BY Art Thiel 11:14PM 05/11/2013

Hansen’s ‘backup’ deal with Maloofs: 20% share

Chris Hansen was not grandstanding when he said he had numerous options to get the Kings from Sacramento. The latest maneuver Saturday in this unprecdented saga has the Maloof family refusing to sell to Sacramento bidders if relocation is denied, then operating the team after selling Hansen a 20 percent share for $125 million.

The “backup” tactic, first reported by ESPN.com quoting two anonymous sources, would happen only if NBA owners at a meeting Wednesday fail to allow the sale to Hansen and primary partner Steve Ballmer.

The idea is to put pressure on the Sacramento bidders to deliver on their proposed downtown arena plan, which has some NBA owners worried because of its incompleteness. But the proposed 20 percent purchase by Hansen also must be approved by NBA owners, who know clearly that his agenda is to move the club to Seattle.

The NBA would not be happy to see the cash-strapped Maloofs continue to run the Kings, but cannot force the family to sell to anyone.

In addition, the sources said Hansen’s revised tactics include paying a $115 million relocation fee to the NBA. When the Sonics moved to Oklahoma City in 2008, owner Clay Bennett paid a $30 million fee.

The latest development follows Friday’s surprise move in which Hansen upgraded his offer to value the Kings at $625 million with an additional $75 million.  The Maloofs control 65 percent, meaning they would gross $406 million on the sale.

The ESPN story says the turn of events will cause the relocation committee to reconvene ahead of the previously scheduled meeting Wednesday in Dallas. The committee two weeks earlier was said to have voted 7-0 to deny relocation, but a source told Sportspress Northwest that the actual vote was 4-3, then was pushed to make it unanimous.

The hyper-aggressive cash plays by Hansen appear to be at least forcing some rethinking. The earlier vote seemed to signal success for a counteroffer led by Silicon Valley tech billionaire Vivek Ranadive, a minority owner in the Golden State Warriors. But even the project’s biggest proponent, Sacramento mayor Kevin Johnson, warned against “dancing” because the vote was only a recommendation, not the final word from the NBA.

The counteroffer includes $258 million for the arena with the city’s parking-fee revenues, which is generating some opposition among local citizens, including an effort to gather signatures to put the city council’s approval of the deal up to a public vote.

The Maloofs have yet to agree to any deal with the Ranadive  group, or to the new arena proposal. The Maloofs walked away from a similar area deal that they announced with NBA Commissioner David Stern weeks earlier. With Hansen and Ballmer behind them as minority partners, the arena proposal would grow complex with the Maloofs remaining in charge.

The Sacramento Bee reported Saturday night that two sources close to the Ranadive  group say they are unmoved by latest moves by Hansen and the Maloofs.

“Doesn’t change our approach,” one source said. There are no plans to increase the offer. “Sacramento has made their bid and is comfortable where they are,” he said.


YourThoughts

  • Jamo57

    I beginning to think Chris Hansen is ‘a man possessed’!

    • http://twitter.com/patrick330i Patrick D

      Yeah, you are right. He is nuckin’ futs. I hope his entire ownership bid fails. What an embarrassment.

    • jafabian

      Yeah, he could teach Clay-Clay a thing or two!

  • Tom G.

    I think this hypothetical should be noted too.

    Let’s say Hansen is turned down outright (no 65%, no 20%, no 7%, no nothing).

    Then the Maloofs would go to the Vivek group and say: “Okay, put your money where your mouth is with this fancy, new arena you’re proposing. We won’t accept your $525 million offer right now. But if you pay us 20% of $600 million and then come up with the rest of the purchase price by the time YOUR arena opens, you can have 65% controlling interest.”

    If that kind of event happened, wouldn’t common sense dictate that the Maloofs would find a way to sabotage THAT arena plan in Sacramento and make it an unmitigated disaster (again)??

    I’m biased towards the Northwest here, but I just now think it’s time to pull the plug in Sacramento and bring the Sonics back to Seattle.

    • http://twitter.com/patrick330i Patrick D

      I think that is totally ridiculous. Your poaching efforts are much, much worse than what you faced with Bennett and the Okies. You guys are quickly becoming an embarrassment, and at this point, I gotta believe that Hansen and Ballmer are not engratiating themselves to the league, notwithstanding their last ditch power play. The solution is here is for the NBA to outright deny the sale to the Hansen/Ballmer group and blacklist them in a way that treats them like Larry Ellison going forward. This is not an even fight with the Kings as some random free agent team. You all are trying to loot a team. If you are successful, this will be remembered for a long time and you all will be hated for it in a lot of places. I am not from WA or CA.

      • Tom G.

        Blame your pals the Maloofs for selling Sacramento out the way they are and blame Stern for not extended an expansion olive branch.

        We lost our team 5 years ago while living in a similar environment. And unfortunately, this is the same environment Seattle will have to navigate through to get our team back.

      • Jared S.

        Your poaching efforts are much, much worse than what you faced with Bennett and the Okies.

        Er, no. They’re not even worse than the Sacramento group that brought the Kings there in the first place:

        http://deadspin.com/5978111/a-history-lesson-for-sacramento-how-kansas-city-lost-the-kings

        And I doubt the owners would be too outraged by Hansen and Ballmer offering to give them more and more money (both directly and indirectly). I also doubt the rest of the county cares that much about this situation (although ESPN polls have been pretty one-sided in favor of the team moving to Seattle, which I found a bit surprising).

        If you must vent outrage, do so at the NBA for ripping the Sonics out of Seattle and (so far) refusing to consider expansion. That’s what led to this situation.

