Sacramento Kings sold to Seattle?

[bloatedmaniac]

So what happens to the debt to the city if it's sold to local buyers? Is it waived? If so, is that a good thing, to waive $175M?

I thought the Kings owed only about $70M to the city and $100-$200M to the NBA?


Or are the Maloofs still responsible if it's sold to local buyers? If so, doesn't that make it an even easier decision to sell to Seattle? Would they rather have $525M with $175M going to pay off loans, or $350M and still have to pay loans?

The Maloofs owe $77M to the city, not $175. In any sale to the local buyer, the loan would be assumed by them, and not waived. That is far too much money for the city to walk away from without any reinversement.

They owe the NBA itself well over $100M though which will not be factored into the deal.

The problem is...from everything KJ has said...it doesn't seem like they have a local buyer set yet. Time is short, the NBA won't stall the deal forever. If they don't have anything set within the week the team is gone.

[Sir Harry]

The way I understand it the Maloofs will have to pay 77 million to the city and either 121 million to the NBA (from loans) or credit the new buyer back that 121 million.
Also, please remember that the Maloofs are not receiving 525 million for the Team, they are receiving 42% of 525 million or roughly 220 million with other co-owners receiving 23% or roughly 120 million.....and that is before you subtract their liabilities.

In theory a local group should be able to match the Ballmer offer with 264 million if they don't have to pay back the City their 77 million, but then again the local buyer would be assuming that loan, so not sure how that translates the bottomline

[ctbaz]

I just don't see how the NBA can let them leave with an arena deal already approved and owners that would keep the Kings in Sacramento. That has never happened in a relocation. If they really do care about small market teams they can't let the Kings move.

[Eze]

Somebody is going to get a raw deal. Hard to see them screwing Sacramento, as you said, but then again, hard to see them screwing Seattle twice.

Going to guess the first big mistake is going to kill the deal for one side.

[nuraman00]

The Maloofs owe $77M to the city, not $175. In any sale to the local buyer, the loan would be assumed by them, and not waived. That is far too much money for the city to walk away from without any reinversement.

They owe the NBA itself well over $100M though which will not be factored into the deal.

The problem is...from everything KJ has said...it doesn't seem like they have a local buyer set yet. Time is short, the NBA won't stall the deal forever. If they don't have anything set within the week the team is gone.

You think they need something within a week?

It's not good enough to get it done just before the Board of Governors meeting?

So again, doesn't that give them all the more reason to sell to the Seattle group?

Either Maloofs + Hernreich get $350M and Maloofs pay off loan with it, or they get $525M and use that money to pay off the loan. Right?

[nuraman00]

The way I understand it the Maloofs will have to pay 77 million to the city and either 121 million to the NBA (from loans) or credit the new buyer back that 121 million.
Also, please remember that the Maloofs are not receiving 525 million for the Team, they are receiving 42% of 525 million or roughly 220 million with other co-owners receiving 23% or roughly 120 million.....and that is before you subtract their liabilities.

In theory a local group should be able to match the Ballmer offer with 264 million if they don't have to pay back the City their 77 million, but then again the local buyer would be assuming that loan, so not sure how that translates the bottomline

Ok.

The way I understand it the Maloofs will have to pay 77 million to the city and either 121 million to the NBA (from loans) or credit the new buyer back that 121 million.

Also, please remember that the Maloofs are not receiving 525 million for the Team, they are receiving 42% of 525 million or roughly 220 million with other co-owners receiving 23% or roughly 120 million.....and that is before you subtract their liabilities.

Isn't it Maloofs receive 52% of $525M, Bob Hernreich receives 12% of 525M?

[bloatedmaniac]

The way I understand it the Maloofs will have to pay 77 million to the city and either 121 million to the NBA (from loans) or credit the new buyer back that 121 million.
Also, please remember that the Maloofs are not receiving 525 million for the Team, they are receiving 42% of 525 million or roughly 220 million with other co-owners receiving 23% or roughly 120 million.....and that is before you subtract their liabilities.

