Virginia Beach Kings?!

[VF21]

Without clearing this with me, you chose to tell everybody about the animosity between you and I. What you didn't say is that we had made an agreement not to comment on what the other said. Apparently you do not believe that agreements hold for you. If you want to bring our animosity out publicly, let's have at it. I can play the same game.

Have a nice day.

Um, okay...???

 

[VF21]

This is true but could also work against Sacramento because what happens if the Maloofs biggest offer to sell the team is from someone outside of Sacramento?

If the best offer to keep the team in Sacramento is at $325 million yet someone else is offering $425 million, what type of leverage and legal advantage does the league have? If the Maloofs say that they are better off keeping the team at Arco/PBP as opposed to taking a $325 million offer, does the league then throw up it's hands and let them sell for $425, knowing that it gets the Maloofs out of the club? And what if the relocation site is one that they could live with and doesn't reek like VB?

Good questions all...and just more reasons why I, like kennadog, despise the Maloofs and the situation they have put all Kings fans into. I guess I still retain some of my starry-eyed optimism; I like to believe that the NBA owners see the fans in a better light than they do the Kings ownership, which has really given the owners no reason to support them. Am I right? I don't know but I do know I'm looking forward to this season with optimism and hope and I'll be damned if I let the freaking Maloofs take it away from me.

 

[Section 101]

This is true but could also work against Sacramento because what happens if the Maloofs biggest offer to sell the team is from someone outside of Sacramento?

If the best offer to keep the team in Sacramento is at $325 million yet someone else is offering $425 million, what type of leverage and legal advantage does the league have? If the Maloofs say that they are better off keeping the team at Arco/PBP as opposed to taking a $325 million offer, does the league then throw up it's hands and let them sell for $425, knowing that it gets the Maloofs out of the club? And what if the relocation site is one that they could live with and doesn't reek like VB?

that is only the offer for the team. It doesn't include a relocation fee that goes to the league and paying off the city loan. So if the fee is $75+mil the total cost to buy the team and move it is now $570+ mil. The league has to approve all new owners so it's not like they can sell to whoever they want.

 

[Trueblood]

that is only the offer for the team. It doesn't include a relocation fee that goes to the league and paying off the city loan. So if the fee is $75+mil the total cost to buy the team and move it is now $570+ mil. The league has to approve all new owners so it's not like they can sell to whoever they want.

Sort of. This is why I limit what I say since I don't know all the legalities involved but like I said in my post, if the hypothetical new owner and relocation site is something that the league approves of then we have to ask the question of what is more important to the league, getting rid of the Maloofs and bringing in a responsible ownership group and passable relocation site or keeping the Maloofs in the fold, knowing that it at least keeps Sacramento in the game for the time being?

Also, nobody is going to purchase and relocate the team for $575. Even the Maloofs aren't clueless enough to think anyone will pay that.

If you look at the recent history of in debt franchises being sold, you'll notice that the debt is subtracted from the sale price. The Nets were basically given to Mikhail Prokhorov for free in exchange for taking on the team debt, getting a stake in the Atlantic Yards project and fronting a good chunk of the construction cost of Barclays Center.

Bob Johnson and Michael Jordan agreed that the Bobcats were valued at $275 million but since they had $100 million in debt, Jordan agreed to pay just $175 million and then take on and pay off the debt.

OTOH, you and others may be on to something with the relocation fee. What can the NBA legally do? If they can just arbitrarily charge any relocation fee that they want, then yeah, they'll try to screw the Maloofs into a corner and make the fee be $200 million for all we know.

But there are also legal guidelines to follow. How do we know that relocation fees aren't part of the new cba? What type of legitimate lawsuit can the Maloofs threaten if the relocation is fee is double what OKC, Memphis and New Orleans paid? I admit to not knowing any of this but I have to think that there is some sort of limit to what the league can charge and if it's small enough, the Hansen's and Ellison's of the world won't have a problem paying that.

 

[JB_kings]

It's my estimation that the Maloofs are stuck. The overly generous $400 price offered for the Kings actually pens out to about $40 million in the Maloofs pockets after all the debt has been subtracted out. The Maloofs are not going to sell the team unless that offer goes a lot higher. The price tag is VERY expensive to buy the Kings and move them. There is just way too much debt involved here.

