SBD/Issue 87/Franchises

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  • Source: Pistons Not For Sale But Could Be In Not-So-Distant Future

    Davidson Could Sell Pistons And Palace
    Sports & Entertainment In Near Future
    The Pistons are "not for sale but could be in the not-so-distant future," according to a source cited by Vince Ellis of the DETROIT FREE PRESS. At issue is whether team Owner Karen Davidson "wants to continue to own an NBA franchise." It is also unknown what she "wants to do, if anything," with Palace Sports & Entertainment. The source said that it is "believed that any decision to sell the team right now would not be made solely by Davidson but by a collection of the heirs and trustees" of Bill Davidson's estate (, 1/18). In Detroit, Gallagher & Ellis note "adding more complexity to the mix was speculation that a sale could include a partnership with the Ilitch family, perhaps to build an arena that would host the Pistons and the Ilitch-owned" Red Wings. In the "most basic formula possible, Karen Davidson could sell the Pistons and, perhaps separately, Palace Sports & Entertainment" (DETROIT FREE PRESS, 1/19).

    KEEPING THEIR OPTIONS OPEN: In Detroit, Chris McCosky notes the Red Wings have "yet to renew their lease with Joe Louis Arena" beyond this season, and although Red Wings GM Ken Holland said that he "fully expects the team to play at the arena next season, the Ilitch family has been seeking other options." Sources said that the idea of forming a partnership between the Pistons and Red Wings ownership groups "to build and share one sports complex has been discussed." Sources said that the Pistons "would consider moving back downtown in such a shared venue." But those talks are "extremely preliminary." With Davidson "looking to sell the team and arena, the new ownership group would have to be on board with the idea" (DETROIT NEWS, 1/19).

    ESTATE PLANNING: Sources noted that the "process of settling the huge Davidson estate is mind-numbingly complex and will take at least several years to complete." There is "no telling how much the Pistons, Palace and other properties might fetch if and when Karen Davidson decides to sell them." The DETROIT FREE PRESS' Tom Walsh: "Selling the Pistons today would be like selling a stock at its 52-week low, which is just one of several reasons not to expect a big deal right away" (DETROIT FREE PRESS, 1/19).

    FOUR SCORE: In Detroit, Michael Rosenberg writes Detroit "needs a new generation of sports ownership for all four of its pro teams." The last time a Detroit team was sold was in '92, when the Ilitch family bought the Tigers from Tom Monaghan. That is a "combined 72 consecutive years of continuous ownership for Detroit's four teams." The team with the "most certain future is the one that has the most pathetic present." The Lions "surely will end up in the hands" of Vice Chair Bill Ford Jr., and "while nobody knows if he will be a great owner, he should at least be a different owner" than his father. Mike Ilitch "seems poised to hand the reins to his son Chris," but that is "not as clear a line of succession as it might seem" (DETROIT FREE PRESS, 1/19).

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  • MLBPA Reportedly Watching Additional Teams Over Payroll

    Rays Identified As One Of Four Teams In Union's
    Sights Following Marlins' Payroll Agreement
    Following the Marlins' agreement with MLB and the MLBPA to raise payroll, no other such deals "have been reached and none apparently will be sought until after April 1," but the Pirates, Rays, Padres and Royals "remain in the union's sights," according to sources cited by baseball writer Murray Chass. April 1 is the deadline for "revenue-sharing recipients to report on their use of the 2009 money." MLB Exec VP/Labor Relations Rob Manfred "declined to confirm the identity of teams that have been discussed with the union." However, he admitted, "We've had more conversations than just about the Marlins. It's not a Marlins-only issue." Rays Owner Stuart Sternberg said that he "knew nothing about the union's interest in the Rays' use of the Rays' revenue-sharing money." Sternberg: "I saw the thing with the Marlins, but we've never been asked at all about it so whether we are or not I don't know. I think we've invested a lot in the team, and certainly you can see the results from it." Padres Vice Chair & CEO Jeff Moorad also said that he was "not aware of any union interest in the Padres." Pirates President Frank Coonelly did not return calls seeking comment. Meanwhile, no figures were released regarding the Marlins' deal, but a source said that the team's "share of the revenue-sharing pool has been around $40[M] a year;" the Marlins' '09 payroll was $36.8M. Chass reported last week's agreement "resulted from extensive talks among the three parties and forestalled the union's plans to file one or more grievances alleging that multiple clubs were violating the part of the collective bargaining agreement dealing with revenue sharing." MLB Commissioner Bud Selig's office "evidently felt the union had a strong case against the Marlins and didn't want to risk a hearing before an arbitrator because too much financial information would most likely had to have been disclosed" (, 1/17).