In theory a local group should be able to match the Ballmer offer with 264 million if they don't have to pay back the City their 77 million, but then again the local buyer would be assuming that loan, so not sure how that translates the bottomline

When presenting the case to the league, you can't downsive that much. You have to factor in the 12% minority stake that is up for sale too. 65% of the team was sold with the 35% minority share that wasn't for sale getting nothing. So if the new owners swallow the city loan, they still need to come up with $425M. Thats the minimum the new ownership group would have to give. Kevin Johnson even stated this already as their target point. Anything less and the league would reject as a gross devaluation as the sell price.

[bloatedmaniac]

You think they need something within a week?

It's not good enough to get it done just before the Board of Governors meeting?

So again, doesn't that give them all the more reason to sell to the Seattle group?

Either Maloofs + Hernreich get $350M and Maloofs pay off loan with it, or they get $525M and use that money to pay off the loan. Right?

Yes they need all details ironed out before they meet with the Board of Governors. They need a bonafide and realistic plan to cause the deal to collapse. Seattle has before March 1st to file for relocation. They'll be pushing the league to be able to do so asap. That pressures Sacramento to have their meeting very very soon. If they delay, the league won't wait. They want the situation handled as soon as possible. If KJ and company are not ready, Sacramento losses by default.

[Eze]

Yeah, KJ was to go to the inauguration today but canceled to work on the Kings stuff - they're rushing.

[Sir Harry]

When presenting the case to the league, you can't downsive that much. You have to factor in the 12% minority stake that is up for sale too. 65% of the team was sold with the 35% minority share that wasn't for sale getting nothing. So if the new owners swallow the city loan, they still need to come up with $425M. Thats the minimum the new ownership group would have to give. Kevin Johnson even stated this already as their target point. Anything less and the league would reject as a gross devaluation as the sell price.

Not the way I understand it, only 65% of the team is offered for sale. The 525 million number is the teams 100% overall valuation according to the Hansen group. They are not going to pay 525 plus eat all the loans for a team they estimate to be worth 525 (which is already way overvalued)

[bloatedmaniac]

Not the way I understand it, only 65% of the team is offered for sale. The 525 million number is the teams 100% overall valuation according to the Hansen group. They are not going to pay 525 plus eat all the loans for a team they estimate to be worth 525 (which is already way overvalued)

The Hansen group did not agree to eat any loan for the Kings outside of forwarding the $30M deposit next month. It seems you are very right about the 65% part.

"Following this come reports other teams have been notified of a sale, something PBT can confirm. The sale price is $525 million of which the new owners will get 65 percent."

At that rate....yes you can give that total amount as you previously stated. I think they still need to say $425M as the target point, but then you only pay X amount for the 65% after assuming the city loan.

[nuraman00]

The Hansen group did not agree to eat any loan for the Kings outside of forwarding the $30M deposit next month. It seems you are very right about the 65% part.

"Following this come reports other teams have been notified of a sale, something PBT can confirm. The sale price is $525 million of which the new owners will get 65 percent."

At that rate....yes you can give that total amount as you previously stated. I think they still need to say $425M as the target point, but then you only pay X amount for the 65% after assuming the city loan.

So in a sense, aren't either set of new owners "paying" for the loan?

Either local buyers pay $425 M (example -- take 65% of that, $276.25M ), and then have to pay back the loan.

Or, Seattle group buys for $525M (65% of that is $341.25M), some of which goes to the Maloofs which they will use to pay off the loan. Of course, I doubt they'd pay off the loan all at once, but just continue to make regular payments.

341.25 - 276.25 = $65M, so the difference does seem about right. The Seattle group is "paying" for the loan with that extra money.

[ctbaz]

Somebody is going to get a raw deal. Hard to see them screwing Sacramento, as you said, but then again, hard to see them screwing Seattle twice.

Going to guess the first big mistake is going to kill the deal for one side.

If they screw Sacramento it would be 10x worse than what happened to Seattle the first time.

Seattle fucked up the first time by giving the middle finger to Bennett for an arena. Because of that Bennett was allowed to move the team. I just don't see how if an arena deal is there and owners to keep the team in sacramento why the NBA would allow a move.

