The Sacramento Kings, the woebegone franchise that became the object of one of the least likely bidding wars in sports history, will probably stay put instead of moving to Seattle.
A powerful committee of NBA team owners on Monday rejected the Kings' proposed relocation to the Pacific Northwest. The unanimous 7-0 vote by the league's relocation committee could kill the $357 million deal the Maloof family struck to sell the team to investors from Seattle. It sets up a final decision in mid-May by the league's board of governors, consisting of all 30 team owners.
While clearly elated, Sacramento Mayor Kevin Johnson was careful not to declare victory at a press conference attended by cheering fans at Firestone Public House in midtown.
"It is not over yet," said the former NBA star, who lobbied league executives relentlessly to keep the Kings in town. "I feel like we have won a round in the playoffs. There is still work to be done. We do not want to dance in the end zone."
NBA Commissioner David Stern told an NBA TV reporter at a playoff game in Atlanta late Monday that he was surprised the vote was unanimous, but added, "They decided as strong as the Seattle bid was, and it was very strong, there's some benefit that should be given to a city that has supported us for so long and has stepped up to contribute to build a new building as well."
He said the full board's vote would come May 15.
Amid the celebration in Sacramento Monday, it remained unclear whether the Maloofs, thwarted by their fellow owners, would accept the backup offer from a group of investors angling to keep the Kings in Sacramento. The family had no comment on the committee vote.
Two weeks ago, in their last public statement on the matter, the Maloofs told the NBA that the bid from the Sacramento group – led by software tycoon Vivek Ranadive – was inferior. Ranadive's group is offering $341 million, or $16 million less than the recently sweetened bid from Seattle's investors, hedge fund manager Chris Hansen and Microsoft CEO Steve Ballmer.
There was no word Monday on whether the Maloofs and Ranadive were any closer to making a deal. The mayor said he didn't know when the Sacramento contingent would attempt to nail down the deal with the Maloofs.
One league expert said Monday that he expects the Maloofs to sell to Ranadive and his seven partners if Seattle is not an option. The family lost its casino two years ago to creditors and has struggled to keep pace with wealthier NBA owners.
"I have to figure they'll sell even if it's slightly less," said Michael McCann, a legal expert for NBA TV. "They're still going to make much more on this team than they ever expected."
Ranadive, who's in line to become the NBA's first India-born team owner, tweeted Monday that he was "speechless," but added, "We still have work to do."
A source close to the deal told The Bee that the Ranadive group intends to put 50 percent of the purchase price in an escrow account by Friday.
This source also said the three Jacobs brothers of San Diego – whose family founded Qualcomm Inc. – would become vice chairmen of the Kings, assuming the Ranadive purchase is completed.
The NBA announced the committee vote in a terse statement that left some key questions unanswered. The league, without any explanation, said its relocation committee had voted against the move to Seattle.
But the other NBA committee in charge of vetting the proposal – the five-member finance advisory committee – didn't vote on whether to approve the actual sale to Hansen and Ballmer. It wasn't clear why.
Disappointment in Seattle
To get control of the team, Hansen and Ballmer would need 23 of the 30 votes from the board of governors at the mid-May vote. They'd need a simple majority to get the relocation approved.
While the situation remained somewhat muddled, Seattle basketball fans, who lost their SuperSonics to Oklahoma City in 2008, treated Monday's vote like a loss.
Ballmer told Seattle radio station KJR that he was "horribly, horribly disappointed." The Microsoft executive added he has little optimism that Seattle will be offered an expansion team.
Hansen issued a statement on his website late Monday saying he is disappointed but will continue to press his case to the NBA in the coming weeks.
"While we are disappointed with the relocation committee's recommendation we remain fully committed to seeing this transaction through," he wrote on sonicsarena.com. "We have a binding transaction to purchase the Kings for what would be a record price for an NBA franchise a much higher price than the yet to be finalized Sacramento Group, and have placed all of the funds to close the transaction into escrow."
Hansen added that the Seattle group has "numerous options at our disposal," but he did not elaborate.
McCann, the NBA TV legal expert, said he was amazed that the league turned aside a group of owners in Seattle with sterling reputations.
"What Sacramento did was beat the odds," McCann said. "One factor had to have been the response of Sacramento to this challenge."
Sacramento developer Mark Friedman, one of Ranadive's partners, told the crowd at Firestone Public House that when Hansen first made his deal with the Maloofs, "there weren't many believers in this city. There were lots of doubters."
Certainly the fight for the Kings, as an increasingly weary Stern has said repeatedly, was unprecedented.
Until now, the most ever paid for an NBA franchise was $450 million, for the Warriors in 2010. Hansen's sweetened offer put a $550 million valuation on the entire franchise, based on what he's paying for the 65 percent controlled by the Maloofs; Ranadive's pegged it at $525 million.
Both ownership groups pledged hundreds of millions of dollars toward new arenas. Sacramento plans to build a $448 million facility at Downtown Plaza, including a $258 million subsidy tentatively approved by the City Council in March.
Beyond that, Sacramento's refusal to give up on the Kings created a tug-of-war that the NBA had never seen before. The competition was supposed to be settled April 19 but dragged on as the NBA continued to vet the competing bids.
"This was a very difficult decision," Johnson said Monday. "You had two cities that deserved to have a team."
Shifting owner group
Seattle offered the larger and wealthier market. Sacramento offered 28 years of loyalty to the NBA, a monopoly market and constant reminders that the team was among the league's strongest franchises barely a decade ago.
Even as Johnson beamed with confidence, telling ESPN recently he was 90 percent sure the team would stay, many fans were cautious in their optimism. When the team played its season finale April 17 at sold-out Sleep Train Arena, several thousand cheering fans stayed in the building long after the game ended – not sure if they'd witnessed the last Kings game ever.
"I'm not surprised at the outcome, but in these situations, you never know," said James Ham, of the Cowbell Kingdom blog, shortly after the committee vote was disclosed. "Emotionally, this has been one of the more taxing situations. After three years there is a relief."
Tom Ziller, founder of the Sactown Royalty website, said he won't rest easy until the sometimes unpredictable Maloofs sign the paperwork ending their tenure as owners.
He added, "Until there are shovels in the ground and we are wearing purple in that new arena, there is always going to be some level of trepidation."
The flamboyant Maloofs bought controlling interest in 1999 and were the toast of the town for several years. As their fortune crumbled, they tried to move the team to Anaheim in 2011 but were effectively blocked by the NBA. They infuriated fans – and Stern – by scrapping a deal for a new arena last spring, and almost immediately began looking for a new home for the team.
After talks fizzled with at least two cities – Virginia Beach, Va., and Henderson, Nev. – they made their deal in January to sell out to the Seattle group.
Within days of the Seattle deal, with national sports media reporting the Kings were certain to leave, Johnson was talking to investors about pulling together a counteroffer.
First in line was Beverly Hills grocery tycoon Ron Burkle, who had offered to buy out the Maloofs two years ago. He was soon joined by 24 Hour Fitness founder Mark Mastrov, followed by Ranadive.
In recent weeks, the ownership group has been in considerable flux. Several new owners came in at the last minute. Out went Burkle, who had to leave because he also owns a sports and entertainment management agency whose clientele includes NBA players. He has pledged to stay involved by redeveloping real estate near the arena site.
In their letter to the NBA earlier this month, the Maloofs complained that the Ranadive group's bid was riddled with uncertainty – and they even questioned whether the Sacramento bidders could come up with the necessary funds. But Stern told reporters in mid-April that the Sacramento bid was largely firmed up.
Call The Bee's Dale Kasler, (916) 321-1066. Follow him on Twitter @dakasler.