VA-based Savvis Communications formally announced it
has purchased naming rights (see THE DAILY, 8/28) for the
Kiel Center. The arena will now be called the Savvis Center
(Savvis Communications). In St. Louis, Chern Yeh Kwok
values the deal at more than $70M over 20 years. Blues
President Mark Sauer said that the deal, to be paid in cash
and stock options, will allow team management to reduce its
"annual cash deficits," which average about $20M per year.
Also under the deal, the Kiel Center's Web site will be
renamed www.savviscenter.net, and the site, as well as the
Blues' site, will be operated by Savvis. Sauer added that
if an NBA team was "brought" to the arena, a clause in the
contract "allows the Blues to make an adjustment to Savvis'
fee." Savvis Chair & CEO Robert McCormick, on the deal:
"It's the perfect opportunity for us to cement our name in
people's heads." McCormick also said the deal will take up
"a small percentage" of the company's ad budget. McCormick:
"It would cost more to do advertising otherwise" (ST. LOUIS
POST-DISPATCH, 8/29). The AP reports that because the deal
is in both stock and cash, the "exact price isn't known."
Savvis was trading "just above" its 52-week low of 7 1/2
yesterday on the NASDAQ. The AP added that while the deal
"will add a source of revenue," it's "far from enough for
the Blues and the arena to break even. That's almost
entirely dependent on attracting an NBA franchise to St.
Louis." But when asked if there was any news about his
"effort to bring" an NBA expansion team to the city, Blues
Owner Bill Laurie replied, "Nothing" (AP, 8/29).
SUCCESS STORY: In St. Louis, Peter Shinkle, noting
Savvis was originally called Diamond Net when it was founded
in '95 in St. Louis and writes: "Savvis had been one of St.
Louis' biggest Internet success stories." The company is
now based in VA (ST. LOUIS POST-DISPATCH, 8/29). McCormick
noted that the sponsorship "will enhance the region's image
as a center for high-tech industry." McCormick: "St. Louis
is a great place; we know that, but others don't
necessarily. We also know that St. Louis has some high-tech
industry. Others will get that idea" (POST-DISPATCH, 8/29).
