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SBD/March 11, 2013/FranchisesPrint All
NBA Commissioner David Stern on Friday said that the bid made by Penguins co-Owner Ron Burkle and 24 Hour Fitness co-Founder Mark Mastrov to buy the Kings and keep the team in Sacramento "does not measure up in dollars" to the team's tentative deal with the Seattle group, according to Bizjak, Lillis & Kasler of the SACRAMENTO BEE. Stern: "The counter bid has got very strong financial people behind it, but it is not quite there in comparison to the Seattle bid. There is a substantial variance." He suggested that the bid “falls short enough that it likely won't be considered by the NBA unless the Sacramento group increases its offer.” But Stern said that he “has been in contact” with the Sacramento group, adding that he believes the group will "increase its bid in the coming weeks.” Mastrov on Friday said, "We are going to be aggressive. ... We have a long way to go. We are going to continue to work with the NBA.” Stern said that he "has set up an April 3 meeting" in N.Y. with some league owners to "review where the bids stand," and that he will invite the mayors of Seattle and Sacramento and the two potential purchase groups. He said of the two cities both vying for the Kings, "We've never had anything like this, at least in the last 36 years that I'm aware of." Meanwhile, Stern “hinted there may be more than one bid from people interested in keeping the team in Sacramento, but he did not mention names.” He said that he told current Kings limited partner John Kehriotis “to ‘go for it,’ if Kehriotis feels he can mount a competitive bid" (SACRAMENTO BEE, 3/9).
READING BETWEEN THE LINES: Sources said that the gap between the Seattle and Sacramento bids is "substantial and well into eight figures.” But in Sacramento, Ailene Voisin wrote while Stern’s comments were “succinct and sobering, perhaps even alarming,” his mood “wasn't all doom and gloom.” Stern on several occasions "tempered his remarks with encouraging words for Sacramento and at one point praised the mayor and city leaders for their 'Herculean efforts.'" Meanwhile, in an “obvious jab at the Maloofs, Stern referred to the Mastrov/Burkle proposal as an ‘expression of intent’ and ‘a somewhat labored process set up by the Maloofs as to how we would get to an agreement with the Sacramento purchase group’" (SACRAMENTO BEE, 3/10). Stern said, "If an ownership group has decided to exit our league, it doesn't retain the ultimate right to tell us where it's going to be located" (AP, 3/9).
FIND YOURSELF A CITY TO LIVE IN: The BEE's Bizjak, Lillis & Kasler in a front-page piece write the city of Sacramento “appears to have the sympathy” of Stern, but ultimately the decision will “have little to do with sympathy.” The city “must improve its offer for the team.” Mastrov said that he “wasn't troubled by Stern's assessment.” Still, sizing up the two cities “remains difficult.” For every point “in Sacramento's favor, there's one for Seattle” (SACRAMENTO BEE, 3/11). NBCSPORTS.com’s Aaron Bruski cited sources as saying that the “TV Homes per team metric is one of the reasons small-to-mid markets like Orlando, Sacramento, and Seattle are coveted by the league.” Other teams in the city “cut into the NBA’s TV viewership in Seattle." Sources said that the "same issue mitigates the advantage the Emerald City has in terms of potential sponsors.” A source added that it “didn’t make sense for the league to pit the ownership groups against one another," as the NBA "still wants to do business with both well into the future” (NBCSPORTS.com, 3/9). ESPN’s Michael Wilbon said Stern wants the Kings' move to Seattle "to be part of his legacy,” but Sacramento Mayor Kevin Johnson is "dogged and determined” to keep the team. Wilbon: “Why didn’t Seattle close the door and close the deal on this already? Sacramento keeps in there. KJ is in there, he’s agitating. He’s holding on to that team for his city. I totally admire him.” ESPN’s Bill Simmons said Seattle is “in the driver’s seat” to get a new NBA franchise (“Kia NBA Countdown,” ESPN, 3/8).