I find it odd that the Maloofs didn't try to find a local owner or at least publicize that the Kings were for sale. Why the fuck didn't the NBA give the hornets to Seattle when they were for sale last year?

Seattle fucked up the first time by no agreeing to an arena. Sacramento hasn't fucked up. The Maloofs did and now less than a year later they are selling to a group that wants to move the team? IT's fucked up if the NBA allows it.

[Eze]

If they screw Sacramento it would be 10x worse than what happened to Seattle the first time.

Seattle fucked up the first time by giving the middle finger to Bennett for an arena. Because of that Bennett was allowed to move the team. I just don't see how if an arena deal is there and owners to keep the team in sacramento why the NBA would allow a move.

I find it odd that the Maloofs didn't try to find a local owner or at least publicize that the Kings were for sale. Why the fuck didn't the NBA give the hornets to Seattle when they were for sale last year?

Seattle fucked up the first time by no agreeing to an arena. Sacramento hasn't fucked up. The Maloofs did and now less than a year later they are selling to a group that wants to move the team? IT's fucked up if the NBA allows it.

Yeah, but, I don't think they care - not that I don't agree with you.

The rumored deal though is insane for the Maloofs. I understand why they did it - dickheaded as it is. They found a willing sucker - it's the sweetheart deal they've wanted for so long.

[Eze]

Some stuff popping up about the minority owners - is it true that they have first shot at buying the Maloofs share of Kings? That could be interesting, given a couple of the minority owners have said they want to keep the Kings in Sac. Maybe that's what KJ is putting together - those owners with more money from larger sources who'll own the majority.

[Eze]

Yup - minority owners have first right to match offer. Guessing that's KJ's weapon in his back pocket. Team them with a big name owner - they don't care where the money comes from, just as long as its enough to match the offer.

[nuraman00]

If they screw Sacramento it would be 10x worse than what happened to Seattle the first time.

Seattle fucked up the first time by giving the middle finger to Bennett for an arena. Because of that Bennett was allowed to move the team. I just don't see how if an arena deal is there and owners to keep the team in sacramento why the NBA would allow a move.

I find it odd that the Maloofs didn't try to find a local owner or at least publicize that the Kings were for sale. Why the fuck didn't the NBA give the hornets to Seattle when they were for sale last year?

Seattle fucked up the first time by no agreeing to an arena. Sacramento hasn't fucked up. The Maloofs did and now less than a year later they are selling to a group that wants to move the team? IT's fucked up if the NBA allows it.

What you're saying makes sense.

But business doesn't operate by logic or rationale IMO. That's what I'm afraid of.

And I just think that having the sale to Seattle is a stronger binding thing than trying to overturn it.

[nuraman00]

So in a sense, aren't either set of new owners "paying" for the loan?

Either local buyers pay $425 M (example -- take 65% of that, $276.25M ), and then have to pay back the loan.

Or, Seattle group buys for $525M (65% of that is $341.25M), some of which goes to the Maloofs which they will use to pay off the loan. Of course, I doubt they'd pay off the loan all at once, but just continue to make regular payments.

341.25 - 276.25 = $65M, so the difference does seem about right. The Seattle group is "paying" for the loan with that extra money.

Bump? Do these figures seem about right?

[nuraman00]

Well, the first step for anything to happen is for the big money guys to step up and commit to Mayor Johnson with the money.

They've been talking for years about wanting to own a team. Well now they have to make some kind of a commitment.

Burkle, Mastrov, Carlsen, Larry Ellison, Kings minority owners (Benvenuti?), whoever.

I don't think some of those guys are as serious as they sound, I think they want a good deal of their own, but we'll see.

[nuraman00]

Yeah, but, I don't think they care - not that I don't agree with you.

The rumored deal though is insane for the Maloofs. I understand why they did it - dickheaded as it is. They found a willing sucker - it's the sweetheart deal they've wanted for so long.

Yeah, I don't think they care. It's about getting the best deal for the Board Of Governors, and Seattle has the edge in market size, luxury boxes at the new arena, and TV deals.