City council vote and latest news, rumors, etc.
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I am happy that we put up a stronger fight than Seattle ever did to keep their team. I still have that moment in my mind, at the NBA All Star game where Stern put a Seattle reporter in place when he told him Seattle was more interested in paying for a new football arena and baseball arena but not one for the NBA at the time.
All the while Sacramento is going above and beyond what's requested in keeping the NBA in Sacramento. Now there are talks to bring the NBA branded WNBA back and revive a dead franchise?
I have a feeling the Owners are going to look at the situation and ask themselves "What has Sacramento even done to lose the team?" The Maloofs have been TERRIBLE to us in almost every way possible, including lying, going behind our backs to sell the team, not letting us put in an offer, trying to move the team on a few separate occasions....
All the while Sacramento continued to show passion for the Kings, and a fight to keep them here. It's a Rocky story if there ever was one. We keep getting knocked down but we get back up and put up a fight. The Owners are going to look at all of this. Seattle lost their team, and the NBA approved. Sacramento has done nothing to lose their team, and has done everything and more when asked by the NBA to do something.
If the NBA BOG votes to move the Kings then we will know it's Game 6 all over again. The fix would be in, and backroom politics played a part because we have done nothing that would merit losing the team up to and including having an arena deal in place and a buyer for the team.
I have a feeling the Owners are going to look at the situation and ask themselves "What has Sacramento even done to lose the team?" The Maloofs have been TERRIBLE to us in almost every way possible, including lying, going behind our backs to sell the team, not letting us put in an offer, trying to move the team on a few separate occasions....
All the while Sacramento continued to show passion for the Kings, and a fight to keep them here. It's a Rocky story if there ever was one. We keep getting knocked down but we get back up and put up a fight. The Owners are going to look at all of this. Seattle lost their team, and the NBA approved. Sacramento has done nothing to lose their team, and has done everything and more when asked by the NBA to do something.
If the NBA BOG votes to move the Kings then we will know it's Game 6 all over again. The fix would be in, and backroom politics played a part because we have done nothing that would merit losing the team up to and including having an arena deal in place and a buyer for the team.
Don't forget, the BOG does not get any money from this sale, only the Magoofs get the money.
If the sacto bid is close, say around $300 million or $290 million and the Magoofs won't have to pay off the $70 million loan to the city, since the team won't be moving, then the Magoofs actually make out better in the sacto deal, despite the total paid is "slightly lower".
If the sacto bid is close, say around $300 million or $290 million and the Magoofs won't have to pay off the $70 million loan to the city, since the team won't be moving, then the Magoofs actually make out better in the sacto deal, despite the total paid is "slightly lower".
But they do profit from the financial performance and spending of Seattle vs Sac as well as market valuation when they seek to sell. We really don't want to get into a situation where we are pinning our hopes on them basing their decision on what the Maloof's end up with or in any way to do us a favor since they've screwed us over for so long. Not saying there won't be an owner or two that votes along those lines but most will be voting with their wallets and how this ultimately impacts their business in the future (which does have some benefit to us since they won't want to jeopardize future city assistance).
I think coming in 40-50M under the Seattle bid would be a huge mistake.
I think coming in 40-50M under the Seattle bid would be a huge mistake.
And I think there's no way that Mastrov doesn't know the number he needs to get the deal done.
I know it's par for the course for people to try and predict actual numbers, etc. but in this case I think we're all best served to accept that Matrov, Burkle, KJ and everyone else involved has done their due diligence.
I know it's par for the course for people to try and predict actual numbers, etc. but in this case I think we're all best served to accept that Matrov, Burkle, KJ and everyone else involved has done their due diligence.
I assume the extra money from the Seattle group would cover the relocation fee and the loan payoff, whereas Sacramento offer there is no re-location fee included and Mastrov, rather than paying off the loan, would assume the payments on said loan.
Someone please correct me if I am wrong.
EDIT: In regards to the location fee after thinking about it for a bit does the fee come after the sale or do the Maloofs have to pay it before the sale is final?
Someone please correct me if I am wrong.
