Tag: Larry Ellison

Oklahoma City Thunder v Memphis Grizzlies - Game Six

Of course Michael Heisley is in talks with Larry Ellison, things were going too well


Best season in franchise history from an overall success and excitement standpoint. First playoff game victory. First playoff series victory. Significant improvements in fan interest and long-term viability of on-court production. Things have been going really well in Memphis, Tennessee when it comes to the Grizzlies.

So, of course, this is happening. From the Memphis Commercial-Appeal:

Californian Larry Ellison, ranked as the third-richest person in the U.S., has inquired about buying the Memphis Grizzlies with apparent hopes of moving the team to San Jose.

But team owner Michael Heisley today downplayed the possibility of a sale — and of a relocation, citing a lease that ties the franchise to Memphis and FedExForum until 2021.

“I can’t downplay it enough. If it happens I’ll be surprised,” said Heisley, a Chicago-based billionaire who added that talks had not become serious. “It’s in the initial stages. We’ve handled this just like we’ve handled several other dozen requests. My situation in Memphis has not changed a lick. My preference will always be for somebody in Memphis to buy the team. There’s not any interest in Memphis. But we’ve always made it known that if somebody wants to buy the team, we’ll listen. If they’re real buyers we’ll probably be sellers. So far there hasn’t been anyone willing to buy the team under my terms and for my price.”

via Oracle Corp.’s Ellison inquires about buying Grizzlies; Heisley downplays possibility » The Commercial Appeal.

I’m not trying to be a negative nellie here, but that to me reads as “I can’t downplay it enough. I want to sell it to someone who doesn’t exist, and this person that does exist and will move the team and has been desperate to get a team for two years is interested, but seriously, no worries.”

Yeah, that’s not good for the Grizzlies sticking around.

If you want more proof — Matt Steinmetz of CSNBayArea.com reports the talks are in an “advanced stage.” Heisley and Ellison may already have a “handshake agreement” according to the report. This just does not look good at all.

Heisley has been consistent in saying he wants to sell. He has resisted investing in a losing team, which you can’t really blame him for. He’s finally put his money where his mouth is in the past year and a half though, handing out contracts to Mike Conley, Rudy Gay, Zach Randolph and Marc Gasol. He recently traded Sam Young for a player not playing in the NBA to avoid the luxury tax. Finances are on the guy’s mind and Memphis is a hard town to pull profit in.

Ellison on the other hand made a swing for the Hornets last year but was rebuffed. If you want some political intrigue, the California teams are wary of another team moving into their markets, especially the Warriors.

Heisley is on record as saying this isn’t a big deal. I can’t stress that enough. He said this isn’t the first pitch Ellison has made, and that there are other suitors, with one matching his $350 million price tag on the team. It’s just concerning because the more Memphis wins, the better value they are for a seller, and while many fans think Memphis is unworthy of having a team, they’ve responded to the Grizz being competitive and “tough” like the town is. Losing them to yet another California zipcode (making it five teams in one state) seems unfortunate for basketball coast to coast.

(HT: Inside Hoops)

The NBA’s Anaheim Kings? Come, connect the dots with us.

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With the latest stadium deal now dead in Sacramento, it doesn’t take much to get people in certain other markets dreaming of the NBA in their home town. Pictures of DeMarcus Cousins dominating in the paint and Tyreke Evans getting treatment for plantar fasciitis in their city fill the minds of young children with NBA dreams.

Along those lines, interesting article in the Orange Country Register Monday connecting the dots between the Sacramento Kings owners, Joe and Gavin Maloof, and the Honda Center in Anaheim. Or the HP Pavilion in San Jose.

The relocation rumors revved up again Friday when Bloomberg News Service reported that two private investment firms are negotiating to acquire a controlling interest in the Palms Casino Resort in Las Vegas, also owned by the Maloofs, after the family violated its loan covenants.

If the Maloofs are having significant financial problems — the Sacramento Bee reports that in 2009 the family sold its original beer distributorship in New Mexico for more than $100 million and that there also were staff layoffs in the Kings organization and at The Palms — then perhaps there is a greater sense of urgency to move the franchise to a market with better demographics, more potential corporate sponsors and an NBA-ready arena.

That’s where Anaheim comes in. If the Maloofs decide to move the Kings — or are forced to sell a team struggling on the court (NBA-worst 8-25 record) and struggling at the gate (29th out of 30 in home attendance) — Anaheim and San Jose are believed to be the most likely destinations because they both have NBA-quality arenas and waiting billionaires to help them overcome financial obstacles.

The billionaire in San Jose is Larry Ellison, he of Oracle and trying to buy the Warriors and Hornets.

In Anaheim that is Henry Samueli, the owner of the NHL’s Anaheim Ducks and the guy booking the Honda Center. He is one of the co-founders of Broadcom and while his net worth has taken a tumble in this economy he is still worth an estimated $1.7 billion according to Forbes. Which wouldn’t suck.

Samueli has said he would love an NBA team in the building. He helps the Maloofs out financially with a partial ownership stake, they get a good arena deal at the Honda Center and… there are some dots.

We’re a long way from being able to connect all of them. The financial situation of the Maloofs may be overstated, for one. Times are not good in Vegas but we don’t know the details.  More importantly, at least publicly the Maloofs are not trying to move out of Sacramento.

But if the time comes — and it might — those dots might start to fill in.

