SBD/August 15, 2012/Franchises

Sources: Prospective Grizzlies Owner Pera Would Sell 33% Ownership To Partners

As much as 33% of the Grizzlies "could be owned by local partners as part of prospective owner Robert Pera's bid to buy the team,” according to sources cited in a front-page piece by Kyle Veazey of the Memphis COMMERCIAL APPEAL. The sources said that in addition to local partners, the group “also could include out-of-town partners.” Pera's reps have been in Memphis “in recent weeks, meeting with dozens of business and community leaders in what has been termed a ‘listening tour.’" As part of the visits, Pera's team “has had conversations with prospective minority partners.” Sources said that in those conversations, prospective owners “have voiced two main concerns: 1) the degree of Pera's commitment to Memphis, 2) the fear of dilution of their ownership share over time.” Veazey reports it is unclear “who is being courted as potential local partners.” Currently, local Grizzlies investors include AutoZone Founder J.R. Hyde -- "with whom Pera had dinner last month" -- along with Barbara Hyde, Staley Cates, Andy Cates, Fred Jones and Elliot Perry. Sources late last month said that Pera “flew to Colorado to meet with Hyde, and that he'd been in Memphis for a visit that included a get-acquainted session with FedEx CEO Fred Smith and other FedEx leaders.” The 33% share “would be significantly more than what the current local partners hold -- some 2 percent -- and more in line with their original holding.” The "original idea" under current Grizzlies Owner Michael Heisley's majority ownership “was for locals to own 49 percent of the team.” But the locals “saw their share diluted over the years” (Memphis COMMERCIAL APPEAL, 8/15).
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