EDIT: In regards to the location fee after thinking about it for a bit does the fee come after the sale or do the Maloofs have to pay it before the sale is final?
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Yeah, I have no idea if the offer will come in that much under and was just responding to a different posters scenario. I actually think it will be closer.
And I don't doubt their business savvy. Quite the opposite actually as I have a lot of respect for their business sense. I think there is a cap to what they are willing to overspend on the sac market and that it just may be too much under what Hansen/Ballmer were willing to overspend for Seattle.
And I don't doubt their business savvy. Quite the opposite actually as I have a lot of respect for their business sense. I think there is a cap to what they are willing to overspend on the sac market and that it just may be too much under what Hansen/Ballmer were willing to overspend for Seattle.
But the offer sheet was already signed. I know the Maloofs are slime and would probably go back to the table if it means more money for them, but I assumed that the Ballchinboy/Hansen bid is locked in and all we have to do is come up with a competing bid... Which we have.
The BOG already said publicly that they do NOT like having to move a team. We have the fan support, the $$ in Advertising revenue (which will actually be more than 50mil once the new group has their own sales/marketing teams in place), the arena plan and an owner. Why on earth would the BOG approve a move. Answer is they wont unless there was some back room politicking going on.
The BOG already said publicly that they do NOT like having to move a team. We have the fan support, the $$ in Advertising revenue (which will actually be more than 50mil once the new group has their own sales/marketing teams in place), the arena plan and an owner. Why on earth would the BOG approve a move. Answer is they wont unless there was some back room politicking going on.
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Precisely. It was reported a long time ago that there is a numerical difference in purchasing the team with the intention of moving it vs. keeping it where it is. I'm sure they know the number they need to meet and bidding a penny more than necessary only puts more money in the Maloofs pockets, no thanks to that.
My thoughts exactly.
If the kings leave sacramento, the $70 million debt the Maloofs owe the city becomes immediately due to the city. And if the Maloofs don't pay back Sacramento the $70 million, the nba would be faced with the PR nightmare of the Kings moving to Seattle and defaulting on a $70 million unpaid debt with a lot of potential lawsuits and bad PR. Assuming the NBA doesn't want this PR mess and puts a requirement on the Maloofs to pay back Sacramento before they can move/sell the team to Seattle, the Maloofs would be better off if the BOG blocks their sale to the Seattle group.
Therefore, even if the Mastrov bid was around $300 million and the Maloofs won't need to pay back the $70 million loan to Sacramento, then a $300 million bid to keep the kings in Sacramento actually financially favors the Maloofs, plus no relocation fees.
Let's look at the math:
$341million (From Seattle group) - $70 million (paid back to Sacramento) = $271 million for the Maloofs
VS.
$300 million (From Sacramento group) - $0 (paid back to Sacramento) = $300 million for the Maloofs
Therefore, a bid of $300 million from a Sacramento group would still be ultimately $29 million more in the Maloofs pockets then a $341 million bid from Seattle!
If the kings leave sacramento, the $70 million debt the Maloofs owe the city becomes immediately due to the city. And if the Maloofs don't pay back Sacramento the $70 million, the nba would be faced with the PR nightmare of the Kings moving to Seattle and defaulting on a $70 million unpaid debt with a lot of potential lawsuits and bad PR. Assuming the NBA doesn't want this PR mess and puts a requirement on the Maloofs to pay back Sacramento before they can move/sell the team to Seattle, the Maloofs would be better off if the BOG blocks their sale to the Seattle group.
Therefore, even if the Mastrov bid was around $300 million and the Maloofs won't need to pay back the $70 million loan to Sacramento, then a $300 million bid to keep the kings in Sacramento actually financially favors the Maloofs, plus no relocation fees.
Let's look at the math:
$341million (From Seattle group) - $70 million (paid back to Sacramento) = $271 million for the Maloofs
VS.
$300 million (From Sacramento group) - $0 (paid back to Sacramento) = $300 million for the Maloofs
Therefore, a bid of $300 million from a Sacramento group would still be ultimately $29 million more in the Maloofs pockets then a $341 million bid from Seattle!
