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Price for St. Louis Rams slips below $800 million mark
Published January 18, 2010
The price the St. Louis Rams’ co-owners would accept for the team has dropped into the mid- to high $700 million range, according to football and financial sources, underscoring the challenges even NFL teams have in finding buyers in this economy.
Chip Rosenbloom and Lucia Rodriguez, who inherited the club from their late mother, Georgia Frontiere, in 2008, hired Goldman Sachs in June. Goldman initially priced the team at $900 million, but the price quickly dropped to about $850 million, financial sources said.
In October, when controversy emerged around talk-show host Rush Limbaugh being part of a group looking at buying the team, Rams President John Shaw told owners at a meeting in Boston that a decision on the club’s future ownership would be made by the end of the year. That comment was widely interpreted as meaning by Dec. 31, 2009, but a source said Shaw meant by the end of the football year, which is defined as the end of February. That means a deal could still occur in the next six weeks, though because it is a self-imposed deadline, it’s also possible the owners could opt for a deal that comes in after the targeted date.
Several factors are contributing to the falling price. Beyond the economy and the team’s poor play (3-29 over the past two seasons), Stan Kroenke’s 40 percent ownership of the club and his right of first refusal for majority control is an issue.
Kroenke, as owner of the Denver Nuggets and Colorado Avalanche, is prohibited by NFL cross-ownership rules from owning a club outside of the marketplace of those two teams. So while a buyer likely does not have to worry about Kroenke swooping in and buying the Rams, that buyer does need to know if he is selling his shares. If he’s not, the sources said, any buyer will want to know what kind of voice he would want to have with the club under its new lead ownership.
Some finance sources say buyers worry about inheriting Kroenke with the club and then being faced with selling the team with the same problem for another buyer.
Kroenke could not be reached for comment.
Rodriguez and Rosenbloom are believed to be facing a sizable estate-tax bill in the next few years, but it’s unclear if they have to sell the team to meet that obligation.
The Rams declined to comment. Goldman Sachs did not respond for comment.
The most recent NFL team to sell was the Pittsburgh Steelers, last year, valued at $800 million. Pre-recession, the Miami Dolphins and the team’s stadium sold for $1.1 billion.