Saints Owner Buys Hornets For $338M, Vows To Keep Franchise In New Orleans
NBA Commissioner David Stern on Friday “secured the signature” of Saints Owner Tom Benson on a contract to buy the Hornets from the NBA for $338M, “fulfilling a promise Stern made to New Orleans when the league acquired the team from founding owner George Shinn in December 2010 that the Hornets will remain in the Crescent City,” according to a front-page piece by Jimmy Smith of the New Orleans TIMES-PICAYUNE. It was Stern’s “unwavering dedication” to New Orleans that keeps the NBA in the city. Stern: “I always believed we had that obligation to New Orleans. In fact, I thought that and I felt there were issues or constraints that made it difficult for George to continue as an owner, and he really wanted very much to have the team stay in New Orleans.” SportsCorp President Marc Ganis, who helped facilitate the deal, said that it was the vision of both Benson and Stern “that cemented the Hornets’ future in New Orleans.” Ganis: “(Stern) could have gotten more than half-a-billion dollars for this team, but that wasn’t his interest. That was important. Both principals had the same motivation. And you had one that controlled the asset and could sell it, and one who had the resources and could buy it at the price that was a break-even for the league” (New Orleans TIMES-PICAYUNE, 4/15). In New Orleans, Jeff Duncan noted Benson was seen as a "long shot to gain control of the team.” California-based businessman Raj Bhathal “emerged as the front-runner a few months ago,” and former Hornets investor Gary Chouest was “long considered the leading local investor.” With a “nudge from Gov. Bobby Jindal and NBA Commissioner David Stern, Benson re-entered the race a couple of weeks ago and blew everyone out of the water” with his bid. The sale was “conditional on ownership keeping the team in New Orleans through the life of the new lease agreement, which extends through 2024” (New Orleans TIMES-PICAYUNE, 4/14).
HOW THE DEAL WAS DONE: Benson cited as one of the main reasons he bought the team an “innate fear” that an absentee owner “might try to move the team in desperate times.” The TIMES-PICAYUNE’s Smith noted Benson’s “expedient rise to the top of a trio of potential owners or ownership groups accelerated in recent weeks when he revisited the bidding process after initially walking away because he thought the league’s asking price for the franchise was too steep.” Benson said that one of his first tasks is “a nickname change that would more closely identify his NBA team with the city wherein it resides.” He said that he “would own 100 percent of the club without partners, other than his wife, Gayle.” The NBA BOG “still must formally authorize the sale once Benson is completely vetted by the league.” But Stern said that there “should be no impediments toward ultimate approval.” Benson noted that he “assumes $125 million in debt the team has on its books.” Stern last week said that the league “was aggressively negotiating with three parties for the potential purchase but pointed to Benson’s track record as an owner of a major sports franchise as critical in the league’s desire to add him into its brotherhood.” Benson said that he “plans to run the Saints and Hornets separately” with Saints Exec VP & CFO Dennis Lauscha “overseeing the business aspects of both clubs” and Saints GM Mickey Loomis "in charge of the sports operations" (New Orleans TIMES-PICAYUNE, 4/14). Benson said, “I got involved a month ago, and let me tell you, it has been some frantic ride. I talked to my wife, I talked to the archbishop, I talked to the governor. Everyone was going crazy. When I was on the phone with Governor Jindal, telling him what I was going to do, I thought he was coming through the phone to kiss me" (New Orleans TIMES-PICAYUNE, 4/15).
THE PRICE TAG: In N.Y., Richard Sandomir reported by selling the Hornets to Benson, the league “made back the $318 million it paid ... when it acquired the money-losing franchise from George Shinn, and about $20 million more to cover its losses.” NBA Deputy Commissioner & COO Adam Silver said that the league was “not looking to make a profit on the deal or engage in a bidding war.” Silver: “For one of the smallest markets, it’s a very full price” (N.Y. TIMES, 4/14). In Boston, Gary Washburn noted Benson mentioned “several times” during his press conference that the NBA “did not offer a hometown discount, though Stern is relieved that the league is no longer in the ownership business and has passed the franchise along to capable hands.” Stern: “There were many prospective people who were interested. I think Tom recognized what he could do for the team, what the team could do for the city. And for other, I would say, joint business opportunities for entertainment and further development he was the natural purchaser, and we gave him the opportunity to do that” (BOSTON GLOBE, 4/15).
DOWN IN THE BAYOU: In New Orleans, John Reid noted Benson’s purchase of the Hornets “brought stability to the team’s future in New Orleans.” A league source said that Benson “plans to keep Monty Williams as coach and Dell Demps as general manager, both of whom were hired in 2010.” Williams said that the settlement of the ownership issue “brings ease to a franchise that seemed to be teetering.” Williams: “I think it can only be good for me as a coach, our players and especially our city, and that fans can totally commit to our city.’’ Hornets Chair Jac Sperling and President Hugh Weber in a statement said that Benson’s ownership “reinforces the positive momentum they are building.” Benson in a letter to Hornets fans “vowed to continue to do with the NBA franchise what he has done with the Saints, who won Super Bowl XLIV” (New Orleans TIMES-PICAYUNE, 4/14).
NO MORE CONSPIRACY THEORIES, FOR NOW: L. A. Times columnist Bill Plaschke said a “dark day in the NBA has ended” with Saints Owner Tom Benson acquiring the Hornets. Plaschke: “It’s great Benson bought them, keep them in New Orleans. ... But the better thing here is the NBA no longer owns a team. The NBA should never own a team again. ... It's bad business” (“Around The Horn,” ESPN, 4/13). In N.Y., Mitch Lawrence cited an Eastern Conference president as saying, “At least now if the Hornets win the lottery, the league won’t have that problem on its hands. Can you imagine the P.R. nightmare Stern would have had if (the NBA) still owned the team and he got up at the lottery and announced that the Hornets had won it? You’d have people laughing all over the place at us” (N.Y. DAILY NEWS, 4/15).
BUZZ OFF: The TIMES-PICAYUNE’s Duncan writes Benson’s proclamation to change the team name has created “a buzz among the fans, who have universally endorsed the idea.” Under Weber’s “shrewd direction, the organization has done a remarkable job of rebranding itself into a New Orleans business since moving back home in 2007” from Oklahoma City, where the team was temporarily relocated due to Hurricane Katrina. The color schemes and logos “have changed to better reflect local customs, and this strategy inspired” the popular “NOLA” Mardi Gras uniforms. The league “usually requires a two-year window” to complete the task changing the nickname, primarily “because of merchandising and marketing purposes.” Duncan writes the Hornets’ nickname “isn’t particularly bad, but it’s far from appropriate” (New Orleans TIMES-PICAYUNE, 4/16). The Hornets relocated from Charlotte in '02 and the city was awarded the expansion Bobcats in '04. In Charlotte, Tom Sorensen wrote, “If I were the Bobcats, and I wanted to show fans I cared, I'd change my name to Hornets” (CHARLOTTE.com, 4/13).