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To be honest, Mastrov and Burkle are brilliant business men. I don't see them way over bidding on the team, just for public perception. If the kings were actually worth about $450 million, then the 65% share they would be purchasing is about $293 million.
I don't see them bidding near as close to the $341 million by the Seattle group to buy the Kings. Ultimately, the Seattle group had to overpay to be able to move the kings to Seattle. If the kings stay in Sacramento, considering all the factors of relocation fee and debt re-payment, the maloofs still make the same or more to leave the kings in sacramento, even with a lower Mastrov bid.
Mastrov and Burkle are very shrewd business men and I think they will put in a very competitive offer, but I don't want everyone to be disappointed if the offer is not almost the same as the Seattle group.
Like I said, a "slightly lower" bid from sacramento may still be more money in the maloofs pocket in the long run, and the BOG will be made well aware of that fact, I'm sure.
I don't see them bidding near as close to the $341 million by the Seattle group to buy the Kings. Ultimately, the Seattle group had to overpay to be able to move the kings to Seattle. If the kings stay in Sacramento, considering all the factors of relocation fee and debt re-payment, the maloofs still make the same or more to leave the kings in sacramento, even with a lower Mastrov bid.
Mastrov and Burkle are very shrewd business men and I think they will put in a very competitive offer, but I don't want everyone to be disappointed if the offer is not almost the same as the Seattle group.
Like I said, a "slightly lower" bid from sacramento may still be more money in the maloofs pocket in the long run, and the BOG will be made well aware of that fact, I'm sure.
The problem here is that we don't know, in any way, how the city loan is dealt with in the Hansen offer, or if it is dealt with.
The loan is not to the Maloofs proper, it is to the team. The Maloofs actually inherited that loan when they bought the team and under normal circumstances it would stay with the team upon the sale. So I find it difficult to believe that the Hansen sale would be structured in such a way that the Maloofs, and not Hansen, are the ones who are forced to pay off the loan if the team moves to Seattle.
My default assumption is that Hansen will be on the hook for that loan, and that therefore there is no net $70M in the bargain for a local group.
However, it is possible that Hansen's "real" bid is for the controlling shares is $241M, which would put the full value of the team at $371M - for a team that is not debt-free. To be honest, that's probably a more realistic view of the value of the team. Hansen would be on the hook for $70M in debt, and an estimated $30M relocation fee, so the total cost would be $341M. But, to make it look like the total valuation of the franchise is higher (whoa, $525M!!), Hansen might toss that $100M into the bid for the team on the condition that the sale is not final until after the Maloofs move the team to Seattle. Let us note that the Maloofs, not Hansen, filed for relocation a while ago. So, the Maloofs have to pay the estimated $30M relocation fee (and hence the non-refundable $30M pre-payment from Hansen) and also have to pay off the loan because it comes due when they own the team. Then the sale becomes final and they net $241M.
If the deal is structured like that - done in a way to absolutely maximize the apparent value of the franchise by shifting non-ownership costs into the team valuation - then there's a great argument that the Mastrov bid doesn't need to be as high as the Hansen bid. If Mastrov were willing to accept the city loan as a part of the team (obviously it won't come due immediately if the Kings stay at STA while a new arena is being built), then a bid that is $100M short is actually the same thing.
The big thing, we have absolutely no idea whether the Hansen offer is in fact structured like that. It makes some sense, but it's pure speculation and I'd lean against this being the true explanation.
If, on the other hand, Hansen planned to deal with the city loan and relocation on his own, then there's no bargain to be had for local owners. In that case, any amount less than $341M (or any amount less than $311M if the non-refundable money that Hansen deposited truly is non-refundable and the Maloofs keep it) would potentially constitute real damages to the Maloofs and give them standing to file an anti-trust lawsuit if the NBA ruled against them. And if the NBA loses that lawsuit, they have to pay treble damages. So if Mastrov comes in at $337M, the Maloofs could potentially sue and win $12M from the league. The league would definitely have to consider that when making a decision.
In the end, I'm a bit uncomfortable about the Mastrov bid reportedly coming in under the Hansen bid, but let's wait to see how it plays out. But if the Mastrov bid comes in at $241M, I think we know exactly what is going on.