Actually sitting on the team isn't such a bad idea if they didn't like the numbers involved in the arena deal. And honestly, I can see some of the Maloofs point on the risk they face stepping into the deal as I saw it. The stinker in that deal is the debt on the existing '97 loan that has to be serviced. It has to be dealt with so that the Kings as a team (forget who owns the team for a moment) can be profitable.

My answer? I think the only way the city gets to build a new arena and keep the Kings is to relieve that '97 loan debt off the team. The problem is that the Maloofs burned so many bridges with the locals, it would never fly in discussion. So perhaps the solution is for the city to make an offer to rework the bonds and have them paid by another source arranged by the city. On one condition, that the Maloofs sell the team to owners committed to the rest of the arena deal. What that does is takes the Maloofs walk away profit from $40 million up to just over $100 million. That is about as good as any mid market team sale is going to net.

Sure that's a bitter pill to swallow. But there's bigger poison pills to swallow that involve losing the team. The only way to keep the team and get rid of the Maloofs is to pay them to leave. As it sits right now, there is not one prospective owner who can outbid Chris Hansen motivated enough to make up that gap. The city has work to do to come up with an answer before Hansen finds a way to put enough cash in the Maloofs pockets to say yes. So the pressure is on the city.

 

[Trueblood]

It's my estimation that the Maloofs are stuck. The overly generous $400 price offered for the Kings actually pens out to about $40 million in the Maloofs pockets after all the debt has been subtracted out. The Maloofs are not going to sell the team unless that offer goes a lot higher. The price tag is VERY expensive to buy the Kings and move them. There is just way too much debt involved here.

Actually sitting on the team isn't such a bad idea if they didn't like the numbers involved in the arena deal. And honestly, I can see some of the Maloofs point on the risk they face stepping into the deal as I saw it. The stinker in that deal is the debt on the existing '97 loan that has to be serviced. It has to be dealt with so that the Kings as a team (forget who owns the team for a moment) can be profitable.

My answer? I think the only way the city gets to build a new arena and keep the Kings is to relieve that '97 loan debt off the team. The problem is that the Maloofs burned so many bridges with the locals, it would never fly in discussion. So perhaps the solution is for the city to make an offer to rework the bonds and have them paid by another source arranged by the city. On one condition, that the Maloofs sell the team to owners committed to the rest of the arena deal. What that does is takes the Maloofs walk away profit from $40 million up to just over $100 million. That is about as good as any mid market team sale is going to net.

Sure that's a bitter pill to swallow. But there's bigger poison pills to swallow that involve losing the team. The only way to keep the team and get rid of the Maloofs is to pay them to leave. As it sits right now, there is not one prospective owner who can outbid Chris Hansen motivated enough to make up that gap. The city has work to do to come up with an answer before Hansen finds a way to put enough cash in the Maloofs pockets to say yes. So the pressure is on the city.

Good post. I've calculated that the breakeven sale number is roughly $300 million so they're definitely looking for something above that but with your reasoning, you can make a case for Sacramento in that the price of land loan debt, roughly $68 million, MAY not be much more than what a relocation fee will be.

Like I noted, Hansen will want the loan number subtracted from the sale price whereas your deal has a new Sacramento owner taking it on. But Hansen will have to pay a relocation fee, something that a Sacramento owner wouldn't have to.

From there, the final hurdle is to get a Sacramento bid that is close to whatever Hansen is offering. I wonder if KJ has been calculating and considering all this when bringing in bids to the Maloofs?

 

[Section 101]

Sort of. This is why I limit what I say since I don't know all the legalities involved but like I said in my post, if the hypothetical new owner and relocation site is something that the league approves of then we have to ask the question of what is more important to the league, getting rid of the Maloofs and bringing in a responsible ownership group and passable relocation site or keeping the Maloofs in the fold, knowing that it at least keeps Sacramento in the game for the time being?

Also, nobody is going to purchase and relocate the team for $575. Even the Maloofs aren't clueless enough to think anyone will pay that.

If you look at the recent history of in debt franchises being sold, you'll notice that the debt is subtracted from the sale price. The Nets were basically given to Mikhail Prokhorov for free in exchange for taking on the team debt, getting a stake in the Atlantic Yards project and fronting a good chunk of the construction cost of Barclays Center.

