SBD/May 15, 2013/Franchises

NBA Kings Owner Committed To Seattle, But Does Not Rule Out Sacramento Sale

George Maloof said he has two deals in place with a Seattle ownership group
Kings co-Owner George Maloof yesterday said that his family “hasn't ruled Sacramento out” in the battle to purchase the team but “remains committed to selling the Kings to a group in Seattle offering a record price for an NBA franchise,” according to Lillis, Bizjak & Kasler of the SACRAMENTO BEE. Maloof was “circumspect about whether his family would seriously consider the Sacramento bid.” NBA owners at today's BOG meeting in Dallas are expected to vote on the bid from the Seattle-based group led by Chris Hansen and Steve Ballmer, and Maloof said that he is “hoping to get league approval for one of his two deals” with the group. Maloof: "Nothing against the Sacramento group, but they have a backup offer, and we have a binding agreement with Chris. That is just the way the deal progressed. We have a backup from Vivek [Ranadive], but we're being true to the deal with Chris." Lillis, Bizjak & Kasler report Maloof “pointed to the price difference between the Sacramento and Seattle bids as a significant issue.” Hansen and Ballmer's offer of $406M for the 65% share of the team held by the Maloofs and their partner, Robert Hernreich, values the team at $625M. Ranadive's group has offered $341M and has placed 50% of his offer into an escrow account. Maloof said that Sacramento would have “nothing to fear from a ‘backup plan’ in which Hansen and Ballmer would buy 20 percent of the Kings and commit to building an arena in downtown Sacramento.” Maloof: "Our intention would be to try to do an arena, for the ninth time. We've never not worked in good faith." He “insisted that Hansen and Ballmer ... would be good partners in the effort to build an arena at Downtown Plaza.” Sacramento Mayor Kevin Johnson said, "That's something that does a disservice to the NBA if you're just going to sell to the highest bidder. What would that tell every other small- or medium-sized market? That you always have to worry about your franchises” (SACRAMENTO BEE, 5/15).

RATTLING THE CAGE: NBCSPORTS.com’s Aaron Bruski cited sources as saying that Ballmer has “taken on a larger role in decision-making for the Seattle ownership group.” Sources said that “the same bravado he has employed with Microsoft is turning heads” at the NBA, and “not in a good way.” Sources said that the “recent power plays made by Seattle and the Maloof family have ‘started to weigh on the NBA to the point where any Ballmer-led proposal now or in the future could fall on deaf ears if he doesn’t change course.’” A source said that if the Seattle group continues to “pursue a scorched earth policy with the Sacramento marketplace, they would jeopardize the city’s ability to secure an NBA team down the road should an opportunity present itself” (NBCSPORTS.com, 5/14).

SEATTLE SLIPPING AWAY? In Seattle, Danny Westneat writes if the NBA today votes against selling the Kings to the Seattle group, “Don’t count out the possibility that whatever political momentum there was for building an arena and bringing back the Sonics might dry up and blow away.” City council member Tim Burgess said, “If they say ‘no,’ there is going to be some energy that dissipates around here, I’m sure of that.” City council member Tom Rasmussen said, “I’m not sold on the idea of an arena yet.” Rasmussen added that he is “opposed to the idea of allowing an L.A. Live entertainment complex” in the Sodo area of the city. Burgess said if Seattle loses today’s vote, “I’m honestly not sure what will happen to the council’s support. We put together a pretty strong coalition. To be told ‘no,’ though, it would be quite a blow” (SEATTLE TIMES, 5/15).

KINGS' COURT: The BEE’s Lillis, Bizjak & Kasler report three city residents yesterday filed a lawsuit in Sacramento Superior Court “alleging the city has broken the law on several fronts” in its $448M downtown arena deal. The suit “contends the city fraudulently under-valued the size of the subsidy it is providing developers as part of a tentative deal to build a sports and entertainment arena in Downtown Plaza.” The plaintiffs allege the city "concealed or suppressed material facts" and Johnson and City Manager John Shirey "failed to disclose in the Term Sheet ... that they had privately agreed with the Sacramento Investor Group to subsidize its purchase of the Kings franchise." The group led by Ranadive “signed a deal in February with the city to partner in building an arena” to keep the Kings in the city. The lawsuit alleges that this public-private partnership with a group of investors “amounts to an illegal give-away of public funds” (SACRAMENTO BEE, 5/15).
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