    CAUSE AND EFFECT? In Miami, Clark Spencer reports the Marlins yesterday signed 2B Dan Uggla to a one-year, $7.8M contract, the "third-largest deal in Marlins history for a single season." Uggla's deal could make him the "richest player on the team next season" (MIAMI HERALD, 1/19). The deal "does not preclude the Marlins, who have been shopping Uggla, to trade him before Opening Day" (South Florida SUN-SENTINEL, 1/19). Meanwhile, ESPN's Buster Olney said of the Marlins last week signing P Josh Johnson to a four-year, $39M extension, "A lot of people are going to say, 'Wow, this deal was finished right after the Marlins got their wrist slapped by [MLB] and by the players' union.' I think it's a total coincidence -- the timing of this deal -- because these negotiations were way down the line. ... On top of that, the Marlins already have been increasing payroll" ("Baseball Tonight," ESPN, 1/15).

    WHAT TOOK SO LONG? In N.Y., Bill Madden wrote, "What took the union so long to press the issue of teams pocketing their revenue-sharing booty instead of spending it on players -- which is what the system was supposed to be all about?" It took Red Sox Owner John Henry, a "longtime Selig loyalist, to blow the whistle on baseball's revenue-sharing welfare cheats" (N.Y. DAILY NEWS, 1/17). Meanwhile, in Boston, Nick Cafardo wrote MLB player agent Scott Boras' November comments regarding revenue sharing "had a major effect on last week's union demand for the Marlins to spend more money on payroll." Boras at the MLB GM meetings in November said that some teams "weren't using their revenue-sharing and central-fund sourcing money to improve their rosters." The Marlins were "one of the teams targeted and, lo and behold, the union was able to get assurances from them and [MLB] that they would start using their free money for payroll." Cafardo noted the Pirates "for some reason ... continue to fly under the radar in this regard," as they "were not part of this conversation between the union and MLB" (BOSTON GLOBE, 1/17).

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  • Did Cardinals Add Fuel To Fire With McGwire Treatment Sunday?

    Writer Says McGwire Should
    Hold Legit Press Conference
    The MLB Cardinals "didn't help themselves or Mark McGwire on Sunday" by allowing the team's new hitting instructor to hold a six-minute Q&A with fans, followed by a six-minute news conference with media members, according to Bernie Miklasz of the ST. LOUIS POST-DISPATCH. The best way for the team to "get the media to stop hounding McGwire is to call a legit press conference, take plenty of time to give interested media a chance to show up and ask questions, and do it in a professional and civilized setting." But by instead denying "full access and time to McGwire on Sunday, the Cardinals only allowed this situation to fester, and all but guaranteed that they’ll have more people bugging" McGwire during Spring Training. McGwire insists that he has "nothing to hide, and the Cardinals insisted that they wanted him to be open in handling his past, but Sunday’s silliness made it look like the player and the team were anything but open." Miklasz: "If the Cardinals think they’re going to be able to muscle the media away from McGwire, I can assure them that all they’re doing is setting up a situation where they’ll have to deal with more disruptions and distractions" (, 1/18). The Cardinals estimated that about 17,000 fans attended the three-day Cardinals Care Winter Warm-up event (ST. LOUIS POST-DISPATCH, 1/19).