Bob Johnson and Michael Jordan agreed that the Bobcats were valued at $275 million but since they had $100 million in debt, Jordan agreed to pay just $175 million and then take on and pay off the debt.

OTOH, you and others may be on to something with the relocation fee. What can the NBA legally do? If they can just arbitrarily charge any relocation fee that they want, then yeah, they'll try to screw the Maloofs into a corner and make the fee be $200 million for all we know.

But there are also legal guidelines to follow. How do we know that relocation fees aren't part of the new cba? What type of legitimate lawsuit can the Maloofs threaten if the relocation is fee is double what OKC, Memphis and New Orleans paid? I admit to not knowing any of this but I have to think that there is some sort of limit to what the league can charge and if it's small enough, the Hansen's and Ellison's of the world won't have a problem paying that.

Relocation isn't part of the CBA. It's between the owners. The owners set the fee price based on the relocation commitees recomendation.

 

[Section 101]

Good post. I've calculated that the breakeven sale number is roughly $300 million so they're definitely looking for something above that but with your reasoning, you can make a case for Sacramento in that the price of land loan debt, roughly $68 million, MAY not be much more than what a relocation fee will be.

Like I noted, Hansen will want the loan number subtracted from the sale price whereas your deal has a new Sacramento owner taking it on. But Hansen will have to pay a relocation fee, something that a Sacramento owner wouldn't have to.

From there, the final hurdle is to get a Sacramento bid that is close to whatever Hansen is offering. I wonder if KJ has been calculating and considering all this when bringing in bids to the Maloofs?

They owe the league anywhere from $75 mil to $150 mil too.

 

[bajaden]

Good post. I've calculated that the breakeven sale number is roughly $300 million so they're definitely looking for something above that but with your reasoning, you can make a case for Sacramento in that the price of land loan debt, roughly $68 million, MAY not be much more than what a relocation fee will be.

Like I noted, Hansen will want the loan number subtracted from the sale price whereas your deal has a new Sacramento owner taking it on. But Hansen will have to pay a relocation fee, something that a Sacramento owner wouldn't have to.

From there, the final hurdle is to get a Sacramento bid that is close to whatever Hansen is offering. I wonder if KJ has been calculating and considering all this when bringing in bids to the Maloofs?

To the best of my knowledge, the league just sold the New Orleans franchise. And one of the prerequisites of the sale, was that the new owner had to commit to keeping the team in New Orleans. As a result, there were many bidders turned away. I have no idea whether the new owner had the highest bid or not, but its obvious that the league has the final say on the sale. If they want the team to remain in sacramento, then they can make that part of the deal. I'm not saying thats the case, but I do think thats the case.

I agree that the Maloofs are between a rock and a hard place. No one has even mentioned the money they've borrowed from the league. Someone mentioned the relocation fee, and that the league could impose a prohibitive fee on the Maloofs. Very unlikely! There is precedent, and if it ends up in court, precedent usually prevails. The league isn't stupid, so I sincerely doubt they would do anything that could affect a possible legal case.

 

[VF21]

Isn't part of the relocation fee a compensation to other NBA teams already in the area for what might be a negative impact on their incomes? If so, I don't really see any hope for it being too high. Then again, I'm not really that up on distances on the East coast so I'm not sure what teams would be closest to Virginia Beach. (Being a native Californian does sometimes warp a certain sense of distance since going from one town to another in California is the same as travelling through 3 or 4 states back east. )

 

[Tetsujin]

Isn't part of the relocation fee a compensation to other NBA teams already in the area for what might be a negative impact on their incomes? If so, I don't really see any hope for it being too high. Then again, I'm not really that up on distances on the East coast so I'm not sure what teams would be closest to Virginia Beach. (Being a native Californian does sometimes warp a certain sense of distance since going from one town to another in California is the same as travelling through 3 or 4 states back east. )

In between Washington and Charlotte. Washington being a couple hours away.

 

[Trueblood]

They owe the league anywhere from $75 mil to $150 mil too.

I know but that already gets cancelled out when figuring out the breakeven point. For example, the Maloofs own 52% of the team. If they sell it for $300, they wind up getting $156. If you subtract the city loan and the league loan that you're talking about, they might not even break even. That's why they are looking for something well above $300 and why we're hoping that someone with deep pockets comes to Sac's rescue.