      • MWH

        I am fascinated by the assertions that I have heard from the SAC side that the action of Hanson and Ballmer or “pissing” off the NBA owners and will get them blacklisted? Please explain this in more detail… There are no blacklists in business. Someone aggressively bidding up a product is a good problem to have and in fact one that is important.

        If you are on the SAC side of this deal I can see how an aggressive counter move would piss you off..

        Aside from the tweet from the Heat owner that was directed directed to the person who originally contacted him and not HB. explain to me the rational why an owner would be pissed off?

      • inplaylose

        this is how this game is played. it has been played this way across the continent for a century. it is not pretty. it isn’t supposed to be. this is all about big business by millionaires with the occasional would-be kingpin politician thrown in making promises they often cannot keep.

        no one in Seattle made the rules, and the fact is that the NBA left Seattle biz interests little to no choice but to go this route. if you want to blame Hansen, go ahead. but this sort of situation will almost certainly happen again. it is a systemic failure. hate the game and not the player.

      • einsteinstoe

        Yeah sucks for you Patrick D. Hansen/Balmer = $Boss$
        Unlike the blatant lies of Shultz/Bennett that created the Zombie Sonics, Hansen has been CRYSTAL CLEAR from day one. Cash is King, and this is business.Tough stuff as the business of the NBA mixes with the emotions of die hard fans.

  • Zen Moment

    I think Hansen believes that it is “now or never” — and he is probably right.

    • Tom G.

      Well, right NOW, there’s only 1 team available.

      The NBA will not throw out an expansion olive branch to anyone.

      So Hansen needs to make a full court press NOW for the Sacramento Kings.

    • einsteinstoe

      I think your right Zen Moment…..there is a real likelihood that political forces in Seattle could turn on HB if too much time passes.

  • seattlenative57

    This drama just keeps getting better and better. Stern must be beside himself.

  • seattlenative57

    Hansen’s strategy appears to be to provide the NBA the proverbial deal they can’t refuse.

  • PokeyPuffy

    interesting that this is so public, one might think this kind of info gets leaked in backroom discussions amongst the higher ups, but not so overtly as is the case here. HBN communication/coordination with NBA seems minimal, hopefully they have their ducks in a row with the owners….

  • OffTheLows

    The lesson learned in getting a NBA team relocated is to use the now patented Clay Bennett Method.. which would be buying the team claiming an intent to stay, gut the roster, do nothing to promote the team, demand a 100% taxpayer funded Taj Mahal arena at a cost of at least $600m, and when the city refuses, move the team to desired location, even if that location is 1/3 the population of the place you want to leave in the Bennett case. Hansen could have saved $150 million using the Bennett Method, never mind what Ballmer could have saved had he bought the team before Bennett got his hands on it.

  • Will

    The great irony is, Las Vegas Lenny, Ouija Boards, tea leaves and tarot card have consistently predicted the NBA is in trouble and will become a shell of its former self within 10 years. Hansen is offering dollars and will get pennies in return … if he’s lucky.

    • MWH

      So what you are saying is that HB are business idiots throwing money around.. More concerned about ego than making a profit? I have not read the HB business plan but I believe that they are all aware of the risks.

  • MWH

    I am beginning to wonder if this deal went down something like.

    A year ago when the Maloof family backed out of the Sacramento arena deal feel through and the situation with the kings regressed back to status quo with a cash poor owner. Stern was faced with the following problem; A community with both passionate fans and strong political support but lacking an ownership group this is willing to sell and a local ownership group to step up and purchase the team. He also knew of Hanson, Ballmer and the city of Seattle’s desire to bring back the Sonics.

    How does he solve this problem? Simple.. Cultivate the relationship between the Maloofs and HB to create a compelling offer to sell and relocate kings to Seattle. Then use that offer as motivation to assemble a local ownership group that will create a comparably compelling “same ballpark” offer and couple that with the arena deal from the year before, throw in a couple of concessions that will put more money in the pockets of the other owners. Then manipulate the sale and relocation process to focus on Article 7 of the NBA bylaws to block the sale to HB forcing the cash starved Maloofs will sell to the local ownership group.
    Problem solved..

    In Sterns mind, this plan worked.. In fact two weeks ago after the 7-0 vote he claimed victory multiple times on national TV. I think that he expected HB to bow out gracefully take the high road and wait for something later.. Hey he could execute the same play in a couple of years using Milwaukee right?

    The moves of the last couple of days feels like the moves that Ballmer made during Microsoft’s peek years. Bold, aggressive and decisive.. this is the classic BIG BET. Is it dirty business? not at all it unequivocally boils the problem down to dollars and cents and the amount of money that can be made in one market vs the other.
    I am glad that HB and the Maloofs punched back the way that they did..
    The cards are on the table.. let the owners decide..

  • jafabian

    The BOG needs to look at the whole picture. All KJ is in all this is the mayor of Sacramento. When all is said and done he won’t be involved in day-to-day operations. What kind of owner will Ranadive be? Sure he’s been a minority owner of the Warriors but what has that meant? And just what have the Warriors done over the years? After their championship in 1974 they’ve had a couple good runs but overall they’ve never even returned to the Western Conference Finals.

    Hansen has shown a passion, a shrewdness and an intelligence that stands out even among the current owners. He’s been PATIENTLY working this since 2011. He’s kept to his own counsel even when Sterno undermined him. He’d be a credit to the league and wouldn’t just be a Donald Sterling type of owner where he just throws out a cheap team onto the floor and write it off. He’s in it to win it.