SBD/Issue 124/Franchises

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  • MLB Rangers Sale At Impasse, Unlikely To Be Done By Opening Day

     

    Talks between the MLB Rangers and the team's creditors are at an impasse, sources said, all but ending any chance of the sale of the team closing by Opening Day. The owner of the Rangers, Hicks Sports Group, defaulted on $525M of debt last March, and agreed to sell the team to a group led by Chuck Greenberg two months ago. But creditors have been balking at the terms of the deal because of the $570M purchase price, only $230M of which is pledged to the lenders. The creditors, who must approve the sale, and MLB, which is acting as an intermediary between Hicks and his lenders, held a conference call last Friday that went very poorly, the sources said. The creditors are seeking a minimum $300M of the proceeds. “They have been at an impasse for weeks if not longer,” one source said. “Baseball has been deluding itself. No idea how long it can go.” MLB declined to comment. How much longer the situation can drag on is unclear, with one source saying in a few weeks the team could be forced into bankruptcy protection. That could be through a filing in Texas by the team, or perhaps an involuntary filing by the creditors. Greenberg's spokesperson, Kevin Sullivan, had no further comment on the most recent developments. A spokesperson for Hicks had no immediate comment. Hicks Sports Group also owns the Stars, who are also for sale (Daniel Kaplan, SportsBusiness Journal).

    DOWNPLAYING CONCERNS: Greenberg said the sale process is "going smoothly." Greenberg: "It's obviously a very complicated transaction. Any deal of any size there are always complexities and matters that have to be solved right up to the moment of being done. So far, nothing remarkable has happened or failed to happen." Greenberg added the closing day of any deal is "always somewhat uncertain, because you can't legislate when exactly all of the pieces are going to fall into place and all you can do is to keep pushing along a timetable that allows you to achieve your objective." Greenberg: "Is everything done today where we can close tomorrow? No. But is everything moving on a pace that needs to in order to close on April 1? Yes. We think we will get there." Greenberg added of reports of problems with the sale, "I think there are some folks out there that have a little bit of self-interest in portraying gloom and doom, none of whom are principals in the deal, by the way." Greenberg said if the sale is not complete by Opening Day, it "doesn't mean there are problems and doesn't mean that the (hand-wringing) was ever correct." Greenberg: "It just means that sometimes deals take longer than you originally anticipate. But it's no reason for alarm on anyone's part, and we're expecting to close on April 1" (FT. WORTH STAR-TELEGRAM, 3/11).

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  • Bettman Says Coyotes Sale To Ice Edge Is Still Work In Progress

    Bettman Still Hopes, Expects There To Be
    New Ownership For Coyotes In Phoenix

    NHL Commissioner Gary Bettman yesterday said the sale of the Coyotes to Ice Edge Holdings is "still a work in progress." Bettman: "We're not yet at a point where I have to declare a hard and fast deadline. Our hope and our expectation is there'll be new ownership in Phoenix for the Coyotes." Bettman noted the NHL has given Coyotes GM Don Maloney a budget, and league officials are "not micromanaging what goes on there day-to-day." Bettman: "The fact that they were able to increase payroll at the trading deadline actually caused some consternation among clubs. None of the other clubs have written a check to subsidize this club. It is going to be self-sufficient. The league will come out of this right-side up" ("NHL Live," NHL Network, 3/10). The Coyotes currently are in fourth place in the Western Conference, and in Toronto, Damien Cox writes the team "has an excellent shot at making the playoffs for the first time since 2002 and possibly at even winning its first playoff series for the first time since moving south from Winnipeg in 1996." But "all these good vibes aside, it sure doesn't mean the trouble is over for the NHL in Arizona," or that the Coyotes "will stay put beyond the end of this season." The team is "still hemorrhaging money, albeit down to about $20[M] this season from upwards of $35[M] last year," and a "good chunk of that is due to the departure of Wayne Gretzky, who was drawing about" $8M a season in salary. There is "still no significant season ticket base," and the last four home games drew crowds of 10,385, 12,426, 14,965 and 15,883 at 17,800-seat Jobing.com Arena. The absence of a deal with Ice Edge "has fuelled speculation" that the group "doesn't have the necessary financial backing," and if there is "no deal by June, the NHL will have to look at other options which will certainly include relocating the team." Cox writes it "might make sense for Ice Edge to delay a final sale as long as possible to avoid having to begin paying the bills and funding the losses," but the "happy story on the ice won't stop the Coyotes from moving after this season if Ice Edge can't close the deal and another owner fails to step forward" (TORONTO STAR, 3/11).

