SBD/Issue 94/Franchises

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  • Leonsis' Takeover Of Wizards, Verizon Center Now In Jeopardy

    Leonsis' Attempts To Assume Full Ownership Of
    Wizards, Verizon Center Thrown Into Question
    Washington Sports & Entertainment claims that it "has the right" to put the Wizards and Verizon Center "on the open market, throwing into question attempts" by Capitals Owner Ted Leonsis to assume full ownership of the two properties, according to a front-page piece by Thomas Heath of the WASHINGTON POST. WSE President of Business Operations & CFO Peter Biche, whose organization controls 56% of the NBA team and Verizon Center, in a memo to employees Tuesday acknowledged that Leonsis "has the right to match any offer submitted" to the estate of Abe Pollin. Leonsis' Lincoln Holdings already owns the remaining 44% of the Wizards and the arena. But Biche in the memo also said that "no one has an exclusive right to negotiate a purchase" for the entities in Pollin's estate, which also include the local Ticketmaster franchise. Sources indicated that Leonsis believes his investor group "has an exclusive period to reach a deal," and Leonsis "thinks that period is still in effect." Heath notes the news will "probably complicate what has been a civil negotiations process between representatives of Leonsis" and Pollin's estate. These events "point to an unraveling of what many thought would be a smooth transition from Pollin to Leonsis." When Leonsis bought the Capitals from Pollin in '99, the two "set conditions that would create a path for Leonsis and his investors to buy the basketball team and Verizon Center upon Pollin's death." However, the two sides are "thought to be more" than $100M apart in their "respective valuations of a package" (WASHINGTON POST, 1/28). A source close to Leonsis said Lincoln Holdings is "surprised and disappointed" by Biche's e-mail. The source said of WSE, "They are forced to sell if we want to buy" (AP, 1/27).

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  • MLS Sounders To Cap Season Ticket Sales At 32,000 For '10 Season

    Sounders Owner Says 96% Of Team's Season-
    Ticket Holders Renewed After Last Year
    After setting an MLS attendance record last season with 30,897 fans per game, Sounders FC yesterday said that it "will cap season ticket sales at 32,000 for the coming year," according to Greg Johns of SEATTLEPI.com. Sounders Majority Owner Joe Roth said that 96% of the team's season-ticket holders "renewed after last year." Less than 1,000 season tickets "remain for the 2010 season," and only a "limited number of single-game tickets" will be available next season. The team "does not plan on expanding its Qwest Field seating configuration of about 35,500 used at the end of last year." The full stadium capacity of 67,000 "could be opened up for three still-to-be-announced 'international friendly matches' that are part of the season-ticket package, but regular-season games will be played using only the lower bowl plus one section of seating above the concourse." Sounders Senior VP/Business Operations Gary Wright said the current seating is a "natural fit without going into the Hawk's Nest." Johns noted the "other option would be to open up the huge expanse of seats in the upper bowl, but ticket demand doesn't warrant that at this point." Wright: "It's important to keep the atmosphere what it is. If you open up the whole bowl, you don't have that same energy and feeling because you'd have lots of empty seats." Wright said that he "expected an announcement of the international friendly matches in the next several weeks" (SEATTLEPI.com, 1/27).

    FRIENDLY COMPETITION: Wright said of the international friendlies, "We're looking at some big ones again. We feel good about it. ... But now we've got so many other games, I don't think we can fit all three of our friendlies (into the July and early August time period favored by European clubs). So I think we're going to have to take another of our windows and find a team from another part of the world than Europe to come play in October or May." In Tacoma, Don Ruiz notes the Sounders are "guaranteed at least one home game in the CONCACAF Champions League, and they are likely to host games in defense of their U.S. Open Cup title." But early round games in those competitions "will be played at Starfire Sports Stadium" in Tukwila, Washington, and are "not part of the season-ticket package" (Tacoma NEWS TRIBUNE, 1/28).

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  • Jon Daniels Says MLB Rangers' Sale Was Not A Distraction To Team

     
    MLB Rangers GM Jon Daniels yesterday said he does not think outgoing Owner Tom Hicks putting the team up for sale "affected anyone inside the clubhouse walls last year." Daniels, during a chat on ESPNDALLAS.com, said, "The players are aware of what's going on, but they really didn't see any effects, and were pretty well insulated. So I don't think it affected our play at all." Daniels added it was "mostly the same for the organization as a whole," and the idea that Rangers President Nolan Ryan was "part of the group that seemed like the most likely new ownership team probably helped." Daniels: "People on both the baseball and business sides were able to focus on their jobs, as Nolan brought a sense of continuity when a lot was unknown." Meanwhile, Daniels said under the new ownership group, the organization expects to "win, and now that we've put a plan in place to do so, we hold ourselves to ... that standard." Daniels added he feels a "tremendous obligation" to prospective Owner Chuck Greenberg "to deliver." Daniels: "He's given me and our group an opportunity to mold the franchise, spend resources against our vision. It's more pride than pressure" (ESPNDALLAS.com, 1/27).

    PRESSURE'S ON: ESPNDALLAS.com's Matt Mosley wrote Hicks "got one thing right:" his decision in '08 to hire Ryan as president and "put him in charge of all baseball decisions." Mosley: "It was a much-needed credibility infusion, and Ryan's very presence seemed to point the organization in the right direction." But Mosley wrote "no matter how much some of us loved collecting Ryan's baseball cards when we were kids, most of us have learned not to revere owners," and once a "beloved player becomes part of management, it changes our relationship with him." Mosley: "Even when Ryan became the team president for the Rangers, we still had Hicks to kick around when things backfired. ... But Hicks' departure puts Ryan directly in the line of fire" (ESPNDALLAS.com, 1/27).