The loan is not to the Maloofs proper, it is to the team. The Maloofs actually inherited that loan when they bought the team and under normal circumstances it would stay with the team upon the sale. So I find it difficult to believe that the Hansen sale would be structured in such a way that the Maloofs, and not Hansen, are the ones who are forced to pay off the loan if the team moves to Seattle.
My default assumption is that Hansen will be on the hook for that loan, and that therefore there is no net $70M in the bargain for a local group.
However, it is possible that Hansen's "real" bid is for the controlling shares is $241M, which would put the full value of the team at $371M - for a team that is not debt-free. To be honest, that's probably a more realistic view of the value of the team. Hansen would be on the hook for $70M in debt, and an estimated $30M relocation fee, so the total cost would be $341M. But, to make it look like the total valuation of the franchise is higher (whoa, $525M!!), Hansen might toss that $100M into the bid for the team on the condition that the sale is not final until after the Maloofs move the team to Seattle. Let us note that the Maloofs, not Hansen, filed for relocation a while ago. So, the Maloofs have to pay the estimated $30M relocation fee (and hence the non-refundable $30M pre-payment from Hansen) and also have to pay off the loan because it comes due when they own the team. Then the sale becomes final and they net $241M.
If the deal is structured like that - done in a way to absolutely maximize the apparent value of the franchise by shifting non-ownership costs into the team valuation - then there's a great argument that the Mastrov bid doesn't need to be as high as the Hansen bid. If Mastrov were willing to accept the city loan as a part of the team (obviously it won't come due immediately if the Kings stay at STA while a new arena is being built), then a bid that is $100M short is actually the same thing.
The big thing, we have absolutely no idea whether the Hansen offer is in fact structured like that. It makes some sense, but it's pure speculation and I'd lean against this being the true explanation.
If, on the other hand, Hansen planned to deal with the city loan and relocation on his own, then there's no bargain to be had for local owners. In that case, any amount less than $341M (or any amount less than $311M if the non-refundable money that Hansen deposited truly is non-refundable and the Maloofs keep it) would potentially constitute real damages to the Maloofs and give them standing to file an anti-trust lawsuit if the NBA ruled against them. And if the NBA loses that lawsuit, they have to pay treble damages. So if Mastrov comes in at $337M, the Maloofs could potentially sue and win $12M from the league. The league would definitely have to consider that when making a decision.
In the end, I'm a bit uncomfortable about the Mastrov bid reportedly coming in under the Hansen bid, but let's wait to see how it plays out. But if the Mastrov bid comes in at $241M, I think we know exactly what is going on.
The problem here is that we don't know, in any way, how the city loan is dealt with in the Hansen offer, or if it is dealt with.
The loan is not to the Maloofs proper, it is to the team. The Maloofs actually inherited that loan when they bought the team and under normal circumstances it would stay with the team upon the sale. So I find it difficult to believe that the Hansen sale would be structured in such a way that the Maloofs, and not Hansen, are the ones who are forced to pay off the loan if the team moves to Seattle.
My default assumption is that Hansen will be on the hook for that loan, and that therefore there is no net $70M in the bargain for a local group.
However, it is possible that Hansen's "real" bid is for the controlling shares is $241M, which would put the full value of the team at $371M - for a team that is not debt-free. To be honest, that's probably a more realistic view of the value of the team. Hansen would be on the hook for $70M in debt, and an estimated $30M relocation fee, so the total cost would be $341M. But, to make it look like the total valuation of the franchise is higher (whoa, $525M!!), Hansen might toss that $100M into the bid for the team on the condition that the sale is not final until after the Maloofs move the team to Seattle. Let us note that the Maloofs, not Hansen, filed for relocation a while ago. So, the Maloofs have to pay the estimated $30M relocation fee (and hence the non-refundable $30M pre-payment from Hansen) and also have to pay off the loan because it comes due when they own the team. Then the sale becomes final and they net $241M.
