SBD/Issue 181/FranchisesPrint All
Karmanos Estimates New Investors Could
Infuse Additional $10-12M Into Team
Hurricanes Owner Peter Karmanos yesterday said that there is an "'excellent possibility' that he can find a local investor or group of buyers" for part of the team and that he "wants to make the sale in the next two or three months," according to Chip Alexander of the Raleigh NEWS & OBSERVER. Karmanos: "We're in the process of talking to a lot of deep-pocket people. I have an awful lot of friends outside the community that have expressed interest. I really, really feel strongly that I want local ownership." Karmanos said that local "could mean someone from North Carolina or South Carolina, not necessarily" the Raleigh area. He added that bringing in local investors could infuse $10-12M "in extra revenue to the team, through added advertising and ticket sales." Karmanos noted that "being a minority owner in a pro sports team is a 'hard thing,' but said he'd like to find someone to buy a 'large chunk' of the team, then syndicate a number of shares to others interested in putting in" $5M or $10M each. Karmanos said that the team "lost 'a lot of money' this past season as their overall attendance dipped and they failed to reach the Stanley Cup playoffs," though he said that he was "under no financial or legal pressure to sell the 49-percent stake in the team owned by his former business partner, the late Thomas Thewes." Alexander notes Karmanos yesterday "wouldn't completely rule out selling the team, lock, stock and arena lease, but he said it would take an offer so high it would bowl him over," and he also "stressed that regardless of the buyer or sale, the team would not be moved." Karmanos noted that the team "has a lease with the Centennial Authority that runs through 2024, receives $4 million in naming rights each year and has invested" $40M in cash at RBC Center. Karmanos also said that NHL owners "would not approve a relocation" (Raleigh NEWS & OBSERVER, 6/3).
ON-ICE IMPACT: In Raleigh, Luke DeCock writes even if the Hurricanes are "here for good, it's fair to ask how good the team will be." The sales prospectus prepared by investment bank Allen & Co. "touts a reduction in expenses by as much as $15 million as a step toward profitability," and Karmanos yesterday confirmed that "that kind of savings could come only from cutting player salaries." DeCock writes the "pressure to make the money-losing franchise as attractive a purchase as possible may consign it to payroll purgatory at the bottom of the NHL's salary range." The Hurricanes' cap figure was about $54.5M this season, and with the cap minimum for next season expected to be $40.8M, the team already has "about $41.7 million committed to 17 players." DeCock writes the Hurricanes' "playoff runs gave the team the strength in this market it has today," so it "would be a shame if making the Hurricanes more attractive on paper made them less attractive on ice" (Raleigh NEWS & OBSERVER, 6/3).
Jaguars Have 4,000-5,000 Unsold
Premium Seats For Upcoming Season
The Jaguars, "who put most of their emphasis on selling non-premium seats to lift the TV blackouts, are now turning their attention to premium seats," according to Vito Stellino of the FLORIDA TIMES-UNION. The team, which has "between 4,000 and 5,000 unsold premium seats," will notify club seat holders next week that for "every two tickets they own, they can buy another one at half price." Sixty percent of the Jaguars' ticket revenue "comes from their 12,000 premium seats," and Jaguars Senior VP/Sales & Marketing Macky Weaver said that those seats "are not only important to the revenue line but to the team's image." Weaver: "Those seats are in the center of the field, so the camera angles don't look good if they're empty." The Jaguars need to sell "slightly more than 50,000 non-premium seats to lift TV blackouts," and Weaver indicated that there are "about 12,250 non-premium seats" still available for next season. He noted that June "tends to be a slow month for sales, so the Jaguars are focusing on setting up meetings for all the companies [they] haven't reached out to yet." Stellino notes the Jaguars also are "continuing their series of Team Teal events this month" (FLORIDA TIMES-UNION, 6/3).
Nationals' Newfound Success This Season
Helping To Bring More Baseball Fans To DC
In DC, Tom Boswell writes under the header, "Nationals' Progress Is Making Struggling Orioles Easy To Forget." Since the Nationals came to DC in '05, "they've wrestled with the O's for undecided voters, especially in wealthy suburbs in Maryland between the two ballparks." But this season has "finally done the trick." Nationals President Stan Kasten: "We don't pay attention to the breakdown of fans. ... The demographics of the region say the big dog in the market will be the Nats. But, separately, both towns are big enough to thrive" (WASHINGTON POST, 6/3). In Baltimore, Kevin Cowherd notes Orioles fans "might be more angry and disillusioned than at any other time in the 56-year history of this once-proud franchise," but still "not one word from the principal owner." Is Peter Angelos "mad as hell and not going to take it anymore?" Cowherd: "Who knows?" (Baltimore SUN, 6/3).