    REMEMBER THE GOOD: In Dallas, Evan Grant writes if Hicks' Rangers tenure is "remembered purely for the failures, it would be revisionist history." Grant: "If you closely examine the 12-year Hicks reign, you might just conclude it to have been the most successful in the club's history on virtually every front." The Rangers "finished 10 games above .500 or better four times" under Hicks, and the club's farm system was "ranked as the best in baseball last year." The Rangers also are "more of a force in Latin America," and in Ryan and Greenberg, Hicks "seems to have found the best possible caretakers for the franchise" (DALLAS MORNING NEWS, 1/28).

    HISTORY LESSON: In Dallas, Mike Heika wrote in the "wake of the sale of the Rangers, one thing seems clear" -- Hicks' vision for running the Stars is "similar to the vision he had for the Rangers in 2003." Heika: "He will run the team on a tight budget, and that budget will be set yearly based on the team's revenue." Heika wrote he "believed for a while that the difference between the finances of Major League Baseball and the NHL would entice Hicks to spend money on the Stars for the simple reason that it makes financial sense." But the NHL has "changed since the lockout." The league is "participating in a ton of revenue sharing, so a lot of the money that a team makes in the playoffs actually goes to the NHL and is redistributed." Heika: "The financial incentive to win isn't as great as it was five years ago" (DALLASNEWS.com, 1/27).

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  • Oracle CEO Larry Ellison Confirms Interest In Buying Warriors

    Sources Indicate Ellison Unwilling To Pay
    Asking Price Of $400M For Warriors
    Oracle CEO Larry Ellison yesterday confirmed that he is "interested in buying" the Warriors from Owner Chris Cohan, according to Frank Hughes of SI.com. Ellison was asked about speculation that he will buy the Warriors during a conference to discuss Oracle's plans for its takeover of Sun Microsystems. Ellison: "I'm trying. I'm trying. Unfortunately you can't have a hostile takeover of a basketball team." But Warriors President Robert Rowell said that Ellison has "never made an offer to buy the team." NBA sources said that Cohan is "asking at least $400[M] for the team, and indications are that Ellison is not willing to pay what appears to be an inflated price given the economy and impending lockout after next season." But Ellison's latest comments indicate that he "may be looking to open dialogue with Cohan" (SI.com, 1/27). Rowell yesterday said, "I've been hearing this for years. At some point in time, the media speculation will become a reality. But right now, there's not much to this." While Cohan has given "no indication he plans to put the franchise up for sale any time soon, there's thinking that he would certainly listen if an incredible offer was made down the road" (AP, 1/27). In Oakland, Monte Poole writes, "So ends the speculation, rumor and innuendo. So begins the dreaming." It is "game on," as Ellison is "telling the world he wants to buy the team." Ellison "used 15 unambiguous words to thrust the ball into Cohan's chest." Since becoming the principal owner of the team in '95, Cohan has been a "disaster, with teams defined by failures and a franchise gripped in dysfunction." There is "no knowing what kind of owner Ellison would be, but it's impossible to imagine him being less effective than Cohan" (OAKLAND TRIBUNE, 1/28).

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  • NBA Franchise Notes: Prokhorov May Not Get Nets Until March

    Prokhorov May Not Take
    Control Of Nets Until March
    In New Jersey, Al Iannazzone reports Mikhail Prokhorov's expected takeover of the Nets from Bruce Ratner "probably won't be until the very end of the first quarter" of this year. Sources indicated that Prokhorov "may not take control" of the NBA team until March, and it is "possible it could go into the second quarter, early April, depending on when everyone and everything is cleared from the Atlantic Yards site in Brooklyn." Prokhorov also still needs approval from the NBA BOG, "which could happen next month" (Bergen RECORD, 1/28).

    THAT'S THE TICKET! The Cavaliers will become the first pro franchise to use a new dynamic ticket pricing product from Indianapolis-based pricing software developer Digonex Technologies Inc. The team next month will begin employing Digonex's Sports & Entertainment Analytical Ticketing System (SEATS), which analyzes sales data and provides price suggestions using dozens of parameters and data points, for select individual games at Quicken Loans Arena. Digonex launched SEATS in November, and the dynamic pricing product is a direct competitor to Qcue Inc., which works with the MLB Giants and Stars. "Our technology helps sports franchises stay in sync with an ever-changing marketplace and provides a fair-to-all pricing solution that benefits both sports teams and fans," said Jan Eglen, Digonex CEO (Eric Fisher, SportsBusiness Journal).

    CHECKING INTO THE GAME? In Toronto, Doug Smith reported the Raptors, NBA and Ontario government are "on the verge of allowing professional basketball to be part of the daily Pro-Line" gambling offerings. MLSE Exec VP & COO Tom Anselmi: "It's not done yet, but it will probably be done for next year, maybe this year's playoffs." Smith noted the NBA "originally ordered the province to drop NBA games from its daily offering on Pro-Line as a term of the franchise's expansion agreement with the Raptors." But Anselmi noted gambling on NBA games "happens in other provinces." When the Grizzlies left Vancouver, the NBA "went back on" B.C.'s Pro-Line game (TORONTO STAR, 1/27).

    THE KINGS & I: The Kings on Tuesday announced an "exclusive new community-based leadership" organization called Kings 100. The group of 100 Sacramento-area community leaders is working to "continue garnering support in the region" for the NBA club (SACRAMENTO BEE, 1/27).

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