    IS LAWSUIT WORTH IT? The GLOBE & MAIL's Stephen Brunt notes the NHL is suing former Coyotes Owner Jerry Moyes "for allegedly breaking side deals in which he pledged not to take the team into bankruptcy, and not to relocate it or sell it to anyone who would." The league "probably ... will get back a tiny fraction of the dough it has frittered away buying the team out of bankruptcy and operating it at a considerable loss this season." But in the process, the "spotlight will once again be turned on the smoking crater that is hockey in Phoenix, and by extension on the other struggling remnants of the U.S. Sunbelt strategy." Brunt: "Everyone will be reminded once again that while Moyes was not the shrewdest operator in the world, he did blow a considerable amount of his personal fortune on a hopeless cause and was about to be thrown under the bus by his partners before fleeing for the sanctuary of the courts" (GLOBE & MAIL, 3/11).

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  • Red Bulls Working To Build Season-Ticket Base At New Stadium

    Red Bulls Officially Open New 25,189-Seat
    Red Bull Arena On March 20

    MLS Red Bulls Managing Dir Erik Stover said that he "expects to have about 8,000 season-ticket holders by the end of the month" when the team opens its new 25,189-seat Red Bull Arena, according to John Brennan of the Bergen RECORD. The Red Bulls are scheduled to host Brazilian club Santos FC on March 20, followed by their MLS opener against the Fire on March 27. Stover "hopes that both of those games will be sellouts, and that attendance will average at least 18,000 fans this season." That is "about twice as many fans as were showing up down the stretch last season, when the Red Bulls fielded the league’s worst team while playing in comparatively cavernous 80,000-seat Giants Stadium." The sections surrounding the new stadium's 750 premium seats "already have sold out for the season at $35 to $45 per game." But Stover noted that the market "has been less vibrant for the $200-per-game premium seats on one midfield side" of the venue. Stover noted that the team "will begin selling some club seats on a per-game basis." He said, "Club seats are a little taboo for some people who are scared of this (economic) market right now." The number of luxury suites "has been reduced to 30 from 66," and Stover said that "17 of those have sold at a price of $65,000 to $75,000." Brennan notes season-ticket holders "with the most seniority gained the option to pay $100 for access to the upscale, 225-seat Red Bull Pub." Luxury suite members "get free food and beverage -- including alcohol" (Bergen RECORD, 3/11).

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  • WNBA Shock President Hopes Jones Can Build Franchise's Intrigue

    Swetoha (l) Hopes Jones (c) Can Help
    The Shock Both On And Off The Court

    WNBA Tulsa Shock President Steve Swetoha stressed the team’s decision to sign former Olympic sprinter Marion Jones was driven by her potential ability to help the franchise on the court, but he also expressed optimism that Jones can help the franchise off the court as well. The Shock are in their first year in Tulsa after having relocated from Detroit, and Swetoha felt the signing of an athlete as well known as Jones will help get people “intrigued” about the team and will bring credibility to the franchise. Swetoha: “There’s going to be a lot of curiosity that we anticipate.” He said the reaction among fans could be, "Wow, I want to now decide if I want to go out and check her out, to see if she has the athleticism everyone talked out about when we signed her.” Jones won five medals in the '00 Sydney Games before being stripped of them after admitting to using performance-enhancing drugs and she was a starter on the '94 North Carolina women's basketball team that won the national championship. Swetoha acknowledged the franchise has not yet made a decision on how it will market the team entering the season, but noted that he was hopeful to get Jones involved in marketing and sales opportunities. “She could be a good resource for us,” he said. Jones certainly has a checkered past after admitting to the PED use and serving time in prison for lying to prosecutors. But Swetoha said the initial reaction to the signing of Jones has been “extremely, extremely positive,” as the team has received “many positive responses, whether it be on Twitter, or Facebook.” Swetoha: “We recognize what she has done. People make mistakes, and you’re held accountable for those mistakes. … There’s always going to be naysayers out there. But it‘s how you utilize that and make it positive.”

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  • T'Wolves Lower Ticket Prices In Effort To Re-Energize Fan Base

    The T'Wolves are "now officially working the cheap tickets angle hard," according to Henry Abbott of TRUEHOOP. The team recently launched its "Run with the Pack" ticket sales and renewal campaign for the '10-11 season, which includes "lower bowl season tickets" for $10 per game. Also, during the month of March, season tickets are "as much as half off." The T'Wolves said that the team in the first week of the campaign "sold 300 new full season tickets during the record-setting week, while also renewing 30% of its current season ticket holders." At the same point last year, the team "had only renewed 1.5% of its season ticket holders." T'Wolves President of Basketball Operations David Kahn: "We want to start to re-energize the fan base next year as we start, we hope, a climb. It'll be easier to make that climb to the top with a very full, vibrant, loud building. This was an opportunity for us to start to reconnect, and to rebuild the fan base which at one point was one of the most rabid in the League." Kahn was asked if the decision to sell tickets "so cheaply" points to the "ongoing issues between large and small markets." He said, "I don't want to say anything in defiance of the League's wishes that we stay quiet on collective bargaining." But he added, "There should be a more robust revenue-sharing program out of this agreement." Kahn: "Having worked at Indiana for nine years, and now here, there's no question that the difference in broadcast markets has an impact on your revenues. ... New York, L.A., Chicago, the Bay Area, they're in the top ten, and especially those first three, have the opportunity to drive revenues that simply don't exist for the rest of us. ... I'm hopeful that the end result here is that the pricing decrease here will be made up with a fuller building and more buyers, and a better atmosphere for our team and our fans." Kahn said the "best thing" for the T'Wolves is "for people to be talking" about the team. Kahn: "This is one of those cases where you can't be anything but pleased if people are buying the tickets. And the more the merrier" (ESPN.com, 3/9).