    ROOT FOR THE HOME TEAM? In St. Louis, Bryan Burwell writes it was "embarrassing nonsense" that Cardinals fans greeted McGwire with a "rousing, standing ovation in his first public appearance here since admitting he used a potent array of performance-enhancing drugs while becoming a celebrated home run king." By applauding McGwire, the Cardinals fans are implying that they are "no different from the Giants-Barry Bonds fans and the Dodgers-Manny Ramirez fans." These are the fans who "will provide McGwire, the Cardinals and Commissioner Bud Selig all the cover they think they need to continue getting away with the scam they are trying to perpetrate" (ST. LOUIS POST-DISPATCH, 1/19).

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  • Former Birmingham City Owners Complete West Ham Takeover

    New West Ham Owners
    Pay $81.7M For 50% Stake
    Former EPL club Birmingham City co-Owners David Sullivan and David Gold have "completed their takeover" of EPL club West Ham United, according to Jacob & Smith of the LONDON TIMES. Sullivan and Gold paid around $81.7M (all figures U.S.) for a 50% stake, "valuing the club" at $171.6M. Sullivan and Gold "will have the final say on all club matters," and former Birmingham City Managing Dir Karren Brady will become West Ham Vice Chair. Sullivan said their "long-term aim will be to put the club on a stronger financial footing." Sullivan: "We have a seven-year plan to take the team into the Champions League and make it a big club. ... Over seven years we plan to spend a lot of money and we hope to persuade the government to let us move to the new Olympic Stadium, and I believe the people of east London would support that move." Jacob & Smith note Gold and Sullivan's offer for the club was "preferred to a series of other offers," including from London-based investment company Intermarket, which "made the highest bid but was unable to prove that it had sufficient money for a takeover." An American group was "favoured by the banks that are owed nearly" $81.7M by the club, but it "withdrew because its request for exclusive talks was rejected" (, 1/19). In London, Jason Burt notes Sullivan as part of the deal "has been given 'operating control' of the club although he cannot make any significant financial investments without the approval" of Iceland-based bank Straumur, which owns the other 50% of the club. Sullivan "has an option to buy the remainder 50[%] at a fixed price at any point in the next four months." If he "does not do so within that timeframe then the price ... goes up" (, 1/19). 

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  • EPL Franchise Notes: Hicks, Gillett Continue Investor Search

    Gillett (l), Hicks (r) Continue To Search For A
    New Investor To Buy 25% Stake In Liverpool
    In London, Jonathan Northcroft reported Liverpool co-Owners Tom Hicks and George Gillett "continue to cast around for a new investor to buy a 25% stake in their club," for $163.3M (all figures U.S.). But Hermes Sports Partners' Harry Philp said, "I don't see why anyone would buy that minority stake. You'd pay [$163.3M] into getting one quarter of a dysfunctional football club and your money would go straight to the bank, to service Hicks and Gillett's debt." Meanwhile, Liverpool Managing Dir Christian Purslow last week "branded building a new stadium as 'the key' to Liverpool being able to contend with other leading clubs," but Philp noted the cost for an investor of buying the club and building a new stadium would be $1.3B "before you start on players." Philp: "In the current market, finance for football club buyouts is brutally hard to come by and there are no investors out there saying, 'I'm desperate to lend to the football sector'" (LONDON TIMES, 1/17).

    CLUB RESPONSIBILITY: EPL CEO Richard Scudamore said that any club that went out of business "would be guilty of 'rank bad management.'" Scudamore: "You can't say it is impossible to imagine a Premier League club going out of business, that would be foolish. Given the amount of central income that is generated by the Premier League, it would be down to absolutely rank bad management if a club itself was actually to go into administration." Portsmouth have "struggled to pay their players three times already this season and currently are banned from transfers," and Scudamore insisted that the club's "transfer embargo will stay in place until they have no outstanding liabilities" (PA, 1/17).

