Goodbye, Power Balance Pavilion. Hello, Sleep Train Arena.
The Sacramento Kings and Sleep Train Mattress Centers announced Monday they have signed a five-year deal to rename the team's Natomas arena for the West Coast bedding chain.
Dale Carlsen, founder and CEO of Sleep Train, based in Rocklin, said the deal will boost his company's community profile and possibly help solidify the team's uncertain standing in Sacramento.
"We're hopeful they'll be here a long time," said Carlsen, a season ticket holder for 25 years.
The deal contains an insurance policy in case that doesn't happen, however. Carlsen said Sleep Train has the option to end the contract or renegotiate if the Kings decide to leave Sacramento within the five-year period.
Kings officials expressed delight Monday over their team's new sponsor.
"We're very thrilled to be partnering with (Carlsen) ... he's a legend," said Matina Kolokotronis, the Kings' president of business operations. "It's quite a wonderful day for our organization."
The arena name change takes place immediately, although signage won't go up until November.
The name Sleep Train Arena generated immediate jokes on the Internet. Scott Shafer of KQED radio in San Francisco posted on Twitter: "This seems ready made for jokes if the team slides into a deep sleep."
But marketing consultants said the Kings' new partner would be a significant upgrade from Power Balance, a sports-wristband marketer that filed for bankruptcy protection after getting hit with a slew of consumer lawsuits about its products.
"Sleep Train is a quality company," said Andy Dolich, a sports-business consultant in the Bay Area and former executive with several NBA teams.
Kolokotronis lauded Sleep Train, which operates more than 250 stores, as a company with a "stellar reputation among consumers and business leaders, and an unwavering commitment to community involvement."
The announcement represents a public relations boost for the team, weeks before what could be a critical season financially for the beleaguered franchise.
Team officials had been scouring for a replacement sponsor since Power Balance filed in bankruptcy court and cut short its marketing agreement less than a year after its name went up on the arena.
"We wanted to have a naming rights deal" in place for the start of the season, Kolokotronis said. "It's a very important part of a franchise."
It's unclear, though, how much of a boost the deal brings to the team's financial bottom line. Kolokotronis and Carlsen refused to discuss dollar amounts, but Kolokotronis said the deal is "very fair and very competitive."
NBA teams typically get from $2 million to $10 million a year from their naming-rights deals.
E.J. Narcise of Team Services LLC, a national sports-marketing consulting firm, said the Kings' price tag likely is depressed due to the advanced age of the arena and the ongoing uncertainty about whether the team owners will move the team out of town.
"I think it would be a stretch to think they could get to $2 million (a year)," Narcise said.
Power Balance was supposed to pay the team $975,000 in the first year of its agreement, but the wristband company had paid only $700,000 at the time of its bankruptcy filing. The deal was supposed to ramp up to $2.3 million in the fifth year.
Arco, which had the naming rights for 25 years, paid the Kings a reported $750,000 a year.
The Maloof family, which owns the team, had attempted to move the Kings to Anaheim in 2011 but were persuaded by NBA officials to stay in Sacramento at least a year to give the city time to propose a deal to build a new arena.
In April, the Maloofs rejected a plan by Mayor Kevin Johnson, and backed financially by the NBA, to build a $390 million downtown arena. The team owners have kept mostly quiet since then, other than saying they remain committed to Sacramento.
The Sleep Train deal includes joint community outreach work, and gives the mattress company marketing visibility for concerts, family-themed shows and cultural experiences at the arena, as well as NBA basketball games.
For Sleep Train, the agreement represents its third entertainment venue naming rights deal. The company name is also on the Sleep Train Amphitheatre concert venue near Wheatland and Sleep Train Pavilion in Concord.
Company CEO Carlsen downplayed the recent local furor over the Kings' rejection of the arena deal, saying the naming rights will allow his company to play a larger role in the community. Carlsen said the deal includes opportunities to bring hundreds of foster children to games and events.
"When push comes to shove, it's (for) the community and the kids," he said.
While the Kings gained a significant new sponsor in Sleep Train, the team appears about to lose another key financial partner. A representative of Thunder Valley Casino in Lincoln said his company has decided not to re-up as a Kings sponsor. The casino reportedly committed $1 million as a sponsor last year.
Spokesman Doug Elmets said the casino will keep its suite at the arena but has decided to focus its advertising dollars elsewhere. Kolokotronis, however, said negotiations are "ongoing" with Thunder Valley.