals; they helped us especially with the politics in Great Britain,” he said.
Also noteworthy: The U.S. Olympic Committee chose Scott Blackmun, former AEG chief operating officer, as its chief executive.
AEG is still trying to get the contract to run the newly built Olympic Stadium after the games, which would allow the company to book concerts and sports events there, hire concessionaires and oversee all other operations. After its bid was rejected in the first round, AEG and other bidders protested that the process was unfair and the round was thrown out. A new round is slated for either late this year or early next year.
“We intend to bid,” Leiweke said. “But there’s no timetable on that until after the games finish.”
Planning effort
The Olympic Stadium is at the heart of the redevelopment area in East London for which Aecom has led the master planning. Six other companies are working on the master plan.
“This wasn’t just a case of putting in a stadium,” Aecom’s Hanway said.
Until the current modernization plan, the neighborhood was dotted with shuttered factories and vacant lots.
“The area needed to be decontaminated, power lines needed to be put underground, roads needed to be realigned, and more health care and school facilities were needed,” he said.
The challenge, he continued, was dealing with two different sets of goals at once: making sure the Olympic Stadium would fit in while also revitalizing the surrounding community. The second goal, he said, will be the focus of a follow-on Aecom project that will begin once the Olympic Games conclude next month.
Hanway said this dual focus will be the template for the company’s work on other global sporting events, including the Rio de Janeiro Olympics in 2016.
“This shows an ability to leverage the front-end investment in the games to ensure that there’s a long-term investment and legacy in the community,” he said.
