Mar 4, 2013, 11:37 PM EST
As Sacramento Mayor Kevin Johnson has been advertising for the past month, we did indeed get confirmation of the identity of his ‘whales’ at his State of the City address on Thursday.
Reiterating parts of his four-part plan that included bringing together a local ownership group, finding big equity investors (whales), putting together a downtown arena deal, and demonstrating the value of the Sacramento marketplace – Johnson would announce that 24 Hour Fitness founder Mark Mastrov and billionaire Ron Burkle would put in a bid to keep the Kings in Sacramento.
“With all due respect to Seattle, I do hope they get a team someday, but let me be perfectly crystal clear, it is not going to be this team,” said Johnson.
Johnson also announced that former Kings great Mitch Richmond would join the local ownership group and that the city’s proposal would include an option to return WNBA basketball to Sacramento.
Sources close to the situation told PBT that the framework of the offer delivered to the NBA on Friday was very close to Seattle’s $341 million offer for a controlling 65 percent interest in the club. NBA spokesman Tim Frank confirmed delivery of the offer on Friday, the day of the deadline.
Over the next month Sacramento will continue to iron out the details on a public subsidy and arena deal locally with the Sacramento City Council, which will ultimately vote on a term sheet to be delivered to the Board of Governors in time for their April 18-19 meeting.
Sources tell PBT that the Sacramento offer will be conveyed by the group to the NBA’s joint committees in charge of reviewing the situation on or around April 1. It is expected that Seattle’s group will also meet with that committee around that time, though no meeting has been publicly acknowledged.
According to sources, the two issues that will drive the conversation is the league’s strategy for securing arena subsidies in the future, and the impact each market will have on team revenues and the league’s financial model as a whole. Also under consideration are timelines to deliver an arena, ownership groups, and the precedent the league could set by blocking an owner from selling to a group of their choosing.
The league blocked a sale of the Minnesota Timberwolves to a group headed by boxing promoter Bob Arum in 1994, but a well-placed source told PBT that the league views this transaction as “unprecedented,” citing that never before has the league relocated from a city that has supported its team both at the gate and with public subsidy dollars.
The Maloof ownership group reportedly has “little to no leverage” in NBA’s decision-making process. They also reportedly owe the NBA in excess of $100 million on a line of credit they’ve used throughout their ownership. If called in, the family’s financial woes could give the league an opening to use the ‘Best Interests of the League’ clause, similar to the way Major League Baseball removed Dodgers owner Frank McCourt.
Sources do not expect the Maloof family to push back on the league’s decision to back either Sacramento or Seattle, citing the prohibitive costs of an antitrust lawsuit, and the potential for the family to lose a chance to cash out in Sacramento or Seattle.
The issue of market comparisons between Sacramento and Seattle is cloudy, but sources expect Sacramento to be competitive in that area because it has one major sports team in their No. 20 TV market, while Seattle could have six major sports teams in its No. 12 TV market. We will cover this in a bit more detail later in the next few weeks.
While details about Sacramento’s ownership group are a bit hazy at this time, it has been expected that Mastrov would be the front man. The more private Burkle reportedly would focus on the development of the Downtown Plaza location. Sources indicate the duo will share in the ownership of a potential deal, though it’s unclear what those percentages will be. Both owners have been vetted by the NBA, and Mastrov finished second in the Golden State Warriors bid that recently went to the Joe Lacob group.
While Seattle’s Chris Hansen-Steve Ballmer group has enormous wealth, another well-placed source speaking to PBT under condition of anonymity said the league is happy with both ownership groups and not to expect a deal to hinge on any comparison between them.
If a showdown comes to the owners’ deciding vote, some sources hinted at a scenario in which the league tells the Hansen group that they’re going to choose Sacramento – allowing the Hansen group to bow out gracefully and avoid a divisive ownership vote.
Should the league favor Sacramento, sources say the work the city has done to fight for its team and the narrative it will give the league to sell to future cities in arena negotiations will have played a critical role in the NBA’s decision-making process.
Seattle’s deal contains a greater percentage of private funds due to local initiative-91 requiring public funds to return a guaranteed profit, which is a trend the league wants to avoid. On the other hand, Sacramento’s deal fits the public-private model the league is selling to cities, with a larger public subsidy going toward a new state-of-the-art building in a downtown revitalization effort.
We will cover that issue in greater detail in the coming weeks.
In order to keep their team, Sacramento will need eight votes out of 29 other owners to block the transfer of ownership to Seattle’s Hansen/Ballmer group.
Jan 27, 2015, 10:30 AM EST
Matt Barnes intentionally fouled Danilo Gallinari late, and Shaw believes free throws should have been awarded.
Jan 27, 2015, 9:50 AM EST
Jan 27, 2015, 9:10 AM EST
Five of the six players in the field are set.
Jan 27, 2015, 8:30 AM EST
She tweeted out a vote for him, and she has 18.8 million followers.
Jan 27, 2015, 8:00 AM EST
Then he finishes it off with a dunk of his own.
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Jan 27, 2015, 2:02 AM EST
Jamal Crawford had a monster night, too.
Jan 27, 2015, 1:36 AM EST
This was not pretty.
Jan 27, 2015, 12:00 AM EST
Galloway has played well through two 10-day contracts.
Jan 26, 2015, 11:15 PM EST
The Pelicans blew out the Sixers.
Jan 26, 2015, 10:30 PM EST
Jan 26, 2015, 9:45 PM EST
The Nets have lost eight of their last 10.
Jan 26, 2015, 9:00 PM EST
They will wear them on February 20.
Jan 26, 2015, 8:11 PM EST
Durant suffered the injury on Sunday in Cleveland.
Jan 26, 2015, 7:30 PM EST
Will Steve Kerr start Klay Thompson or James Harden?
Jan 26, 2015, 6:43 PM EST
Did you really think Kobe Bryant was going to leave the game on anything but his own terms?
Jan 26, 2015, 6:20 PM EST
He likely returns in the middle of March.
Jan 26, 2015, 5:32 PM EST
Of course, Nick Young’s answer to all problems is more Nick Young.
Jan 26, 2015, 4:29 PM EST
And Russell Westbrook at center
Jan 26, 2015, 3:37 PM EST
He should be back for the start of next season.
Report: Kemba Walker could miss six weeks, Hornets teammates Marvin Williams and Bismack Biyombo also injured
Jan 26, 2015, 3:22 PM EST
Charlotte’s playoff odds just got much longer
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