Larry Ellison says he tried to buy Hornets

Detroit Pistons v New Orleans Hornets
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Larry Ellison — founder of Oracle and one of the richest men walking the planet — lost out on his bid to buy the Golden State Warriors last year. (Actually, his bid might have won but it was submitted after the deadline.)

He still wants an NBA team and recently tried to buy the New Orleans Hornets, he told the San Jose Mercury News (via CBS Facts & Rumors):

“I did offer $350 million” for the New Orleans Hornets, Ellison told reporters, adding that he was “slightly outbid” by the National Basketball Association when the league bought the bankrupt team last month from owners George Shinn and Gary Chouest.

It had been assumed that the league bought the team because nobody else stepped forward with a legitimate offer.

Someone did — Ellison. But not the right someone. He likely would have moved the team out of New Orleans to San Jose, a rumor that Forbes had published.

The league wants to make an effort — or at least appear to make an effort — to keep the team in New Orleans. Selling to Ellison would have come off as giving up on the city and that would have been bad PR.

It would not be a shock if whoever buys the Hornets from the league decides move the team to Kansas City or some other market. Even San Jose. But for now it’s about giving New Orleans a chance, and making sure everyone sees how hard you are trying to keep the team there. Not that there won’t still be an outcry if/when the team moves, but at least the league can say it did its best before screwing another fan base.

New Warriors owners not sure how they outbid Larry Ellison either

Joe Lacob, Peter Guber
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There was a given going into the sale of the Warriors — if he wanted the team, Silicon Valley mogul Larry Ellison could win the auction. Easy. You know how rich Nets owner Mikhail Prokhorov is? Trail Blazer owner Paul Allen (he of the ground floor of Microsoft)? Ellison is worth more than both of them combined.

And it was assumed Larry Ellison wanted the Warriors, he had expressed interest before.

But at the end of the bidding, Joseph Lacob and Peter Guber came out with the team after a $450 million bid. NBA.com’s Scott Howard Cooper asked them how that happened, and, well, they don’t know either.

“We heard all that too, and we even thought that,” Lacob admitted, laughing. “I remember Peter and I talking about this during the process. We said, ‘We can’t really worry about him. We just have to do what we think is right. We have to do our homework, we have to bid at the appropriate time, we have to bid the right amount, we have to do our due diligence properly, and we just stay in the game because you never know what’s going to happen….”

“The truth is, in the end, who’s to say why. Larry could have had the team probably at any time by just writing a bigger check. And he certainly could afford to do that. I really don’t know why he didn’t do that. Maybe it’s one of these things where you just don’t think the other guys are real in a bidding process. We were a little bit under the radar. We just stayed in there and did our thing. I guess the one thing I would say is that when it came down to it and we knew we had it, or were very close to having it, we did do one thing that was rather unusual. We signed a letter of intent. Then it usually takes a couple months to do what’s called a complete purchase-and-sale agreement. We went and did that in a period of about 72 hours. Completely. Nonstop. Without sleeping. With our lawyers. We knew that they, or he, or whoever – we didn’t know who the competitor was – would try to come in over the top at the end. It’s an auction process. We just said, ‘We’re going to be done before they ever get there.’

Ellison did try to come in with a bigger offer after the bidding process ended, but that didn’t work. Selling owner Chris Cohan stuck with his process. And there you go.

We don’t know how good Lacob and Guber will turn out to be as owners. Better than Cohan, one could hope (one playoff appearance in 16 years). Owners who stuck with a plan and beat the big gun out sound like just the perfect guys to take over in the Bay Area.

Pistons about to sell for less than Warriors

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Thumbnail image for pistons_logo.pngLast December, Forbes estimated the value of the Golden State Warriors at $315 million, yet when the team hit the open market, it sold for a record $450 million (although that deal has yet to be finalized).

So with the Detroit Pistons valued at $479 million, they should sell for…

Nope. They are not going to go for in excess of $500 million and may well sell for less than the Golden State price, according to Crain’s Detroit Business publication.

The bank hired to broker a sale of the Detroit Pistons and Palace Sports & Entertainment Inc. is seeking $500 million from potential buyers — a price industry insiders and likely bidders consider inflated by $100 million in this market, a source familiar with the situation said…

“Today, with the financial uncertainty, the tremendous dislocation of the Michigan economy, that would be an extraordinary price to be achieved,” Marc Ganis, president of Chicago-based sports consulting firm Sportscorp Ltd. “If it were two years ago, maybe.”

A few things are in play here. First is the regional economies — the Bay Area remains the heart of the technology industries in America and as such has a lot of money flowing around. Bluntly — there are a lot of rich people in the Bay Area right now. Michigan, still home of America’s car culture, is being hit hard right now. This is not the area for big sponsors or tons of people with extra disposable income.

Second, the Golden State price got inflated as insanely wealthy Larry Ellison was involved in the bidding, so groups that wanted to outbid him knew they had to go big or go home.

On the other hand, one of the key bidders for the Pistons is Mike Ilitch, who already owns the Tigers and Red Wings, so he knows the Detroit market well. And remember earlier this year he hired Tom Wilson, the longtime Palace Sports and Entertainment president (that’s the company set up by the late Bill Davidson to run the Pistons). So Ilitch knows exactly what the Pistons take in and expend.

Karen Davison, Bill’s wife who now owns the Pistons, is not going to lose money on this sale — Bill bought the team for $8 million in 1974. But she may make $100 million less than she hoped, as well.