An initial round of bidding for the Clippers closed yesterday with "at least three potential buyers making offers and predicting that the winner will pay" well over $1B, according to sources cited by James Rainey of the L.A. TIMES. A source said that a group that includes L.A.-based investors Tony Ressler and Bruce Karsh, along with former NBAer Grant Hill, offered $1.2B. Ressler is the co-Founder of Ares Management and a minority owner of the Brewers, while Karsh is President & co-Founder of Oaktree Capital Management. The $1.2B figure is "more than double the highest price ever paid for an NBA team." Other bidders for the Clippers include a group from Guggenheim Partners and former Microsoft CEO Steve Ballmer. A source said that an offer also is "expected to come from a group backed by Middle Eastern investors." The size of those offers "has not been disclosed and the suitors expect another round of bidding." Although team co-Owner Rochelle Sterling "wants a quick sale, several hurdles remained." That includes picking a winning bid, "gaining the cooperation" of husband Donald Sterling and "persuading three-quarters of the NBA's other owners to sign off on the deal." The first two steps "need to occur in the next few days to beat a deadline Tuesday, when NBA owners are scheduled to vote in New York on whether to strip the Sterlings of ownership of the Clippers." Meanwhile a development that "seemed to remove one possible impediment to a deal" is that Rochelle Sterling appears to have "given up her insistence on keeping a minority stake in the team." She had "expressed a desire to hold on to one-third, or less, of the Clippers, a proposal the league has deemed unacceptable." The term sheet the bidders responded to before yesterday's deadline was "for a purchase of 100% of the franchise, which is held in the Sterlings' family trust" (L.A. TIMES, 5/29).
LET'S GET TOGETHER: REUTERS' Ronald Grover reported Guggenheim Partners co-Founder and Dodgers Chair Mark Walter, along with Guggenheim President and Dodgers co-Owner Todd Boehly, "are helping" DreamWorks SKG co-Founder David Geffen "put together a group to bid" on the Clippers. Guggenheim yesterday in a statement said that Walter and Boehly are "joining Geffen's existing group of bidders," which includes Oprah Winfrey and Oracle CEO Larry Ellison. Guggenheim added that the two top execs were "teaming up with Geffen to put together a bid, but that the bank itself was not officially involved in the process" (REUTERS, 5/28). BLOOMBERG NEWS' Soshnick & Pettersson cite a source as saying that Goldman Sachs Managing Dir Andrew Gordon "presented the Geffen group's bid in person" (BLOOMBERG NEWS, 5/29). Meanwhile, ESPN’s Bill Simmons said, “There are so many variables to owning a franchise. You want to the see the numbers, you want to talk to people. They are asking the team to do this in 48 hours. That’s why this is, I think, the craziest sale process in basketball history” (“NBA Countdown,” ESPN, 5/28).
SOME STRINGS ATTACHED: Rochelle Sterling still wants a presence at Staples Center after the Clippers are sold. A source said that included in the term sheet made available to interested bidders is a provision providing courtside tickets to Rochelle Sterling as part of a sale. She also is asking for tickets in other areas of Staples Center, parking and VIP access in the arena. The ticket request is a sure signal of a deal in the making, said Game Plan Chair Bob Caporale, whose company has been involved in numerous team sales. “When they ask for tickets, I know they are going to sign,” he said (John Lombardo, Staff Writer).
BIDDERS WORRIED: ESPN.com's Shelburne & Rovell reported despite the "pace of the sale and seriousness of the buyers," Donald Sterling's continuing opposition is "beginning to worry several groups." A source said that the concern is that he is "using this sale process to establish a value for the team so he later can sue the league for damages if forced to sell." Max Blecher, Sterling's attorney, said that his client has "no intention of selling and has only grown stronger in his resolve to fight the NBA's charges against him." A letter sent to the NBA on May 22 stated Sterling "agrees to the sale of his interest" in the team and confirms he authorized his wife to negotiate with the NBA "regarding all issues in connection with a sale" of the team. However, Blecher said that his client had "changed his mind since then." Blecher: "On May 22, that's what he wanted to do. But as time has evolved, he's come to a much more hard-line position" (ESPN.com, 5/28).
LOOKING FOR LEVERAGE? USA TODAY's Brent Schrotenboer writes Sterling by "threatening to fight ... puts pressure on the NBA, which prefers to avoid a messy fight in the courts." By proceeding "down a separate track to sell the team, possibly even naming a prospective buyer in the next few days, the family is trying to keep control of the negotiations on its terms." A source said that the "no-sale talk from Donald Sterling is thought to be posturing." His "threat to fight gives him leverage while his wife works to sell the team -- with his blessing in writing" (USA TODAY, 5/29). In N.Y., Sandomir & Cacciola cite sports law experts as saying that there "might be some logic in Sterling’s letting his wife negotiate the sale while pursuing a full-throated, all-or-nothing defense." Tulane Univ. Sports Law Program Dir Gabe Feldman: "It could be a matter of principle for Sterling, of trying to save his name. It could be a leverage play -- that it's going to take a sizable offer for him to sell his team, that he will sell only for the right price, but not because he's required to" (N.Y. TIMES, 5/29).
