SBD/Issue 101/Franchises

Maloofs Remain Committed To NBA Kings Despite Mounting Losses

Maloof Refused To Cite A Figure, But Sources
Indicate Kings Could Lose $25M This Season
NBA Kings co-Owner Joe Maloof Monday "reiterated the family's commitment to the community," but he "expressed concern about projected financial losses and an urgency regarding plans for a new arena," according to Ailene Voisin of the SACRAMENTO BEE. Though Maloof "refused to cite a figure," sources indicated that the franchise "could lose up to $25[M] this season, making it seem more likely that the Maloofs would be receptive to offers from officials in other markets." One NBA exec "identified representatives from Anaheim and San Jose as particularly aggressive suitors." But Maloof said that the family has "no intention of selling majority interest or relocating." Maloof: "We've been approached constantly since we bought the team, and we're still here. We've never wavered. We've always kept our word." Voisin noted the Kings' "current plight involves a number of issues: The team has the worst record in the league, which contributes mightily to the poor attendance; the region represents one of the NBA's smallest markets in terms of corporate sponsorships; and the league's second-oldest arena offers few of the amenities that organizations rely on to generate revenue." On February 27, Baltimore-based Moag & Co. CEO John Moag, who was hired by NBA Commissioner David Stern to "resolve the protracted arena issue" for the Kings, "will present the Cal Expo board with a master plan that features a mixed-use project anchored by an arena for the Kings, concerts and other events, and with room for the California State Fair." But because of the worsening economic conditions, "several parties close to the situation state the obvious: Any potential deal figures to be a longer-term undertaking -- and require a greater commitment -- than originally anticipated" (SACRAMENTO BEE, 2/10).

WATCHING COSTS: In Sacramento, Sam Amick reported Kings employees are not "allowed to work overtime anymore. No OT at all will be approved." The Kings TV crew "has been cut in half," and the Kings' media relations department "now travels one representative instead of the previous two." Also potential trades "can not add to payroll. Period." Amick: "There's so much more to come it's not even funny" (SACBEE.com, 2/11). SLAM magazine's Marcel Mutoni wrote under the header, "Money Trouble Could Spell The End Of Sacramento's Kings" (SLAMONLINE.com, 2/10).

OWNING UP: The SACRAMENTO BEE's Voisin wrote Kings co-Owners Joe and Gavin Maloof "can end the angst simply by standing and shouting, by slamming the door, by reassuring a community that has hugged its professional franchise for the better part of three decades." The Kings "belong to Sacramento." Voisin: "Say it out loud, again and again. The best owners in professional sports don't savor the good times and then split when the team hits its downward cycle and the economy slumps." The Maloofs are "suffering, but they have enjoyed a pretty sweet ride" since acquiring the team in '99. Voisin: "Quality owners and civic leaders don't cut and run during the tough times, which is why I believe the Maloofs will bite their nails, swallow their losses and jump back into the new arena tussle" (SACRAMENTO BEE, 2/11).

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