Posted: Monday April 16, 2012 12:45PM ; Updated: Monday April 16, 2012 2:52PM
Sam Amick
Sam Amick>INSIDE THE NBA

Unlike Maloofs, Sacramento Mayor Johnson still sees options for Kings

Story Highlights

The hand-shake deal for a new Kings arena in Sacramento crumbled last week

Mayor Kevin Johnson sees billionaire Ron Burkle as a viable option to buy team

The Maloofs, however, remain adamant that they won't sell or move the Kings

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Sacramento Mayor Kevin Johnson still eyes billionaire Ron Burkle as a potential buyer for the Kings -- if the Maloofs agree to sell.
Sacramento Mayor Kevin Johnson still eyes billionaire Ron Burkle as a potential buyer for the Kings -- if the Maloofs agree to sell.
AP
George Maloof Speaks on Kings' Situation
Kings co-owner George Maloof spoke with SI.com on Sunday night about the team's situation. Despite the downtown arena deal being dead and no clear-cut vision for what comes next, he insisted that the family has no intentions of relocating. He also responded to a scathing letter released on Sunday from a prominent associate of Sacramento Mayor Kevin Johnson.

On the Maloofs' intentions ...

"Our intention is still to try to get something done. You have to remember that this is a $400 million deal. We received the term sheet, for what it's worth, eight days before the deadline. We turned it around as soon as we could, and then we had comments and didn't hear back on our comments until a few days ago, and that was that. Are we open to further negotiating? Of course. We want to keep trying, because we feel it's important for the team and important for the city. But we are not plotting to move. That is not an option."

On what's next ...

"There are not a lot of answers. One thing I brought up was redoing Power Balance. I think over the next three to five years in the NBA, you're going to have several teams that are going to be needing a new arena, and not every municipality can afford one. And at times, it might make sense and be more feasible to redo the existing facility. So that's an option that I think everyone needs to think about and consider."

On why it appeared he had backed off that idea over the weekend ...

"I'm not going to back off anything. I think Kevin made it pretty clear that he's not interested in that. I'd like to hear from other people, other members of the city council. Maybe they're not interested, which is their prerogative, but that's why I didn't take it any further. It's something that the city should consider."

On the Maloofs' reaction to the public bashing and their troubled relationship with Johnson ...

"Well, it's pretty tough [for the relationship to improve] when somebody calls you names. We're not politicians. We're business people. We don't play in that field. What we have is a transaction that is a business transaction. I see irony behind the fact that for the 'Think Big' group, if you look in the book itself, it says that all parties had to be comfortable with the deal. It just so happened that we weren't comfortable and the city wasn't comfortable with it, but why blow each other up [in the media]? It's not fair. We haven't done that, and I think it's classless that somebody would say that about my family. It's not fair. We've all put a lot of effort into it, have all worked hard. Everybody has, and it's not easy when something doesn't work out. But you don't start verbally assaulting somebody just because you think it's cute.

"I don't understand it at all. I just don't understand it. I can't speak for them. I don't understand why you'd just pile on somebody who has done nothing wrong. We've done nothing wrong, but work in good faith."

On whether the family is upset with the NBA for the deal the league brokered on the Maloofs' behalf ...

"I think the league did their best. We didn't agree on everything, and that happens. There's nothing negative to say about the commissioner or the efforts that the league has done. I think that they've supported us and done the best they can. Right now, they're at a place where you can't give up, and you've got to keep trying."

On their reaction to the pressure to sell coming from Johnson and Sacramento business leaders ...

"Of course it bothers us, but we don't have any intention to sell. We don't even think about it, to be honest with you. There's no intention. So a lot of that chatter, we just don't pay attention to it. That's exactly what it is -- chatter. Our intention is to stay and work things out in Sacramento. I don't know how to express myself beyond that.

On when they first raised concerns about the deal ...

