SBD/Issue 88/Franchises

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  • Rams Owners Closing In On Decision To Sell Or Keep Team

    Rams Owners Reportedly Have
    Three Offers To Buy The Team
    Rams co-Owners Chip Rosenbloom and Lucia Rodriguez are "closing in on a decision to accept one of three offers to purchase the team or walk away from the bidders and keep the franchise," according to NFL sources cited by Jim Thomas of the ST. LOUIS POST-DISPATCH. A decision "could be reached before the NFL draft in late April, not because of any kind of firm deadline, but simply to avoid uncertainty surrounding the team and its future entering the 2010 season." All three offers, which the sources described as "acceptable," are "comparable to what the Pittsburgh Steelers franchise recently sold for" -- $720-800M. The "only known bid for the team is from a group of investors headed by" SCP Worldwide Chair Dave Checketts. The three bidding groups are "committed in varying degrees to keeping the franchise in St. Louis, and that may have an impact on any sale decision." Thomas notes "at least one of the bids is for the full 100[%] of the team, in which case" Stan Kroenke's 40% share "would be bought out as well." But if Rosenbloom and Rodriguez "end up selling only their 60[%] of the team, Kroenke could potentially scuttle the deal by saying he wants to 'cash out.'" Sources said that Rosenbloom has "yet to get any indication from Kroenke on what he will do." Kroenke has "matching rights on any outside offers for the team," but under current NFL cross-ownership rules, he "would not be allowed to exercise that right as long as he owns majority shares" of the Nuggets and Avalanche. Some "clarity could be added to the issue this week," as Rams execs are meeting in L.A. today and tomorrow for the team's annual end-of-season summit meeting. Kroenke is "expected to attend at least one day's worth of the meetings." If he indicates that he is "on board with any sale decision," an agreement "could be signed relatively quickly" (ST. LOUIS POST-DISPATCH, 1/20).

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  • Former Pistons Investor Confirms Davidson Preparing To Sell

    Karen Davidson Has Reportedly Talked
    To NBA About Pistons Sale Process
    Former Pistons minority owner Oscar Feldman yesterday confirmed that team Owner Karen Davidson is "preparing to sell" the franchise, according to Bill Shea of CRAIN'S DETROIT BUSINESS. Feldman said Davidson, who inherited the team after the passing of her husband, Bill, in March, is "inquiring into selling the team, and her limited partners concur in that decision." The franchise is currently "run by a five-person board:" Karen Davidson; Bill Davidson's son from a previous marriage, Ethan Davidson; estate trustees John Aaron and Eric Garber; and Palace Sports & Entertainment President & CEO Tom Wilson. The trustees are "believed to have financial control of the team while" Bill Davidson's estate is settled. Feldman said that he "sold his minority stake to the estate" of Bill Davidson on October 31 as "part of a previous agreement with Davidson" (CRAINSDETROIT.com, 1/19). Meanwhile, Cavaliers Senior VP/Communications Tad Carper, when asked if Cavaliers Owner Dan Gilbert is interested in selling his team and pursuing the Pistons, said, "The answer is no" (CRAINSDETROIT.com, 1/19).   

    TIME TO COME TOGETHER? In Detroit, Bob Wojnowski writes the Pistons and Red Wings "need to finance and share a new arena in downtown Detroit." Having separate arenas "isn't nearly as economically feasible as it once was." Sharing a venue "seems simple, but is fraught with complications." If Bill Davidson "were still alive, this would not even be discussed." But Red Wings Owner Mike Ilitch is 80 years old and "loves big moves, and this could be a chance to seal an already-amazing legacy." But for the move to happen, "clustering all four Detroit pro teams downtown, Ilitch would have to take the aggressive lead" (DETROIT NEWS, 1/20).