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  • Senate Hopeful Removes Logo Similar To Blue Jackets' Crest

    Delphine Pulls Logo From Web Site After
    Learning Similarity To Blue Jackets' Mark

    Oregon politician Marc Delphine has removed his U.S. Senate campaign logo from his official Web site after learning that it "looks awfully similar" to the Blue Jackets' logo, according to Brad Schmidt of the Portland OREGONIAN. The similarity of the two logos "caught the attention of the Blue Jackets" and NHL officials yesterday when the "revelation occurred" on the Internet. Delphine, a Libertarian, then removed the logo from Web-based campaign materials. He said that he "still had not seen the Blue Jackets' logo and characterized it as an 'unintentional mistake' that was quickly corrected." Delphine later acknowledged that the logos were similar and then "blamed the mistake on a volunteer." Delphine said, "It's not the same logo. There's definitely some differences to it. But it's similar enough." NHL Senior VP/Public Affairs Bernadette Mansur said that "cease-and-desist orders from lawyers weren't necessary" because Delphine's logo "has disappeared." Mansur added, "I don't think there was any question that it looked close enough to be a potential legal issue" (Portland OREGONIAN, 3/11). YAHOO SPORTS' Greg Wyshynski reported the Blue Jackets PR staff was "alerted by fans over Twitter of the trademark infringement, and passed the matter along to their legal department and then to the NHL." Delphine said of complaints about the similarity, "They were all like, 'What are you doing with their logo?' and I was like, 'I didn't make the logo!' and we pulled it immediately. I'm not interested in any kind of infringement. We don't even need a logo." He noted that a volunteer "created the logo and donated it to the campaign"(SPORTS.YAHOO.com, 3/10).

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  • Franchise Notes

    Latest Sexual Assault Allegation Is The Second
    In Eight Months Against Roethlisberger

    NFL Network's Jason La Canfora reported the allegations of sexual assault around Steelers QB Ben Roethlisberger are “being taken very seriously” within the Steelers organization. La Canfora: “The Rooneys are dismayed, they're a little bit hurt that this took place. Regardless of culpability, there're people in that building who feel like if there's another incident along these lines … in the future it could be the end of his career in Pittsburgh." There is a "level of embarrassment" among the franchise, as this is the second allegation of sexual assault involving Roethlisberger in the last eight months ("NFL Total Access," NFL Network, 3/10).

    SLOW TO COME ONBOARD: In Milwaukee, Don Walker noted Bucks fans have been "slow to embrace one of the hottest teams" in the NBA. The Bucks sold tickets to Tuesday night's game against the Celtics at less than half the face value price, but there were "plenty of empty seats in the upper bowl" at the 18,717-seat Bradley Center and the game drew a crowd of just 14,316. Bucks VP/Business Operations John Steinmiller said that the team's "sales force is working to bring fans in to the Bradley Center for the rest of the season." The Bucks rank 23rd in the NBA in attendance, and Steinmiller said that they have "gone to the Internet to stay in touch with fans and keep them updated on upcoming promotions" (JSONLINE.com, 3/10).

    NOT IN THE STARS: ESPN DALLAS' Calvin Watkins noted the Cowboys "haven't signed or invited any players" to visit this offseason, indicating that team Owner Jerry Jones might be "showing restraint because he has one of the highest payrolls in the NFL." The team already has $124.3M committed to players for next season, tops in the league, and Jones said, "The real world is the Dallas Cowboys have a budget. I'm not known for following budgets, but we do have a budget because I have to look at all kinds of consequences over the next several years. I have to look at that" (ESPNDALLAS.com, 3/10).

    FOR ONE DAY ONLY: The Red Sox yesterday signed Nomar Garciaparra to a one-day contract so he could retire as a member of the team, and in Boston, gossip columnists Fee & Raposa report the deal "had to be delayed" because Red Sox President & CEO Larry Lucchino "wasn't totally on board with the plan." The retirement announcement was "supposed to come at the very beginning of Spring Training." But a source said, "Larry didn't want to do it. He had to be convinced, and eventually John Henry just told him to man up." Red Sox VP/Public Affairs Susan Goodenow insisted that there is "no truth" to the report (BOSTON HERALD, 3/11).

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