SLEEPLESS? In Seattle, Drew DeSilver noted hedge fund manager Chris Hansen, who is leading the bid to buy the Kings and move them to Seattle, disclosed that his Valiant Capital Partners fund had “a net loss" of 7.44% in Q3 '12. Hansen in a letter to investors wrote “investing, not basketball, is and has always been” his passion (SEATTLE TIMES, 3/10).
The 49ers have “sold three-fourths of the seats” at their new Santa Clara stadium “as the team prepares to transfer a huge cash infusion to the public agency building the stadium,” according to Mike Rosenberg of the SAN JOSE MERCURY NEWS. The 49ers said that fans and corporations have bought $403M worth of seats, which is "equal to the cost spent to build the stadium so far." The team added that they are "well ahead of schedule to sell out" before the '14 opening. The most expensive seats are “already sold out -- in the suite tower, where luxury boxes cost up to $500,000, and the $80,000 club seats at midfield.” Only the “cheaper seats behind the end zones and in the corners are left.” When adding suite sales, the total new revenue from the $1.2B stadium is “believed to be” more than $800M. Legends VP/Sales & Marketing Al Guido said that "about two thirds of the remaining 60-or-so suites that ring the stadium are still available.” The team “keeps the revenue from the luxury boxes,” which is “believed to be in the range" of $400M. Guido said that overall, three out of every five sections have “sold out" since the club seats went on sale a year ago. About 14,000 clients -- mostly “fans, with some companies -- have bought 46,100 seats in the 68,500-seat stadium.” About 1,000 seats “will be left unsold for single-game sales” (SAN JOSE MERCURY NEWS, 3/10). Guido in a statement said, "The education of potential buyers has played an integral role in our early success, and our stadium preview center is the greatest asset we have had in that regard" (49ers).
MLB Rangers CEO Nolan Ryan yesterday "broke 10 days of complete silence and issued a statement saying he intends to continue to talk" to team co-Chairs Bob Simpson and Ray Davis about his role with the team following the promotions of Jon Daniels and Rick George, according to Evan Grant of the DALLAS MORNING NEWS. Ryan in the statement said, "The conversations have been productive, and we have discussed my role as CEO of the organization. We agreed these discussions will continue as we go forward." Grant writes the "uniqueness of this situation is part of what makes it so difficult to envision." In the "hierarchy of all 30 teams, there does not appear to be a structure similar to the one the Rangers have proposed." Of the other 29 MLB teams, the CEO "holds at least one other title in 19 cases." Ryan has a seat on the Rangers BOD, but Simpson and Davis "ultimately make the major financial decisions." Ryan owns a "small percentage of stock in the team and during cash calls over the last two years, he’s let the percentage shrink more." Grant: "Ideally, the Rangers would like to create a mix where Ryan and Daniels either build a consensus or agree to compromise on various decisions." The Rangers have a "unique situation" and to "make it work long-term, it will take a unique approach to decision-making" (DALLAS MORNING NEWS, 3/11). In Ft. Worth, Mac Engel wrote Ryan's statement leaves "the door wide open to Nolan staying, and leaving." Engel: "Clearly the Rangers are in full crisis, red-alert, oh-crap spin control mode." For fans of Ryan, the statement is "encouraging because it's not a giant middle finger to the franchise and a declaration of departure." But it is also "is not totally encouraging because it does not say he is going to remain with the team" (STAR-TELEGRAM.com, 3/10).
SHOULD I STAY OR SHOULD I GO? In Dallas, Peppard & Fraley wrote despite the "initial flurry of positive reports, Ryan’s future with the Rangers remained in doubt" yesterday (DALLASNEWS.com, 3/10). In Ft. Worth, Drew Davison cites sources as saying that the "optimism that Ryan will remain with the team that surfaced Saturday is beginning to erode somewhat." Sources said that Ryan "has two obligations he made months ago to fulfill: in San Antonio for the Rangers’ two exhibition games there March 29-30, and in Houston during the Rangers’ season-opening series against the Astros" (FT. WORTH STAR-TELEGRAM, 3/11). ESPN DALLAS' Jean-Jacques Taylor wrote the Rangers "can thrive without him, but they're a better organization with him -- and it has zero to do with him being a Texas icon." Ryan is a "patient boss, a man who understands hasty decisions aren't always the best." Taylor: "Heck, that's probably why he's taking his time to study his role with the Rangers" (ESPNDALLAS.com, 3/10).