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  • Preds May Be Forced To Strengthen Guarantee With Nashville

    Predators' Ownership May Have To
    Strengthen $50M Guarantee With City
    The Predators' ownership "may be forced to strengthen their $50[M] guarantee with the city because of the discovery of a financial agreement among the owners that has tougher terms than the city can guarantee," according to David Shoalts of the GLOBE & MAIL. Under the agreement, which was signed in December '07, if "one or more of the owners can no longer meet his financial obligations to the franchise and the NHL or causes a financial loss, then the other owners have to cover the obligations in a ratio of their ownership percentage in the franchise." The Predators owners also "signed two agreements with the NHL, one a financial guarantee for as much as $50[M] and the other a consent agreement, that are far more binding than the city agreement." Those contracts "give the NHL the right to be the front of the line of any creditors and the right to revoke the franchise if it decides the owners are no longer meeting their obligations." They also do "not allow any of the owners to escape financial commitments by declaring bankruptcy." Shoalts notes the city of Nashville, which owns Sommet Center through the Metro Sports Authority (MSA), is "seeking assurances from the team owners about their financial situation." That "became necessary after the news last month" that Predators Owner David Freeman had a "federal tax lien placed on his house." If Freeman "cannot settle the lien, he and the team could be found in default on the city guarantee." MSA Finance Committee Chair Rusty Lawrence said that he was "not aware" of the agreement among Predators owners, and that he "now plans to bring it to the attention of the Sports Authority committee that is negotiating with the Predators owners and add it to his list of reasons why the city's guarantee needs to be strengthened." Lawrence noted that the negotiating committee "plans to meet with the owners early next week." Their report "will be delivered to a special meeting of the finance committee" on January 28 (GLOBE & MAIL, 1/20).

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  • NFL Panthers Face Decisions On Concessions, Beer, Tickets

    Panthers Officials Expected To Make A
    Decision On Concessions In Next Few Weeks
    NFL Panthers President Danny Morrison and other team officials "face crucial issues ... between now and the start of summer training camp: to lock in ticket renewals, land new backers and put renewed sizzle into the NFL franchise's marketing blitz," according ton Erik Spanberg of the CHARLOTTE BUSINESS JOURNAL. The Panthers are "grappling with a range of economic concerns, from declining corporate hospitality sales to fans and sponsors resistant to price hikes." Team officials "within the next few weeks ... expect to make a decision on which company will handle the team's concessions," as they shift from Stadium Food & Beverage, which was "created and owned by the Panthers for the past 12 seasons." Panthers officials have narrowed the list to three -- Aramark, Levy Restaurants and Delaware North Sportservice." Spanberg writes it is "time for the Panthers to decide whether they want to remain a part of the Pepsi generation -- or have a Coke and a smile instead." Also, "not long after the Panthers settle on a soft drink, the franchise will be looking at its beer options." Miller and Bud Light "share the team's beer sponsorship in deals worth a combined $4[M] annually," but those contracts "expire after the 2010 season." The Panthers also currently lack an automotive sponsor, as Carolina Chrysler-Jeep dealers "walked away" before the '08 season, and the team is "hoping some signs of life among carmakers in recent months can drive a new deal." Meanwhile, the Panthers "suffered a 3% dip in turnstile attendance and a 10% drop in Carolinas TV viewership" during the '09 season, and Panthers Dir of Ticket Sales & Operations Phil Youtsey said that the team is "working on its sales plans and strategies for a rollout later this year." While he declined to disclose plans, it "seems likely the Panthers will focus on adding perks to lure corporate buyers back" (CHARLOTTE BUSINESS JOURNAL, 1/15 issue). 

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  • MLB Franchise Notes: Giants Likely To Surpass $100M In Payroll

    Lincecum's Contract Could Put
    Giants' Payroll Over $100M Mark
    In S.F., Ray Ratto notes the Giants are about to become a "nine-figure baseball team, and that's a whole lot more than they said they had a month ago." With Ps Tim Lincecum and Brian Wilson filing for arbitration, the Giants are "about to sail well past their stated budget of the low $90[M] level. And unless [GM] Brian Sabean is signing players with his own money, the Giants are actually ready to break the $100[M] mark for the first time." The Giants are "suddenly either spending money they don't have, spending money they do have, or are hoping to have with a sudden burst of public interest." Ratto: "No matter what the answer, this is their version of going for it" (S.F. CHRONICLE, 1/20).

    SEEING RED? D'Backs officials said that the team's one-year, $4.5M deal with 1B Adam LaRoche moves the club's payroll close to $79M, "a figure that makes a finish in the red a realistic possibility." In Phoenix, Nick Piecoro notes D'Backs Managing General Partner Ken Kendrick "throughout the off-season" said that the team "would be willing to stretch its payroll close to $80[M] in the right situation." Kendrick said that if the team "isn't in contention this season," the franchise "likely will lose money." Kendrick: "If they don't play well, we absolutely will have a loss. But we're willing to take that risk. We're not about making money. We're about winning and trying to avoid significant losses" (ARIZONA REPUBLIC, 1/20).