"It happened before [All-Star weekend in] Orlando. If you look at the paper trail, we had issues with the deal the minute we received the term sheet. That never changed. When you look at the economist [whom they hired to present their side at the Board of Governors meetings last week], his view was more about the [projected revenue] numbers, which we agreed we thought was crazy, and the effect that it would have on, ultimately, Sacramento -- the potential impact it could have on the whole city. The numbers were very tough, and the economy is still challenging, but that doesn't mean we can't try to work through it. The numbers that we used are just crazy. They didn't make sense, the projections.

"[The economist] was hired at the request of one of our partners, one of the other owners of the Kings. You have to remember, our partners weren't comfortable with [the arena deal]. I think people fail to realize that our partners were very uncomfortable with the deal from the start as well."

On Stern's private reaction to the Maloofs' declining a deal he brokered ...

"I can't speak for David, but I can tell you that we don't always agree. He doesn't always agree with other owners. There are just times when you don't agree. But I think at the end of the day, we're not going to take away any effort from the commissioner of the NBA. They worked very hard, just like we have, but it just hasn't worked at this point."
NBA Team Page

SACRAMENTO, Calif. -- Before the mudslinging became a routine public affair here, the harsh words between city officials and the Maloof family that owns the Kings were typically kept behind closed doors.

And so it was in the late morning of March 29 inside a conference room at Old City Hall, where Mayor and former NBA point guard Kevin Johnson dished his dirt while speaking to about 25 members of the Kings' A-list team sponsors. Despite all the excitement surrounding the handshake deal for a new downtown arena made more than a month before, Johnson -- who raised some $10 million from these same business leaders the year before as a way of showing the league how badly the Maloofs had mismanaged this market -- had a warning for the group.

He told them that a bit of bad arena news "might be coming out of L.A.," as one source who was in the room remembered, a clear foreshadowing of the Los Angeles Times report published just hours later that detailed the Maloofs' concerns about the deal and raised the possibility yet again that they might be on the move. Johnson -- who had seen Kings co-owner Gavin Maloof cry tears of joy when they had the "framework" agreed to at All-Star weekend in Orlando; who had celebrated with the team's owners on the Power Balance Pavilion court as if this game was over; and who had spent so much of his time in office pushing this revitalization project only to see it fall apart at the end -- was fuming about this failed partnership again. He said the Maloofs "should be ashamed to show their faces in Sacramento," the source said, then offered an unsolicited reminder that his Plan B was still very much in play: Ron Burkle.

A year after Johnson partnered with the L.A.-based billionaire to put pressure on the Maloofs to sell the Kings, sources say he remains in constant contact with Burkle and is still hopeful that he will eventually take over the team and keep it in Sacramento. Burkle, the Pittsburgh Penguins' owner who was ranked 107th on Forbes' list of richest people in America last year (net worth of $3.2 billion), was a major part of Johnson's pitch to stop the Maloofs from moving to Anaheim.

His known associate, lobbyist Darius Anderson, accompanied Johnson to the Board of Governors meeting last April in which Johnson made his successful pitch that led to at least one more season in Sacramento. And while it's not known if Burkle is alone on the list of prospective owners (there is a nameless mystery man who is a prospective owner as well), Johnson ceased negotiations with the Maloofs on Friday and appears determined to pursue the strategy he seemed to prefer all along.

This push to force the Maloofs out was already underway on Thursday, when 26 Sacramento business owners sent a letter to NBA commissioner David Stern urging him to "strongly encourage" the family to sell. That message came directly from Johnson's camp for the first time on Sunday, by way of a 1,853-word letter sent to members of Johnson's regional initiative, "Think Big Sacramento."

The scathing account of the recent events took aim at the Maloofs for the way they backed out of the $391 million deal, and concluded by raising the idea of "an alternative ownership group."

It was penned by a man named Chris Lehane, the Think Big executive director whose career has suddenly become a case of life imitating art. Lehane, who is widely known as a cutthroat political consultant who worked for the Clinton White House, is the co-writer of the independent film Knife Fight, which premieres in New York later this month.

