The long-discussed NBA league purchase of the New Orleans Hornets got the final rubber stamp of approval when the Board of Governors — you know, the other owners, the ones footing the bill — agreed to purchase the team, the league announced today.
It now falls to Jac Sperling to find a buyer while Hugh Webber will essentially continue to run the team. Sperling — an executive with the NHL’s Minnesota Wild and the guy who brokered the sale of the NHL’s Ducks — said the goal is to find an owner or owners who want to keep the team in New Orleans. The league is already negotiating with the state of Louisiana — the owners of the New Orleans Arena — to find a better lease deal from the team.
However, this is a team expected to lose millions this season and was already $83 million in debt as of a couple of years ago. A team that has struggled to find the corporate sponsors and suite buyers — the rich people for the expensive seats — that are the lifeblood of NBA franchises now. So finding a local owner or keeping the team in the Big Easy will be a monumental challenge.
But now the game is officially on.
Yesterday rumors surfaced of David Filo — New Orleans native and insanely rich founder of Yahoo — was interested in buying the team and keeping them in the Big Easy.
Not so fast. Yahoo officially denies that he is buying the team, according to Tom Ziller of SB Nation. A company spokesman denied the report. Frankly I don’t know if I trust the original rumor or a PR person less in this case, so pick your poison on what is reality.
The question really becomes who? If not Filo, who? What New Orleans personality with the money is going to step forward and spend $300 million (give or take) to get the team. Filo was the first and only name to surface, although you can bet Jac Sperling is working hard to find someone or someones.
Meanwhile, the sharks are circling — there are plenty of investors interested if they can move the team.
This is starting to remind me of the bank bailouts, where once the government decided to help them out the depth of the morass just kept becoming clearer.
The Hornets lost $18.24 million dollars in 2009-10, according to Jonathan Abrams at the New York Times Off The Dribble blog. And the numbers after this season should be even worse (which is a little sad because the team is better this season, last season if nobody wanted to watch them it was understandable).
That is just operating losses, we’re not figuring in the long-term debt, which at last count was about $83 million.
It was those losses that had George Shinn trying to sell the team and that forced the league to step in and buy the franchise when a deal with Gary Chouest fell through.
David Stern and Jac Sperling — Sterns appointed man to run the team — have both said they want to take their time, do it right and find a local owner if at all possible. But once the other 29 owners start having to write checks that cover those operating losses you can count on there being pressure to speed up the process.