Same with Hansen paying a relocation fee and a Sacramento owner taking on the city loan. I don't mention the money that is owed the league because either owner is going to take on that debt so it gets cancelled out. The difference becomes a relocation fee for an out of town owner and the city loan that a prospective Sacramento owner would take on in JB's scenario.

 

[Trueblood]

To the best of my knowledge, the league just sold the New Orleans franchise. And one of the prerequisites of the sale, was that the new owner had to commit to keeping the team in New Orleans. As a result, there were many bidders turned away. I have no idea whether the new owner had the highest bid or not, but its obvious that the league has the final say on the sale. If they want the team to remain in sacramento, then they can make that part of the deal. I'm not saying thats the case, but I do think thats the case.

I agree that the Maloofs are between a rock and a hard place. No one has even mentioned the money they've borrowed from the league. Someone mentioned the relocation fee, and that the league could impose a prohibitive fee on the Maloofs. Very unlikely! There is precedent, and if it ends up in court, precedent usually prevails. The league isn't stupid, so I sincerely doubt they would do anything that could affect a possible legal case.

See my above post regarding the money owed to the league.

As for the Hornets, you're right, the league was in position to make those demands about a local owner because they were the ones who owned the team and it was in their best interest to keep the team in New Orleans. Lots of people may disagree with their best interest but that's what they wanted.

With the Kings, they are unfortunately not owned by the league so the league can't set those same provisions. We all know what the Maloofs "best interest" is and it's the bottom line. This is why I keep talking about legalities. How much can the league do before the Maloofs have a good legal case? If they are getting a deal that is $100 million above what they are being offered from a Sacramento buyer AND an out of towner has no problem paying off the city loan that satisfies the lease and pays back the league, then we have to hope for the best.

I wouldn't worry about VB. We all know that Anaheim has been turned away. But we have also seen the league say that the preferred alternative to Anaheim would be for the team to go to KC if nothing can be done in Sacramento. This is why I always worry about Seattle. It's a chance for the league to remove a black eye and get guys like Hansen and Ballmer into the club. We know that's what Silver wants even if it's not Stern's preferred option. If Seattle is an option that fast tracks the Maloof's removal from the league, then we go back to my original question. Does a responsible new ownership group in a passable relocation region supercede keeping Sacramento in the ballgame, a city that the league wants to keep in the game, even though it would also keep the Maloofs in the club as well?

Regarding the arena in Seattle, Hansen is currently renegotiating the terms with the city council. It already passed the county level but the city wants some changes where Hansen would put some money into other city infrastructure needs and what not. Supposedly, there was no guaranteed that it would pass the city level under the current MOU since those terms were agreed to by an unpopular mayor and someone that many city council members want to unseat so they are making amendments. According to Hansen, the negotiations are almost over and they may fast track a vote in September via special session but again, that's coming from his camp. We all know what can happen if someone on the council is getting greased by anti arena people.

Hansen's update was from August 13th if you scoll down a bit. http://www.sonicsarena.com/

 

[Trueblood]

In between Washington and Charlotte. Washington being a couple hours away.

I wouldn't worry about Virginia Beach anymore but just for the hell of it, I was fooling around on mapquest and Virginia Beach is exactly 206 miles by car from DC. For the sake of comparing it to the league's most recent relocation, I did OKC to Dallas and it's exactly 206 as well so I'm assuming the relocation for anyone going to VB would be the same as whatever they charged OKC.

 

[Section 101]

Isn't part of the relocation fee a compensation to other NBA teams already in the area for what might be a negative impact on their incomes? If so, I don't really see any hope for it being too high. Then again, I'm not really that up on distances on the East coast so I'm not sure what teams would be closest to Virginia Beach. (Being a native Californian does sometimes warp a certain sense of distance since going from one town to another in California is the same as travelling through 3 or 4 states back east. )

That's only part of it. In the case of VC it would also cause a re alignment where another team would have to move to the western conf.

 

[Trueblood]

That's only part of it. In the case of VC it would also cause a re alignment where another team would have to move to the western conf.

