Friday, April 12, 2013
SEATTLE — As a deadline for a Sacramento group to make a bid for the Kings neared, a complication emerged Thursday.
At issue is the status of a $30-million, nonrefundable payment already made to the controlling owners, the Maloof family, by a Seattle group led by Chris Hansen and Microsoft CEO Steve Ballmer.
Sports Business Daily reported Thursday that the NBA has asked the Sacramento group to compensate the Seattle contingent for the deposit if the league decides to not allow the sale. The NBA is scheduled to vote on whether to approve the sale at its annual Board of Governors meetings in New York next Thursday and Friday.
Sports Business Daily, citing an unnamed source, said one reason for the request is to show that the league will still consider Seattle a highly valued market even if it did not get the Kings.
The report reiterated what another source told The Times, that a potential sticking point in the negotiations between the Sacramento group and the Maloof family is the $30 million, which according to one source is in addition to the $340 million Hansen’s group agreed to pay for 65 percent of the team at a total valuation of $525 million.
A league source said the Sacramento group has yet to account for the payment, while the Maloofs view it as requirement for a matching deal.
The Maloof family set a deadline of 5 p.m. Friday for the Sacramento group to submit a written, binding bid that would be considered as a backup offer if the Seattle sale is denied, according to The Sacramento Bee. The Bee reported if the deadline is not met, the Maloofs will not consider any Sacramento offers.
While it is expected that a bid will come on Friday, it’s thought the NBA isn’t putting much weight behind the deadline.
The Sports Business Daily report of the NBA’s request of the Sacramento group was the latest evidence of the league’s apparent involvement in the city’s attempt to keep the Kings.
During an impromptu press briefing Thursday night at which he stated that the city will be able to match the Seattle bid, Sacramento mayor Kevin Johnson said: “Our ownership group is talking to the NBA and the Maloofs’ attorneys and lawyers on a regular basis.”
It’s a trend that has left some wondering if commissioner David Stern is attempting to steer the NBA’s decision toward keeping the Kings in Sacramento despite comments he has made several times that he is merely a bystander.
“This is strictly about what the owners decide,” Stern said at the All-Star Game in February.
One source, though, said Stern has played an active role in helping Johnson assemble an ownership group and an arena plan that would provide a legitimate counteroffer to Seattle’s.
One example cited was Stern’s comments last month that Sacramento’s initial bid for the team was not competitive. While viewed by some as a positive for Seattle, others said it could also have been interpreted as Stern sending a signal to investors in Sacramento to hop aboard. Sacramento’s ownership group has changed drastically since then, with Vivek Ranadive — a Silicon Valley entrepreneur and current part-owner of the Golden State Warriors — becoming the lead investor.
Some also point to Stern’s statement after each city met before the NBA last week in New York that the league may require more time to make a decision on the sale of the team to Seattle beyond next week’s BOG meetings.
That may have been in part tied to this week’s announcement that Ron Burkle — initially portrayed as a key ember of Sacramento’s investment group — was stepping out of an active role due to a conflict of interests.
Sacramento reportedly continues to attempt to round out its ownership group — the Sports Business Journal wrote Thursday that it is expected the city will “announce some new investors” on Friday.
Stern has said often throughout his tenure that he views relocating a team as a “last resort,” and some say his efforts helping Sacramento may simply fall in line with that philosophy.
“Stern values process,” said Michael McCann, an on-air legal analyst for NBA-TV. He’s also thought to value the Sacramento government’s support for keeping the Kings, which contrasts with what he felt was a lack of support for the Sonics in Seattle in 2006-08, before the team’s move to Oklahoma City.
Since the meetings last week, though, there have been rumblings in league circles that Seattle’s presentation was considered by some owners as having fewer loose ends. That has led to speculation that the owners who oppose the Maloofs’ desire to sell to Seattle might not fall as easily in line as they have in the past if Stern attempts to sway them away from relocation. Only one time in Stern’s tenure has the NBA not allowed a sale and relocation request: in 1994 when a group attempting to buy the Minnesota Timberwolves was found to not have the necessary financial backing.
A sale requires approval by 23 of the NBA’s 30 owners.
That Stern has already announced his retirement as of next Feb. 1 could be a factor. Another potential factor is a willingness among owners to simply go with what may be perceived as the stronger financial bid, especially if Hansen is willing to increase his offer to combat a new Sacramento bid — Stern has indicated he does not want this to become a bidding war between the cities.
“If there is a rift between Stern and NBA owners, there seem to be at least two contributing reasons,” McCann said. “One is that NBA owners may place a higher value on maximizing value. Another is that owners know Stern is retiring next year. In the twilight of his tenure, some owners may believe they have greater ability to challenge him. They may or may not be mistaken about that. It’s hard to see Stern as a lame duck.”