What exactly is for sale?
That is the biggest question surrounding the sale of the Atlanta Hawks. Currently, the question of who will buy the team cannot be answered. That process won’t even begin until it is established just how much of the franchise is on the market.
All we know at this point is that Bruce Levenson and his Washington partners have agreed to sell their controlling interest of 50.1 percent of the franchise.
What about Michael Gearon Jr. and partners and their 34 percent? What about the group of investors from New York and their 16 percent? On that subject, I have been told “no decision has been made.”
The Atlanta Spirit board has yet to meet, make their intentions known and vote on what will be sold. That meeting could occur in the next 10 days. Only at that point can an investment firm be hired and prepare the necessary economic data to start the vetting process of prospective buyers.
The current state of affairs exists because of the racially inflammatory remarks of Levenson and general manager Danny Ferry, now on an indefinite leave of absence, that have recently come to light.
Atlanta mayor Kasim Reed gave a briefing Friday on the sale process. The city actually has little to do with the sale process. The Fulton County Recreation Authority is involved with the remaining debt on Philips Arena but the city has no definitive say in who buys the Hawks. It’s not like Mayor Reed can come to your house and put a For Sale sign on the front lawn – or on the lawns of the 12 who hold the financial interest in the Hawks.
Reed said he expects the sale of the Hawks to move quickly – and it may once a final buyer is identified. However, to put a sale completion date of the end of the year as a goal is premature. The sale of a professional sports franchise is complex. The sale of the Hawks, with all of its current issues, is fragile. This ownership group has proven not to be aligned in light of the recent events.
Reed pointed to the speed of the recent sale process involving the Clippers. That franchise had one owner and one buyer with $2 billion to spend. Remember the Hawks were to be sold two years ago before that deal fell through when that buyer did not have the liquid assets.
Also of importance is the fact that the field of prospective buyers will be determined by what percentage of the team is for sale.
– An individual or group may not be prepared to buy in if, say, the Atlanta group keeps its share considering the dynamics of the Spirit group – historically and of late.
– Maybe Gearon just buys out Levenson and changes the controlling ownership.
– There will certainly be a shallower pool of capable buyers if the entire franchise is for sale with an estimated sale price of, let’s ball park it at, $700 million. Some inthe Hawks organization think the sale price could reach $1 billion. Steve Ballmers don’t grow on trees.
Reed said there has been “robust” interest in the Hawks. I’m told that is true. There indeed have been a significant number of individuals and groups who have inquired, almost on a daily basis, about the Hawks. However, their opening question is not ‘How much?’ but rather ‘What is the process?’ We are a long way from an asking price.
Reed has been able to quell any notion that the Hawks will be sold and moved. Seattle is certainly looking for a team to fill its NBA void. The mayor has already had two professional franchises leave the city limits on his watch. He wasn’t so forthcoming with public funds before this very group sold the Atlanta Thrashers and watched as they were moved to Winnipeg. Where was the $150-200 million when the NHL franchise needed it? It also remains to be seen whether the city will actually fork over such money when the Hawks buyer holds out its hand.
Even for Reed’s efforts, including a meeting with NBA Commissioner Adam Silver last week, there was little chance the Hawks would be moved. The league is not about to watch a Top 10 market lose a franchise, especially not one that more often than not has Top 5 television ratings. Did I mention there is a new television deal in the works? That is one of the reasons for the inflated estimations in the worth of franchises of late.
We are all eager for resolution to the ownership situation and to move forward – both with the healing process and the game of basketball. The process is really just beginning.