It would probably be Milwaukee. They'd join Portland, Utah, Denver and Minny in the northwest with OKC most likely being the way out of place team taking Sac's spot in the pacific. Still, it's a moot point. The Kings moving to VB will be a dead story before we get to September.

 

[VF21]

In between Washington and Charlotte. Washington being a couple hours away.

Thank you.

 

[Circa_1985_Fan]

It would probably be Milwaukee. They'd join Portland, Utah, Denver and Minny in the northwest with OKC most likely being the way out of place team taking Sac's spot in the pacific. Still, it's a moot point. The Kings moving to VB will be a dead story before we get to September.

And then Seattle will be frontrunner to get the Kings, I guess. I just want this OVER! At this point, aftee being through SO much with this damn team, its stupid owners, and us Sacramentans being looked at as failing idiots ten times over as a city by everyone outside of like Davis...I'm just tired...tired of it. Just get it over with already, enough is enough...either stay or move!

 

[Kingsfan23]

How brazen some of these journalists are in coming up with these stories.. I'm reading headlines like 'Kings are expected to announce Wedsday move to Virginia Beach'... wouldn't you start out by saying that the Maloofs are possibly tallking to Virginia Beach or something lower key?

 

[Bricklayer]

How brazen some of these journalists are in coming up with these stories.. I'm reading headlines like 'Kings are expected to announce Wedsday move to Virginia Beach'... wouldn't you start out by saying that the Maloofs are possibly tallking to Virginia Beach or something lower key?

I think that could be a large part of what created this whole furor. For instance it would not surprise me at all if the Maloofs have talked to Comcast about possibilities (note the Maloofs say they have not talked to Virgiinia Beach, not that they have not talked to Comcast), and then that Comcast is planning on announcing they are involved in this development plan in Virginia Beach, and some source or the other hints at one and hints at the other...and that would have all been within the bounds of fantasy speculation. But no, this eager beaver takes whatever facts they have, mashed them together, and pitches it like its a done deal, and then Sacto fans who have exhibited a lot of stress related behavior through this whole thing spend 6 pages having meltdowns.

And maybe just maybe it happens. I can't guarantee it doesn't. We'll know in a few days. But for a variety of reasons it just can't be anything approaching as done a deal as the article says it is, and so a big bruhaha appears to get launched largely out of jouranlistic sloppiness and scoop fever.

 

[pshn80]

This morning's Bee had a very good column by Marcos Breton on this subject - Virginia Beach and the Kings. Nothing, and the absurdity of it all.

The Bee had another column on the need for the Maloofs to shoot straight with the fans and this venue. Not likely to happen now with the Maloofs and their finances with their backs against ihe wall.

 

[bajaden]

See my above post regarding the money owed to the league.

As for the Hornets, you're right, the league was in position to make those demands about a local owner because they were the ones who owned the team and it was in their best interest to keep the team in New Orleans. Lots of people may disagree with their best interest but that's what they wanted.

With the Kings, they are unfortunately not owned by the league so the league can't set those same provisions. We all know what the Maloofs "best interest" is and it's the bottom line. This is why I keep talking about legalities. How much can the league do before the Maloofs have a good legal case? If they are getting a deal that is $100 million above what they are being offered from a Sacramento buyer AND an out of towner has no problem paying off the city loan that satisfies the lease and pays back the league, then we have to hope for the best.

I wouldn't worry about VB. We all know that Anaheim has been turned away. But we have also seen the league say that the preferred alternative to Anaheim would be for the team to go to KC if nothing can be done in Sacramento. This is why I always worry about Seattle. It's a chance for the league to remove a black eye and get guys like Hansen and Ballmer into the club. We know that's what Silver wants even if it's not Stern's preferred option. If Seattle is an option that fast tracks the Maloof's removal from the league, then we go back to my original question. Does a responsible new ownership group in a passable relocation region supercede keeping Sacramento in the ballgame, a city that the league wants to keep in the game, even though it would also keep the Maloofs in the club as well?

Regarding the arena in Seattle, Hansen is currently renegotiating the terms with the city council. It already passed the county level but the city wants some changes where Hansen would put some money into other city infrastructure needs and what not. Supposedly, there was no guaranteed that it would pass the city level under the current MOU since those terms were agreed to by an unpopular mayor and someone that many city council members want to unseat so they are making amendments. According to Hansen, the negotiations are almost over and they may fast track a vote in September via special session but again, that's coming from his camp. We all know what can happen if someone on the council is getting greased by anti arena people.