VOTER FRAUD? In West Palm Beach, Greg Stoda notes the Marlins are "giving away tickets" to fans who cast 200 All-Star votes for all Marlins position players, which "makes a mockery of what baseball has deemed more than an exhibition by making the winners' reward so important." Stoda: "That the Marlins are selling tickets after the fact for the Roy Halladay perfect game is strictly business. ... The more annoying plan put in place by the Marlins is one aimed at benefitting their players" (PALM BEACH POST, 6/3). Meanwhile, ESPN's Michael Wilbon said of the Marlins selling tickets to Halladay's perfect game, "The Florida Marlins can't get people to come to games, so management found a way to make money off fans not coming to games. ... It just is so cheesy. Baseball ought to stop it" ("PTI," ESPN, 6/2).
THREE'S COMPANY: In San Diego, Bill Center notes the Padres' plan to start more midweek home games at 3:35pm PT "might not be working out as hoped." The team thought that "workers wanting to attend the games wouldn’t need to miss a half-day of work," while parents could "bring children after school." But the first four 3:35pm starts have "attracted just 67,725 spectators -- an average of 16,931." Padres President & COO Tom Garfinkel: "The feedback from the fans on the 3:30 starts has been overwhelmingly positive and we’re happy with the change" (SAN DIEGO UNION-TRIBUNE, 6/3).
REDUCE, REUSE, RECYCLE: Yankees President Randy Levine "urged legislators yesterday to hold off any restrictions on paperless tickets until the technology has a chance to develop." In N.Y., Glenn Blain notes New York state lawmakers are "examining the role of paperless tickets as part of a new ticket-scalping law." Paperless tickets "require buyers to make purchases with credit cards and then swipe the card at the venue for entry," and opponents of the tickets claim that "such tickets are difficult to pass on to a friend or family member" (N.Y. DAILY NEWS, 6/3).
The Pistons yesterday announced that Citi Private Bank Sports Authority, a Citigroup subsidiary, "has been hired to broker the sale of the Pistons and Palace Sports & Entertainment." The Pistons said Citi Private Bank Sports Authority has been in contact with a "number of interested parties" (DETROIT FREE PRESS, 6/3). PSE Owner Karen Davidson in January said that she "wants to sell" the Pistons, and PSE President & CEO Alan Ostfield last month said that the "intent is to sell everything together, not as pieces" (CRAINSDETROIT.com, 6/2).
END OF THE LINE: In London, Gordon Tynan reports the Red Knights investment group's "dreams of rescuing Manchester United from the grips of the Glazer family have come to a dead end." It had been "expected that the Red Knights group would launch a formal bid for the Old Trafford club at some point before the World Cup." But the Glazer family last week said that it has "no intention of selling the club," and previous claims that the Glazers already rejected a US$2.2B bid from a Middle Eastern consortium "seem to have led to a belief among the Red Knights that there is little point making a substantially lower offer" (London INDEPENDENT, 6/3).
Spurs Sports & Entertainment
Pleased With WNBA Ties
SHINING STARS: Spurs Sports & Entertainment President of Business Operations Rick Pych said that the company is "impressed by the WNBA's growth and has no plans to sever its ties with the league" through its ownership of the Silver Stars. The WNBA in '02 had 16 teams, "all of them controlled by NBA owners," but SS&E now is "one of only five NBA organizations that still owns a franchise." Pych: "We believe in the product. Women's basketball is getting better and better. We're glad we have the WNBA." The Silver Stars have drawn an average of 6,872 fans per game through four home games this season at AT&T Center, down from an average of 7,526 fans per home game last season. But Pych said, "The prospects for this season, on and off the court, really look good" (SAN ANTONIO BUSINESS JOURNAL, 5/28 issue).
FANS' CHOICE: In Cleveland, Bill Lubinger reports Cleveland Browns Stadium "becomes an open house Saturday, June 12, from 10 a.m. to 2 p.m., for a 'select-a-seat' event." The number of Browns season-ticket holders at the 72,300-seat stadium "slipped to about 55,000 last season from 60,000 the year before." Browns Senior VP/Business Development Jim Ross said that "many fans are surprised to learn that season tickets are even available." Lubinger notes the "impression has been that the stadium is sold out, because when the Browns returned in 1999, it was" (Cleveland PLAIN DEALER, 6/3).