Mar 4, 2013, 11:37 PM EDT
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.
Apr 21, 2014, 9:47 AM EDT
Hawks point guard scored 28 points in Game 1 upset of Pacers
Al Jefferson got two shots in his injured foot, left arena in walking boot, plans to play through it
Apr 21, 2014, 8:44 AM EDT
Charlotte already had a slim margin for error against Miami (if that) and their star being hobbled is not helping matters.
Apr 21, 2014, 8:00 AM EDT
Hopefully the refs let the Clippers and Warriors play some playoff basketball this time around. Thunder/Grizzlies Game 2 as well on Monday.
Apr 21, 2014, 3:49 AM EDT
Houston point guard to have MRI Monday
Apr 21, 2014, 2:32 AM EDT
Aldridge set a Blazers record with 46 points in a playoff game. Nene reminded everyone why he
Apr 21, 2014, 2:29 AM EDT
Aldridge scores 46 points, grabs 18 rebounds to lead comeback
Apr 20, 2014, 10:02 PM EDT
Nene gets his first start since February and the Wizards steal Game 1.
Apr 20, 2014, 8:30 PM EDT
Kemba Walker made James Jones look bad.
Apr 20, 2014, 6:58 PM EDT
Bobcats were scrappy, but with Al Jefferson hurting Miami just had too much LeBron James and Dwyane Wade.
Apr 20, 2014, 5:43 PM EDT
Touching moment as Gregg Popovich delivers a heartfelt message.
Apr 20, 2014, 4:21 PM EDT
Spurs close the game on a 19-4 run after trailing by double digits.
Apr 20, 2014, 3:30 PM EDT
Statement confirms referees handled replay review correctly, but also admits that they missed the initial foul call on a critical possession.
Apr 20, 2014, 2:00 PM EDT
If Jim Buss fails to deliver in quickly rebuilding the Lakers, he says he’ll resign.
Apr 20, 2014, 12:30 PM EDT
Roy Hibbert owned up to a poor Game 1. Will he do anything about it in Game 2 is the question.
Apr 20, 2014, 11:00 AM EDT
Shot clocks stopped working midway through the third quarter, but Raptors say all will be well in time for Game 2.
Apr 20, 2014, 9:30 AM EDT
Where you going, Evan?
Apr 20, 2014, 8:00 AM EDT
“That’s what I do!”
Apr 20, 2014, 12:44 AM EDT
OKC led by as many as 25 points in the first half.
Apr 19, 2014, 11:30 PM EDT
Roy Hibbert wasn’t good in Game 1 against the Hawks, and this play epitomized his performance.
Apr 19, 2014, 10:01 PM EDT
The eight-seed Hawks blowout the Pacers in Game 1.
- Monday NBA playoff previews: Expect a different looking Clippers/Warriors game. 0
- Sunday NBA grades: Nene, Aldridge lead day where big men shine 3
- LaMarcus Aldridge’s Trail Blazers claw back for Game 1 win over Houston Rockets 16
- Bulls have no answer for Nene as Wizards take Game 1 18
- Charlotte is scrappy but Heat have too much in comfortable 99-88 win 20