SBD/6/Franchises

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  • DOES FINANCIAL RESTRUCTURING MEAN A SALE FOR SONICS?

         In a "minor shift in the business structure," Ackerley
    Communications restructured of all of its holdings and left the
    Sonics as a separate corporation, instead of being one of 14
    subsidiaries.  But according to MCCLATCHY NEWS' Bart Wright, "an
    implication was immediately obvious.  Large companies interested
    in testing the market for a certain portion of their holding
    often restructure in ways that set apart the desirable holding."
    But Ackerley Communications CFO Dennis Curley said the
    restructuring "changes nothing," and is "no indication at all of
    any reason to want to sell anything" -- including the Sonics.
    Wright writes that the move comes at a "curious time," and that
    the value of the franchise is higher now than any other time in
    its history, with "sizable" fan support a new arena, and
    expansion fees (Bart Wright, McCLATCHY NEWS SERVICE, 2/5).
    

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  • HAPPY IN HARTFORD, HAMMERED IN HARRISBURG

         While the Hartford Hellcats returned from the brink of
    elimination on Friday, the CBA turned to another failing
    franchise -- the Harrisburg Hammerheads.  According to the
    league, the Hammerheads were shut down on Thursday for "failure
    to comply with the by-laws and directives of the league's board
    of directors."  Although the league "didn't elaborate" on the
    team's conduct, Hammerheads owner Van Farber said that the CBA
    "had notified him it would fold the team if several terms were
    not met by last Wednesday."  Farber said the two main conditions
    -- paying for a $72,000 court he promised to both the city and
    state, and acquiring an additional $50,000 line of credit --
    "were impossible to meet in such a short time" (CHICAGO TRIBUNE,
    2/5).  The CBA is "expected to hold a dispersal draft" Monday,
    then spend whatever is necessary to rearrange schedules and
    travel plans (Flounders & Feeley, HARRISBURG PATRIOT, 2/5).
    

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  • PSL DEADLINE PASSES; WILL NFL ASK FOR PIECE OF PSL PIE?

         Friday's midnight deadline for the purchase of Permanent
    Seat Licenses in St. Louis produced a last minute rush that FANS
    Inc. officials estimate drove application totals to between
    50,000 and 60,000.  However, officials are still unsure if the
    46,000 seats set aside for PSLs will be sold out.  Because PSLs
    will be distributed by section, some sections may have more
    applications than seats.  FANS will know later this week whether
    the PSLs will sell out.  Either way, "organizers are elated" with
    the response, with the $60M generated by PSLs slated to go
    towards paying for the Rams' move.  FANS' deal with the team set
    a goal of selling 40,000 PSL and club seats by March 10 and
    50,000 by the '95 opener (Virgil Tipton, ST. LOUIS POST-DISPATCH,
    2/5).
         NFL'S PIECE OF THE POT?  Bernie Miklasz reports that NFL
    sources told the ST. LOUIS POST-DISPATCH that the league "may
    decide to ask the Rams and FANS Inc. for a percentage" of revenue
    generated by the PSLs.  While the league allowed the Carolina
    Panthers to use PSLs for stadium construction, Miklasz says the
    NFL "may be opposed" to $27M of the PSL money being "earmarked to
    retire bonds to improve Anaheim Stadium."  Miklasz thinks the
    league is "angling as a prelude to negotiations" with the team.
    Rams President John Shaw has taken the "early position" that the
    team has no obligation to pay a relocation fee to the league.
    Miklasz: "The guess is that Shaw and the NFL will initially take
    extreme positions and then negotiate a settlement somewhere in
    the middle.  The NFL may back off any pledge to garnish PSL money
    if Shaw agrees to pay the relocation fee" (ST. LOUIS POST-
    DISPATCH, 2/4).  Will McDonough reports NFL owners "want to make
    sure that gate money that should be going to them as the visiting
    team (40%) is not being funneled back to the home team via luxury
    box revenue."  Visiting teams do no share in luxury box revenue
    but shares in all other seat money. McDonough notes that "some
    owners also want to take a second look at what is going on in
    Carolina with ticket revenues" (BOSTON GLOBE, 2/5).
         PRACTICE FACILITY:  Under a proposal submitted Friday to the
    St. Louis Board of Aldermen, the city would pay a maximum of $5M
    to build the Rams a new practice facility.  Under the lease
    agreement with the city, the city-county convention visitors
    commission is required to pay for a facility.  Estimates have
    ranged as high as $16M.  The city plans on paying for the
    facility with a 5% amusement tax on Rams tickets (Thom Gross, ST.
    LOUIS POST-DISPATCH, 2/4).
    

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  • SHARKS REFUTE FINANCIAL WORLD STORY

         Although the latest issue of FINANCIAL WORLD estimates that
    the Sharks posted an operating profit of $15M last year, team
    President Art Savage said the figure was closer to $4M.  FW
    claimed "hockey owners wanted a new contract with the players in
    place before it became apparent just how much money teams were
    collecting from a new generation of arenas that began operating
    in San Jose and Anaheim."  In its February 14 issue, FW reported
    that revenue from new arenas, a TV deal, and long-term marketing
    agreements helped determine the league's strategy because NHL
    execs "knew that the longer the negotiations dragged on, the more
    apparent the league's imminent prosperity would become."  Savage
    said FW has both the "team's earning's and the owners' strategy
    wrong."  Savage: "It's is unfortunate (the author) doesn't have
    the slightest idea what he is talking about and he is able to
    publish it in a publication that's fairly well respected."  The
    SAN JOSE MERCURY NEWS estimates the Sharks made about $10M last
    year, which Savage also disputes.  Savage said his figure of $4M,
    "based on audited statements he would not release, is inflated"
    because it does not include $2.5M in signing bonuses (Barry Witt,
    SAN JOSE MERCURY NEWS, 2/4).  FW also reported the Sharks are
    developing a movie script, educational software, video games, and
    a coffe-table book.  Writes FW's Jason Starr, "Since the Sharks
    are developing these projects themselves, they will probably have
    to pay only a royalty to the league -- about 8% to 10% of the
    product's wholesale price for use of the NHL logos -- and keep
    the rest" (FW, 2/14 issue).
    

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  • VIKINGS MAY FACE MORE LEGAL PROBLEMS FROM EMPLOYEES

         Minneapolis attorney Marshall Tanick said he represents "a
    dozen employees and former employees who have found it necessary
    to hire an attorney to resolve issues related to the Vikings'
    workplace."  Tanick said there are no sexual harassment claims
    and that about half his clients still work for the team (Bruce
    Orwall, Minneapolis STAR-TRIBUNE, 2/2).
         GREEN A HOSTAGE?  STAR-TRIBUNE columnist Joe Soucheray
    criticizes the team for their "poorly staged theatrics" in the
    videotape the team released of Dennis Green talking about the
    incident.  Soucheray:  "I am convinced that Dennis Green, like
    Bobby Hall, was saying only what his captors forced him to say"
    (Minneapolis STAR-TRIBUNE, 2/2).
    

    Print | Tags: Franchises, Minnesota Vikings
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