    INCREASED SPENDING: In West Palm Beach, Joe Capozzi reports the Marlins yesterday committed to another $8M in salaries, putting them "on track for a payroll of at least" $45M. The team yesterday agreed to one-year deals with 3B Jorge Cantu and P Leo Nunez, which puts the team at $34.7M "in contract commitments in 2010 for just 10 players." If the team does not trade 2B Dan Uggla, who agreed to a one-year, $7.8M deal Monday, the Marlins' payroll "projects to be at least" $45M. However, Capozzi writes the "increased spending isn't a direct result of last week's agreement with the league and union over the Marlins' promise to spend revenue-sharing money on player salaries" (PALM BEACH POST, 1/20).

    Mariners Reportedly About To Sign
    Hernandez To Five-Year, $78M Deal
    COST OF COMPETING: In Seattle, Steve Kelley writes the Mariners "can't afford not to keep [P] Felix Hernandez, so they are about to sign him to a five-year deal worth about $78 million." In signing Hernandez, "once again, the M's, under general manager Jack Zduriencik, are doing the right thing." They "aren't lowballing their budget and throwing up their hands at the millions it will take to keep the brightest, youngest gun in baseball." Kelley: "They're sending a message -- to the fans, to the other players in their clubhouse and to the rest of baseball -- that they are ready for the big time" (SEATTLE TIMES, 1/20).

    IN THE DARK: ESPN.com's Buster Olney reported "part of the unusual nature of the Mets' offseason has been the fact that" Mets GM Omar Minaya "has never been given a budget." As the Mets' front office has been "evaluating possible strategies, the executives haven't been able to cast these choices against the context of how much money is available." They instead are making their recommendations to COO Jeff Wilpon "on a case-by-case basis, without knowing whether" they are "yet bumping up against a financial ceiling." Olney noted Wilpon "has been the lead negotiator for the Mets this offseason, and not Omar Minaya, which has reinforced the belief in some corners of the organization that Minaya is one extended losing streak removed from being fired" (ESPN.com, 1/19).

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  • Franchise Notes

    A source said that "contrary to multiple reports and abundant speculation," the Wizards "have not considered voiding Gilbert Arenas' contract in the wake" of his felony gun plea. The source added that the Wizards have "not had any discussions or communications with Arenas in regards to voiding the deal, and haven't decided what their course of action is in the situation because the legal process must play out" (MIKEJONESSPORTS.com, 1/18).

    DIGGING OUT OF DEBT: EPL club West Ham United co-Owner David Sullivan estimated that the team's debt "could be as much as" US$179M as a "result of excessive spending on transfers and wages and borrowing against future income." Sullivan: "We are like a government of national unity in crisis." He "predicts that the next set of accounts will show a loss" of US$65-81M and "has not ruled out selling the naming rights to Upton Park." In London, Gary Jacob noted the new owners have "targeted qualifying for the Champions League within seven years, want to rent the Olympic Stadium after the 2012 London Games and pledged money for transfers this month in an attempt to avoid relegation" (TIMESONLINE.co.uk, 1/19).

    DRAWING POWER: The Texans are increasing ticket prices by an average of 6.67% next season, and in Houston, Richard Justice writes they are "raising ticket prices because they can." They have "sold out every game for eight years, and there's no reason to believe a 6.67[%] price increase is going to snap the streak." The Texans have "blown by the Astros in the hearts and minds of fans, and even though they've never been great on the field, people still care deeply" about them (HOUSTON CHRONICLE, 1/20).

    SPURRING THEM ON: In San Antonio, William Pack reported the Spurs are "creating a Silver & Black Pack," which will consist of 30 of the team's "zaniest fans as selected by audition Jan. 30 at the AT&T Center." The winners "must be able to attend the Spurs' final regular season games at the arena." Auditions "will include an interview, a Spurs trivia quiz and a showcase to demonstrate how far their support carries them." Participants "must be at least 18 and complete an application form" (SAN ANTONIO EXPRESS-NEWS, 1/19).

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