Hansen's update was from August 13th if you scoll down a bit. http://www.sonicsarena.com/

I've never heard that the league said Kansas City was a good alternative to Sacramento. To be honest, I've never heard anything from the league other than what Stern said when the whole deal blew up. I certainly don't know whats in Silver's mind, as I don't remember him saying anything about sacramento one way or the other. Not saying its not true, but I've been following this thing pretty closely. The bottom line is, that the league has the final say on relocation. And they have the right to approve any sale. If someone wanting to buy the Hornets ended up bidding more than the current owner, he would have the same grounds for a lawsuit as someone bidding on the Kings. The decision is being made by the relocation committe as representives of the league, and not as owners of a team.

Maybe I'm trying to look at this through rose colored glasses. I realize it could all take a turn for the bad. So I'll continue to look for positives until I have a good reason not to. I agree that Seattle is probably the biggest threat down the road if nothing is resolved here. The only immediate threat is Kansas City, simply because they have an arena already to move into. If the Kings end up moving, then they move. I'll still follow them anyway. I've been watching the NBA since the 1950's, so I'm not going to change now. However, I hope it doesn't come to that.

I'm currently sitting in Mulege, 650 miles south of San Diego in 110 degree temps. Plus I'm on a laptop, which I hate. Maybe the heat is getting to my brain... Back home late next week!.

 

[jcassio]

I've never heard that the league said Kansas City was a good alternative to Sacramento. To be honest, I've never heard anything from the league other than what Stern said when the whole deal blew up. I certainly don't know whats in Silver's mind, as I don't remember him saying anything about sacramento one way or the other. Not saying its not true, but I've been following this thing pretty closely. The bottom line is, that the league has the final say on relocation. And they have the right to approve any sale. If someone wanting to buy the Hornets ended up bidding more than the current owner, he would have the same grounds for a lawsuit as someone bidding on the Kings. The decision is being made by the relocation committe as representives of the league, and not as owners of a team.

Maybe I'm trying to look at this through rose colored glasses. I realize it could all take a turn for the bad. So I'll continue to look for positives until I have a good reason not to. I agree that Seattle is probably the biggest threat down the road if nothing is resolved here. The only immediate threat is Kansas City, simply because they have an arena already to move into. If the Kings end up moving, then they move. I'll still follow them anyway. I've been watching the NBA since the 1950's, so I'm not going to change now. However, I hope it doesn't come to that.

I'm currently sitting in Mulege, 650 miles south of San Diego in 110 degree temps. Plus I'm on a laptop, which I hate. Maybe the heat is getting to my brain... Back home late next week!.

Are you being heroic in Mulege?

 

[bajaden]

Are you being heroic in Mulege?

Heroic? I lived in Mulege for 5 years. It is dammed hot this time of year though. However, if your a fisherman, the Dorado are running now. Pretty soon, Yellowtail when the water cools a little.

 

[Kingsfan23]

Assuming the 99% that this doesn't materialize, I think the losers in these rumors types of situations are the people of Virginia Beach, getting their hopes up for nothing.

I can imagine if a story came out in a local paper that some major financial players were coming along to build an arena for a NFL or MLB team in Sacramento, had a NFl/MLB team on board, and that it looked like a done deal... it wouldnt feel good if that were just smoke and mirrors a couple of months later

 

[Mike0476]

KJ was asked about VB:

http://www.mercurynews.com/other-sports/ci_21405127/kevin-johnson-still-hoping-keep-kings-sacramento

Even at the track, Johnson couldn't escape the subject of the Sacramento Kings and their future. With another round of rumors circulating regarding the Kings' new destination, this time Virginia Beach, Johnson indicated that the city would do what it could to keep the team in town, with or without the current owners, the Maloof family.

"We have fought very hard to keep our team in Sacramento, and we've been successful for the past two years," he said. "We're not giving up, but ultimately, it's up to the Maloofs."

