Even as they begin building a new downtown arena, the owners of the Kings are in discussions to expand their footprint in the region by buying Sacramento Republic FC – the minor league soccer team selling out games locally since April.
There is no agreement in place yet between the Kings and the Republic, but the Kings owners are interested in the idea of investing in the franchise and elevating it to the level of Major League Soccer, America’s premier soccer league, according to sources with knowledge of the talks. They declined to speak publicly because the deal isn’t completed.
This week, Kings President Chris Granger will travel to Portland to meet with MLS officials along with current Republic owner Warren Smith. Sacramento Mayor Kevin Johnson is also expected to attend the meeting, scheduled for Wednesday.
A source close to Kings majority owner Vivek Ranadive said he sees soccer as a “tremendous opportunity for a larger vision of growth in Sacramento.” Soccer also fits with Ranadive’s interest of investing in sports that can create excitement not only locally but also internationally.
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The prospect of Ranadive and the Kings suddenly materializing as legitimate players in a Sacramento pitch to MLS caps a dizzying few months for the little soccer team started by Smith, a former River Cats executive.
From the beginning, Smith planned on laying the groundwork for MLS by creating excitement around a minor league team in Sacramento that was built to grow. Part of that plan was to use the success of the Republic to entice investors and the capital needed to run an MLS franchise.
It worked. The Republic has drawn more than 118,000 fans to its games this year, smashing the attendance record of their current league, USL Pro. At the same time, the Sacramento market produced some of the highest TV ratings in America for the recent World Cup.
“Clearly the support for the Republic has been noticed by all of us,” said Dan Courtemanche, executive vice president of communications for MLS. “It’s been incredible what we’ve seen week in and week out.”
Amid growing momentum, Smith began quietly talking to minority Kings owner Kevin Nagle, a successful businessman based in El Dorado Hills. Nagle, in turn, began talking to his partners with the Kings. It was then that talks between the Kings and the Republic intensified.
In an interview, Nagle said: “It makes all the sense in the world to figure out how to align collectively – soccer and basketball,” Nagle said. “It would enable us to take advantage of all the synergies available in marketing and sponsorships … To be a better enterprise to respond to the wants and needs of our fans.”
The full weight of the Kings franchise would be in line with a trend of investment in soccer by major owners in traditional American sports.
Groups including the New York Yankees of Major League Baseball and the Atlanta Falcons of the NFL own new MLS franchises in New York and Atlanta.
Courtemanche said the league hopes to expand from its current 22 teams to 24 by 2020. MLS has committed a 23rd franchise to Miami if former soccer superstar David Beckham can build a downtown stadium there – though Miami officials have twice rejected a Beckham stadium plan.
That leaves Sacramento in competition with cities such as Minneapolis, San Antonio and Las Vegas for the 24th franchise.
Though not as costly as an NBA franchise, an MLS franchise fee would not come cheap for a Sacramento group. The Atlanta Journal-Constitution reported that Arthur Blank, owner of the Atlanta Falcons, paid $70 million for an Atlanta franchise set to begin MLS play in 2017.
A Sacramento group will meet with MLS officials in Portland this week for its nationally televised All-Star game on Wednesday.
Sources said the Sacramento officials hope to formally schedule a visit to the region by MLS officials, perhaps this fall. The MLS board of governors will meet in September, and some in the Sacramento group hope to have a new Republic ownership team and the outline of a stadium plan in place by then. A location for the stadium has not been determined yet.
The source close to Ranadive cautioned that the deal “has to make sense” to the Kings but that interest in acquiring the soccer franchise is strong.
Ranadive’s group paid more than $500 million to buy the Kings last year and has pledged to spend as much on surrounding development near a new arena slated to open in 2016 at the old Downtown Plaza. The Kings are contributing $222 million to the arena, with the city putting in $255 million. On Friday, Johnson presided at the beginning of demolition work at the faded mall adjacent to blighted buildings at Seventh and K streets. Also last week, the Kings signed a lucrative television deal worth a reported $700 million over 20 years.
Smith said he’s confident his MLS dream can happen. “We’re trying to do something really good for the community,” he said. “It’s very exciting.”