BEHIND THE SCENES: The DALLAS MORNING NEWS' Grant wrote, "Forget complete clarity on roles; if everybody is on the same page in basic philosophy, the club will be better for it." It may "never be entirely clear who has final say in what baseball decisions. And it need not be." The Rangers' ownership and BOD "may have bobbled the ball in how they handled the promotions of Daniels and Rick George to presidents of their respective divisions (baseball and business) in that it required removing a title from Ryan’s desk plate." The front-office moves were "designed to set the organization up for long-term stability by establishing a line of succession." There is now "plenty of room for promotions beneath Daniels/George and Ryan to retain bright young baseball and business minds." Ryan is 66, and the "fact he is running the franchise for a sixth year is, quite frankly, a little bit of a surprise" (DALLAS MORNING NEWS, 3/10). In Ft. Worth, Randy Galloway cited a source as saying that if there is "anyone who could reach an agreement with Ryan, it would be Simpson, the Fort Worth resident who is considered Ryan’s No. 1 ally in the ownership group" (FT. WORTH STAR TELEGRAM, 3/9). Meanwhile, in Boston, Nick Cafardo wrote, "There is always a Houston rumor associated with Ryan, but that seems to make even less sense, given the direction of Astros management toward statistic-driven decisions" (BOSTON GLOBE, 3/10).
The Magic's home attendance this season has "surpassed many observers' predictions, but it's not as strong as it had been during the team's first two seasons at Amway Center," according to Josh Robbins of the ORLANDO SENTINEL. Through their first 32 home games this season, the Magic "averaged an announced crowd of 17,601 people per game, which ranked them 14th out of the league's 30 teams and placed them above the league average by 411." The Magic this year have often seen "small, but recurrent, patches of empty seats." But this is "life for the Magic in Year 1 A.D. -- or After Dwight -- the team's first season since it traded" Lakers C Dwight Howard. City records show that an average of 13,455 people have "attended Magic home games this season," down 15% from last season and down 25% from the team's '10-11 opening season at Amway Center. But the Magic are "doing better at the turnstile than many teams in the NBA." The team entered this season with "about 13,000 season tickets sold, but many of those sales occurred before the Howard trade on Aug. 10." The Magic are still "in the midst" of the season-ticket renewal process for next season. Magic CEO Alex Martins said that season-ticket holders are "renewing at a rate similar to this point last year." Additionally, the team has "struggled to draw viewers for its Fox Sports Florida broadcasts." Nielsen ratings show that the RSN has "drawn an average of 14,784 households per game," which is a decrease of about 54% from "last year's broadcasts on Fox Sports Florida and Sun Sports." Martins said, "In my opinion, and most data reflects this, that of all the components of our business, television ratings are most affected by wins and losses." Meanwhile, he added that the team has "set a new franchise single-season record for sponsorship revenue" (ORLANDO SENTINEL, 3/10).
The Cubs are "teaming up with Northwestern's Kellogg School of Management to conduct a survey involving kids' experiences at Wrigley Field, asking selected fans to help provide the 'right opportunities for your kids to connect with the team and grow as the next generation' of fans," according to Paul Sullivan of the CHICAGO TRIBUNE. Cubs Senior Dir of Marketing Alison Miller said, "We've done a couple things just with trying to get better research on our fans, and just being smarter about what our fans want. We've done a lot of focus groups in the last couple of months." Sullivan notes fans were asked about kid-friendly topics such as "batting cages and radar gun zones, kids apps for smartphones and tablets, a kids section, a new Cubs song and 'interaction with a mascot.'" Sullivan wrote, "A mascot at Wrigley Field? In the ballpark that still boos the Wave?" The Cubs are "one of only a few teams that eschew the marketing ploy, joining traditionalists such as the Yankees, Dodgers and Angels" (CHICAGO TRIBUNE, 3/10). Meanwhile, in Chicago, Floyd Sullivan conducted an informal survey to gauge Cubs fans' reaction to the team's new "Committed" marketing campaign. Sullivan wrote it "hasn't gone over too well so far." One respondent said, "Makes me think of a nut house." Another added, "It sounds like they haven't been 'committed' up until now." The press "hasn't been too kind to the campaign theme either." Sullivan: "I've been surfing the web for opinions and have not found a positive review." The word committed "isn't even a baseball word." The Cubs on Friday held their launch event for single-game ticket sales, and there "couldn't have been more than a couple hundred fans there at most" (CHICAGONOW.com, 3/9).