If the deal is structured like that - done in a way to absolutely maximize the apparent value of the franchise by shifting non-ownership costs into the team valuation - then there's a great argument that the Mastrov bid doesn't need to be as high as the Hansen bid. If Mastrov were willing to accept the city loan as a part of the team (obviously it won't come due immediately if the Kings stay at STA while a new arena is being built), then a bid that is $100M short is actually the same thing.
The big thing, we have absolutely no idea whether the Hansen offer is in fact structured like that. It makes some sense, but it's pure speculation and I'd lean against this being the true explanation.
If, on the other hand, Hansen planned to deal with the city loan and relocation on his own, then there's no bargain to be had for local owners. In that case, any amount less than $341M (or any amount less than $311M if the non-refundable money that Hansen deposited truly is non-refundable and the Maloofs keep it) would potentially constitute real damages to the Maloofs and give them standing to file an anti-trust lawsuit if the NBA ruled against them. And if the NBA loses that lawsuit, they have to pay treble damages. So if Mastrov comes in at $337M, the Maloofs could potentially sue and win $12M from the league. The league would definitely have to consider that when making a decision.
In the end, I'm a bit uncomfortable about the Mastrov bid reportedly coming in under the Hansen bid, but let's wait to see how it plays out. But if the Mastrov bid comes in at $241M, I think we know exactly what is going on.
The loan is not to the Maloofs proper, it is to the team. The Maloofs actually inherited that loan when they bought the team and under normal circumstances it would stay with the team upon the sale. So I find it difficult to believe that the Hansen sale would be structured in such a way that the Maloofs, and not Hansen, are the ones who are forced to pay off the loan if the team moves to Seattle.
My default assumption is that Hansen will be on the hook for that loan, and that therefore there is no net $70M in the bargain for a local group.
However, it is possible that Hansen's "real" bid is for the controlling shares is $241M, which would put the full value of the team at $371M - for a team that is not debt-free. To be honest, that's probably a more realistic view of the value of the team. Hansen would be on the hook for $70M in debt, and an estimated $30M relocation fee, so the total cost would be $341M. But, to make it look like the total valuation of the franchise is higher (whoa, $525M!!), Hansen might toss that $100M into the bid for the team on the condition that the sale is not final until after the Maloofs move the team to Seattle. Let us note that the Maloofs, not Hansen, filed for relocation a while ago. So, the Maloofs have to pay the estimated $30M relocation fee (and hence the non-refundable $30M pre-payment from Hansen) and also have to pay off the loan because it comes due when they own the team. Then the sale becomes final and they net $241M.
If the deal is structured like that - done in a way to absolutely maximize the apparent value of the franchise by shifting non-ownership costs into the team valuation - then there's a great argument that the Mastrov bid doesn't need to be as high as the Hansen bid. If Mastrov were willing to accept the city loan as a part of the team (obviously it won't come due immediately if the Kings stay at STA while a new arena is being built), then a bid that is $100M short is actually the same thing.
The big thing, we have absolutely no idea whether the Hansen offer is in fact structured like that. It makes some sense, but it's pure speculation and I'd lean against this being the true explanation.
If, on the other hand, Hansen planned to deal with the city loan and relocation on his own, then there's no bargain to be had for local owners. In that case, any amount less than $341M (or any amount less than $311M if the non-refundable money that Hansen deposited truly is non-refundable and the Maloofs keep it) would potentially constitute real damages to the Maloofs and give them standing to file an anti-trust lawsuit if the NBA ruled against them. And if the NBA loses that lawsuit, they have to pay treble damages. So if Mastrov comes in at $337M, the Maloofs could potentially sue and win $12M from the league. The league would definitely have to consider that when making a decision.
In the end, I'm a bit uncomfortable about the Mastrov bid reportedly coming in under the Hansen bid, but let's wait to see how it plays out. But if the Mastrov bid comes in at $241M, I think we know exactly what is going on.
i'm sure that mastrov/burkle has seen the frame work for the seattle deal and they will put in their bid accordingly.
thus, i am not surprised that the bid came in "slightly lower" than the seattle bid. i'm pretty sure the bid will essentially give the maloofs roughly the same amount of money or more, if the sacramento bid wins out.
thus, i am not surprised that the bid came in "slightly lower" than the seattle bid. i'm pretty sure the bid will essentially give the maloofs roughly the same amount of money or more, if the sacramento bid wins out.