The title of the movie was born out of Lehane's commentary on the 2008 presidential election, when he worked with the Al Gore/John Kerry Democratic team and famously said, "In the last five days, it always comes down to a knife fight in a telephone booth." The sneak preview took place at the Board of Governors meeting last week in New York and continued in Sacramento over the weekend.

After Kings co-owner George Maloof and a family-hired economist attempted to defend the decision to decline the deal during an emotional, non-NBA sponsored, 90-minute press conference in New York, Lehane released a statement that took the public bashing to a whole new level.

"As their bizarre press conference laid bare for all to see, dealing with the Maloofs is like dealing with the North Koreans -- except they are less competent," Lehane wrote. "In Maloof world, facts are fiction, truths are half-truths and promises are broken promises. The city of Sacramento deserves better."

In an interview with SI.com, George Maloof said he's miffed at the outrage.

"I don't understand why you'd just pile on somebody who has done nothing wrong," he said. "We've done nothing wrong, but work in good faith."

But Johnson's premise -- that the Maloofs will sell or be forced to sell -- is the part where it gets puzzling. No matter how badly he and perhaps the NBA want the Maloofs to hand the team over, the family continues to say it won't give in to the pressure and that relocation isn't an option this time around even with the latest setback.

Given Stern's history as the kind of commissioner who can't be crossed, the notion that there would be no recourse for the egg on his face seems unfathomable. The Maloofs, who say they voiced their concerns for seven weeks without response from the city, declined a deal that was essentially drafted by Stern himself and funded, for their part, by the Bank of the NBA.

George Maloof said his family took issue with the arena deal the moment the terms were presented.
George Maloof said his family took issue with the arena deal the moment the terms were presented.
Ethan Miller/Getty Images

Stern's team of officials handled all negotiations with the city, and he revealed on Friday that $67 million of the $73 million to be contributed by the Maloofs would be on loan from the league (with an additional $7 million in NBA contributions to the project as well). The city's contribution was expected to be worth up to $255 million, while arena operator and builder AEG had agreed to pay $59 million. Nonetheless, the Maloofs now contend that revenue projections were overly optimistic and that both they and the city would be far too exposed financially over the 30-year life of the deal.

But just because former Lakers coach Phil Jackson once compared the Maloofs to the McCourts doesn't mean there will be a hostile takeover anytime soon, even if the Kings are about to conclude their sixth straight losing season and have spent recent years with minimum payroll rosters and questionable management. Major League Baseball rules that allowed commissioner Bud Selig to assume control of the Dodgers don't exist in the NBA, and the threat of a possible antitrust lawsuit from the Maloofs could be forcing Stern to support their decision.

Meanwhile, the Maloofs, who initially claimed that a $3.25 million redevelopment fee was the main holdup of the deal, have likely lost more than that in team sponsorships and future attendance by way of this public relations disaster. Because so many businesses agreed to one-year deals last season as a result of the one-year reprieve, sources close to the team say there are more than 50 partners up for renewal for next season and there's simply not much incentive to invest in the future. And while the Power Balance Pavilion crowd at Sunday night's game against the Trail Blazers was surprising in its size (16,012) and serenity -- not to mention the appearance of Joe and Gavin Maloof, who watched the game from their suite but scrapped a plan to sit courtside and perhaps even address the crowd -- it's hard to imagine the support continuing without the return of hope here.

What it all means going forward remains unclear. Those who see the Maloofs as cash-strapped, debt-ridden owners with no business owning a team hope the likely downturn forces them to sell, while others predict they'll survive next season and have all the evidence they need to tell the NBA to get out of their way thereafter en route to Anaheim or elsewhere.

George Maloof insisted that the family wants to remain and reiterated his stance that Johnson is killing the downtown deal by refusing to negotiate further. He has also reversed his family's long-held stance on the possibility of renovating the current facility, but Johnson said he has no interest in that option.

"Are we open to further negotiating [on the downtown arena deal]? Of course," Maloof said. "We want to keep trying, because we feel it's important for the team and important for the city. But we are not plotting to move. That is not an option."

As Johnson sees it, though, Ron Burkle is.

 
SI.com
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