    MORE BOND DETAILS: In London, Paul Kelso reports Manchester United owners the Glazers “could take out more than” $980M from the club’s revenues over the next seven years. Analysis of the bond prospectus distributed to investors reveals that in addition to annual interest payments of more than $490M, the Glazers can take a guaranteed $261M in “dividends, one-off payments and fees out of the club.” The terms of the bond also “allow the family to take additional annual eight-figure dividends based on a complex formula relating to the ratio of income to interest.” Applied to last year's figures, which saw net income of $68M, the Glazers "could have claimed a dividend of almost" $34M (London TELEGRAPH, 1/19).

    SUBTLE LEADERSHIP: In London, Mikey Stafford noted while the American owners of Manchester United and Liverpool have been "unleashing unsettling bond issues and abusive emails," Aston Villa and Browns Owner Randy Lerner "has been grabbing attention simply by not being in the country." Aston Villa manager Martin O'Neill said of Lerner, "Ours has never been a case of going out and throwing lots of money at the whole scenario for a short-term fix. ... He's not (reckless). He's still very enthusiastic about it all, he's still got some plans for Villa Park as well, which will be great if they happen, but overall his view is not one where he will be reckless" (London OBSERVER, 1/17).

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  • Franchise Notes

    Texans Increasing Ticket Prices By
    Average Of 6.67% For Next Season
    In Houston, John McClain reports the Texans are "increasing ticket prices by an average" of 6.67% for next season. The average ticket next season "will cost $71.86 compared to $67.37 last season." The Texans "didn't change the price for 20[%] of the tickets at Reliant Stadium," and they "lowered ticket prices for more than 550 seats in the Gridiron section" (HOUSTON CHRONICLE, 1/19).

    FREEZING, LOWERING PRICES: In St. Petersburg, Rick Stroud reports the Buccaneers "won't be raising ticket prices for the second straight year." It also will be "significantly less expensive to watch the Bucs in 2010 in certain upper sections of Raymond James Stadium." The team "will introduce a $35 general ticket price, which is $7 less than the most inexpensive seat over the past two seasons." An upper corner season ticket "that sold for $65 is now $49." The "biggest reduction came in the upper side of the end zone, going from $65 to $35." The Tampa Sports Authority noted that the Buccaneers' home attendance "fell 10.1[%] last season." They averaged 49,621 in attendance, "below the capacity of 65,821" (ST. PETERSBURG TIMES, 1/19).

    BEHIND THE STEEL CURTAIN: In Pittsburgh, John Harris writes, "Who has the juice, the real power, on the Steelers? If you thought it was coach Mike Tomlin, think again." Steelers President Art Rooney II has "all but ordered Tomlin to change his offensive philosophy and get back to the ground game next season." Harris: "Is a public reprimand any way to treat the coach who won the franchise's sixth Super Bowl? It is as if Rooney II believes Tomlin's coaching performance was as ineffective in 2009 as it was outstanding in 2008" (Pittsburgh TRIBUNE-REVIEW, 1/19).

    PARTY TIME: CRAIN'S CHICAGO BUSINESS' Ed Sherman noted Blackhawks President John McDonough "hosted a special party Saturday for Blackhawks season ticket holders at the United Center." The team "essentially held an open house, inviting fans to lockerroom tours and have their pictures taken on board a Zamboni." The "highlight was a chance to skate" on the ice. During the event, the video board "showed the live broadcast of the Hawks' game in Columbus." Approximately 8,000 fans "took advantage of the opportunity" (, 1/18).

    MONEY MATTERS: In N.Y., Jeane MacIntosh reported tax records indicate that charities tied to Mets Chair & CEO Fred Wilpon and team President Saul Katz "got hosed" for $8M in the Bernie Madoff scandal. The Mets Charity Foundation -- which counts Wilpon, Katz and Mets COO Jeff Wilpon as trustees -- "took the biggest hit, losing $3.8[M] in the investment scheme." The records indicate that the loss left the $4.8M foundation with "'an inadequate amount of financial resources on hand' to 'immediately satisfy' $752,000 in payouts to some of its causes, including $80,000 earmarked for Dominican Republic hurricane relief and $6,900 for the James Plummer scholarship" (N.Y. POST, 1/18).

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