 

[Mike0476]

This said all you need to know from the Virginian-Pilot:

http://hamptonroads.com/2012/08/weve-got-monarchs-so-why-not-kings-nba-fan-can-dream-cant-he

Under the Maloof brothers, the Kings are another poorly-run operation. That's not such a big surprise. Stable franchises and good owners stay put. But if you're Virginia Beach, you take what you can get.

 

[Kingster]

It's my estimation that the Maloofs are stuck. The overly generous $400 price offered for the Kings actually pens out to about $40 million in the Maloofs pockets after all the debt has been subtracted out. The Maloofs are not going to sell the team unless that offer goes a lot higher. The price tag is VERY expensive to buy the Kings and move them. There is just way too much debt involved here.

Actually sitting on the team isn't such a bad idea if they didn't like the numbers involved in the arena deal. And honestly, I can see some of the Maloofs point on the risk they face stepping into the deal as I saw it. The stinker in that deal is the debt on the existing '97 loan that has to be serviced. It has to be dealt with so that the Kings as a team (forget who owns the team for a moment) can be profitable.

My answer? I think the only way the city gets to build a new arena and keep the Kings is to relieve that '97 loan debt off the team. The problem is that the Maloofs burned so many bridges with the locals, it would never fly in discussion. So perhaps the solution is for the city to make an offer to rework the bonds and have them paid by another source arranged by the city. On one condition, that the Maloofs sell the team to owners committed to the rest of the arena deal. What that does is takes the Maloofs walk away profit from $40 million up to just over $100 million. That is about as good as any mid market team sale is going to net.

Sure that's a bitter pill to swallow. But there's bigger poison pills to swallow that involve losing the team. The only way to keep the team and get rid of the Maloofs is to pay them to leave. As it sits right now, there is not one prospective owner who can outbid Chris Hansen motivated enough to make up that gap. The city has work to do to come up with an answer before Hansen finds a way to put enough cash in the Maloofs pockets to say yes. So the pressure is on the city.

So, the NBA buys the Kings from the Maloof, under the condition that the city of Sacto forgives the loan, and under the condition that the NBA will resell to an owner that keeps team in Sacto. Easy peezy.

 

[JB_kings]

Assuming the 99% that this doesn't materialize, I think the losers in these rumors types of situations are the people of Virginia Beach, getting their hopes up for nothing.

I can imagine if a story came out in a local paper that some major financial players were coming along to build an arena for a NFL or MLB team in Sacramento, had a NFl/MLB team on board, and that it looked like a done deal... it wouldnt feel good if that were just smoke and mirrors a couple of months later

VB are not losers. They had nothing to begin with.

Those really hurt by the Maloofs courting other cities are themselves and the people who work for them. Because they are doing all this crap right in the middle of pushing for more season ticket and package sales for a season that is 100% going to be here in Sacramento. These bozos are running a shoestring operation and are desperate for every dollar. The rumors just undercut everything their ticket reps do in their jobs. If you were Sleep Train and trying to close a deal on naming rights for the arena and these jack wagons were off playing up their availability to move, you would think hard about putting your money into this situation.

It's pretty bad when even a nothing city on the other side of the country desperate for pro sports are cautious because of the Maloofs running of the Kings.

 

[kennadog]

The city CANNOT forgive the loan to the team. The money wasn't borrowed from the city in the first place. Private investors provided the money by buying city-backed bonds. The city has to get paid back or all the principle and interest due to the investors has been guranteed to be paid back by the city. We damn well better not let the Maoofs skip town and leave the city to pay the bill. I would hope the league woild not let a team default on a loan guaranteed by a city. They don't need their owners to be seen as likely deadbeats. Talk about killing the golden goose in arena financing.

Its like FHA loans to homebuyers. Private lenders loan the money, e.g. a bank, but the federal government guarantees through the FHA program that the governemt will pay the lender what's due, if the homeowner defaults. Yes, folks. All those people being foreclosed are having their loans paid off by the taxpayers, if the loan was an FHA loan.

The people in Sacramento will have to pay off the bondholders, if the Maloofs skip town without paying. I'm sure the city would sue, but that would cost loads of money and take time. In the interim the city would have to keep up the payments on the loan. They could take over the property in Natiomas and sell it, but that won't pay off the whole loan by a long shot and the land can't be built on right now, because of the moratorium.