Indians Chair & CEO Paul Dolan said last season's "cataclysmic collapse" in which the team finished 68-94 was "a shock we needed," according to Terry Pluto of the Cleveland PLAIN DEALER. Dolan said the '12 season was "the worst" he has endured in the 14 years his family has owned the franchise, and it "made it clear that we were not going in the right direction." He said of the team spending $116M on player payroll this offseason, "We heard it, we felt it. We knew we had to do something. The cycle was heading to the bottom and going to be at the bottom for some time. We couldn't wait another five years for the next wave of minor leaguers to come." He added the possibility of changing the top of the front office -- specifically President Mark Shapiro and GM Chris Antonetti -- was "never on the table." Dolan: "We have a high degree of confidence in them." Pluto noted the Indians last season drew "only 1,603,596 fans -- the second-lowest total since the team moved to Progressive Field." The team's season-ticket base "was barely above 5,000 not long after the season," but it is now "approaching 7,000." Ticket sales have "risen" since the Indians' offseason moves, "especially" after the signing of CF Michael Bourn. But Dolan said, "We have no expectations of covering the cost for this year. We will lose money." However, Dolan "views it as a 'long-term investment' in the franchise, something that had to be done." Meanwhile, he said the sale of SportsTime Ohio to FS Ohio has not been "reported correctly." He added that the deal is "paid out over a number of years." Dolan said, "The television money wasn't the only reason we made these moves, but it helped" (Cleveland PLAIN DEALER, 3/10).
The NFLPA is "willing to take joint legal action" with the Redskins against the NFL, "aimed at retrieving some of the salary cap space that the team lost last year," according to sources cited by Maske & Jones of the WASHINGTON POST. But the sources added that the union and the Redskins "have not discussed such an effort." A source said that the Redskins "are not interested in such joint legal action because they do not support the union’s allegation that the league and teams improperly colluded to restrict players’ salaries in the sport’s season without a salary cap" in '10. The source added that legal action by the team "without the union, remains a possibility." The unrestricted free agent market opens at 4:00pm ET tomorrow, and the Redskins "must be under the salary cap by then." A source said that the NFLPA "would continue to welcome a joint legal effort with the Redskins on the salary cap case." The source added that there had been "no dialogue between the union and the team on the subject but the Redskins still could join the union’s appeal of its collusion case against the league and teams." A source confirmed that the union "would be interested in joint legal action with the team but said the Redskins haven’t given that serious consideration because they 'don’t think there was collusion'" (WASHINGTONPOST.com, 3/9).
WHAT'S IN A NAME? In DC, Mike Wise writes Redskins Owner Dan Snyder should be "proactive before the courts" regarding the team's controversial nickname, before NFL Commissioner Roger Goodell "takes it out" of his hands." Snyder should act "before the National Congress of American Indians aligns with another powerful political minority lobby to launch a boycott" of the team's sponsors and "starts taking money out" of his pocket. Wise writes if he were in Snyder's position, "I name them the Washington Warriors. I do away with the spears, the logo and all native peoples' imagery. I honorably retire the old name in a ceremony to include tribal chiefs and I dedicate the new name to the Wounded Warriors and every soldier who has served our country." With momentum for change "growing, the owner will continue to come across as a petty, little man on the wrong side of history" (WASHINGTON POST, 3/11).