A HUGE day for Sacramento and us Kings fans!
KJ delivers once again! WhileI should not be the one to question the announcements, I do have a couple of concerns here
1. Burkle name being separated from the team ownership. This might be to bring Maloofs on board but Burkle is the big whale in all this and his name attached to team ownership is worth more than it being attached to the Arena. There have been reports that he is part of the group as well but nothing confirmed yet! Like I said, could be a smart ploy by KJ to bring Maloofs to the table. Is Mastrov really a whale with a reported $350 million net worth? Burkle carries a LOT more weight.
2. The bid being reportedly less than Hansen/Balmer bid. People are assuming that it's because of debt t the city and relocation fee. We are assuming that and it is NOT a foregone conclusion that the $525 million price tag includes those debts. It more logical that the new ownership group assumes that debt as part of buying the team. If you are buying business from someone, you are also taking on their debt.
The slam dunks for me are the following:
1. 20 investors of who The Rock is part of bidding on Cook's 7% share is a stroke of genius. Richmond investing is a slam dunk. Hopefully that $20 million is enough but I am sure Burkle and/or Mastrov would pinch in to tip it in our favour. There is also a danger of Hansen group outbidding us here but I am quietly confident this is a huge plus for us.
2. Brining back WNBA. All I have to say is holly cow! I think this has Stern written all over it! A masterstroke by KJ/Burkle/Mastrov.
Overall a brilliant showing and slam dunk announcements. I still have questions that are unanswered but we just made it a heck of a lot harder for NBA to say no to us!
Let the games begin!
KJ delivers once again! WhileI should not be the one to question the announcements, I do have a couple of concerns here
1. Burkle name being separated from the team ownership. This might be to bring Maloofs on board but Burkle is the big whale in all this and his name attached to team ownership is worth more than it being attached to the Arena. There have been reports that he is part of the group as well but nothing confirmed yet! Like I said, could be a smart ploy by KJ to bring Maloofs to the table. Is Mastrov really a whale with a reported $350 million net worth? Burkle carries a LOT more weight.
2. The bid being reportedly less than Hansen/Balmer bid. People are assuming that it's because of debt t the city and relocation fee. We are assuming that and it is NOT a foregone conclusion that the $525 million price tag includes those debts. It more logical that the new ownership group assumes that debt as part of buying the team. If you are buying business from someone, you are also taking on their debt.
The slam dunks for me are the following:
1. 20 investors of who The Rock is part of bidding on Cook's 7% share is a stroke of genius. Richmond investing is a slam dunk. Hopefully that $20 million is enough but I am sure Burkle and/or Mastrov would pinch in to tip it in our favour. There is also a danger of Hansen group outbidding us here but I am quietly confident this is a huge plus for us.
2. Brining back WNBA. All I have to say is holly cow! I think this has Stern written all over it! A masterstroke by KJ/Burkle/Mastrov.
Overall a brilliant showing and slam dunk announcements. I still have questions that are unanswered but we just made it a heck of a lot harder for NBA to say no to us!
Let the games begin!
I would add the committed $50 millions in sponsorships and tickets sales over the next 5 years. It seems like a minor announcement but I think it is a very strong message to the BOG that Sacramento is a viable market.
KJ played his plan perfectly :
1. Finding a solid new owner
2. Building a new arena deal
3. Showing the strong local and fans support
4. Proving Sacramento is a good economical market
KJ played his plan perfectly :
1. Finding a solid new owner
2. Building a new arena deal
3. Showing the strong local and fans support
4. Proving Sacramento is a good economical market
Absolutely correct! In all the excitement, I forgot about the sponsorship pledges of $50 million over 5 years. A big part of the plan and it once again shows that this market is legitimate!
Maybe Clay Bennett, wearing purple tie of course, and his men make another trip to Sacramento to make sure these are legit!
Maybe Clay Bennett, wearing purple tie of course, and his men make another trip to Sacramento to make sure these are legit!
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