Steve Ballmer Wants to Buy Staples Center, Maybe LA Kings

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Mistwell
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http://www.thehockeynews.com/blog/could ... -of-kings/

Could Clippers owner Steve Ballmer become king of Kings?

By: Ken Campbell on June 8, 2014

EN ROUTE TO NEW YORK The Los Angeles Kings are two wins away from their second Stanley Cup in three years. And depending upon whom you believe, they're on the verge of being sold.

If you believe those in the hockey industry who keep tabs on such things, the Kings are for sale. But that should come as no surprise. The Kings are one of those teams that perpetually seems to be for sale from its parent company (AEG) even when there's little or no outside interest in buying them. If you believe AEG chief executive officer Dan Beckerman, who called a recent report in the New York Post that the Kings are for sale "appalling," well then the Kings aren't going anywhere.

The truth probably lies somewhere in between. While the Kings might not be for sale and AEG might not be looking for buyers, it's not a stretch to suggest the company would sell the Kings if there were interest.

And according to one person close to such matters, there actually is an interested buyer. Well, sort of. And it's, get ready for this one, reportedly former Microsoft CEO Steve Ballmer, who recently purchased the Los Angeles Clippers for $2 billion. Ballmer, who was spotted sitting and chatting with Kings president of business operations Luc Robitaille at Game 6 of the Western Conference final, isn't completely keen on buying the Kings, according to our source, but might have to take them as part of a much bigger transaction.

The speculation surrounding Ballmer is that, according to our source, is in negotiations to purchase the Staples Center from AEG and the L.A. Arena Company (a subsidiary of AEG) for a price tag of about $1 billion. But our source tells us that AEG would only sell the Staples Center if the Kings were also part of the deal. That would push the deal to as high as $1.5 billion. AEG owner Philip Anschutz tried to sell AEG in its entirety two years ago, but could not find a buyer for the price tag of between $8 billion and $10 billion. So the notion that AEG might sell off its assets piecemeal makes some sense.

That would mean Ballmer overpaid for both the Clippers and Kings, but if they're rolled into an ownership group that also owns the Staples Center, their value would certainly rise. One of the reasons the Kings don't make any money, and in fact lose millions each season despite having a string of 119 sellouts as of Game 2 of the Stanley Cup final, is that despite the fact they're owned by the same company that owns the Staples Center, it is a tenant in the building.

(As an aside, winning Stanley Cups and having a well-run organization are all well and good, but they don't have much bearing on the actual value of the franchise. More than anything else, revenues drive up franchise values and the Kings don't have enough of those. See Maple Leafs, Toronto.)

If Ballmer were going to buy the Clippers for such a high price, it would make sense for him to own the building as well and not be a tenant. And if that means buying the Kings as part of the deal, then it might make sense.

Speaking of franchise values, NHL commissioner Gary Bettman said at his annual state of the union media conference prior to Game 1 of the Stanley Cup final that if the Clippers are worth $2 billion, there are plenty of NHL teams worth that or more. He wasn't actually saying there are teams worth $2 billion because there are not, he was referencing it in terms of the Clippers sale. Just last year, the majority stake of the Maple Leafs Sports and Entertainment conglomerate that also includes the Air Canada Center, the Toronto Raptors, Toronto FC and the Toronto Marlies was sold for just $1.32 billion. That amount purchased 79.57 percent of the company, which would place the value of the entire company at just $1.6 billion.

Keep in mind that much of this is speculation at the moment. But whether or not the Kings are sold anytime after the Stanley Cup final, it's probably safe to say the reports of them being on the market are more than just idle chatter.

xldicelx
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is ballmer sick? or is he just trying to spend his $$$ and enjoy it now that he's older?

if that's the case hook me up... lol

It would be interesting if this was true....

realbull17
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I hope he give the flakers the boot. Very Happy

jarca
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Yes I'm hoping he boots the lakers and toss their banners on the street

FightOnRon
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I jokingly said this is what he should do in another thread,then give the Lakers the boot. Ask and ye shall receive I guess.

JQuick32
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I'd love for him to own the Kings as well. Lots of cross-promotion opportunities.

ClipperKyle32
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So i guess he is moving the Clippers, Kings , and the entire Staples Center to Seattle? *sarcasm*

BaadMaster
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It's good to be the King.

toohipcliptoslip
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Interesting.

If he doesn't have to pay rent for the Clipps. Does this in any way offset the huge price? How does the Kings poorit margin fit the equation? His cost is only the cost of hosting the games at Staples. He gets rent for the Lakers plus all the other stuff. CAn he icrease the revenue of the Kigs? What is the overall net of Staples now?

Does he overpay for the teams but make up for it with Staples?

Interesting

realbull17
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He can afford Clips, staples center, & kings. He's worth 20+ billion.

zaneil3715
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What a guy. I'm pretty sure that he would spend more for the Clippers.

cleepers
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The plan:

Buy Staples center...

Publicly whine about a poor ROI from the lakers' "lease" due to it being a % of box office and nobody attending their games anymore because they're crap...

Put it in the media that their lease won't be renewed because he could make more money from Rihanna and Lady Gaga shaking their coochies at 20,000 people 41 times a year, thereby forcing the lakers to look elsewhere for a home...

Swoop in to "rescue" them by offering to build them an arena...

Sell the Clippers and Staples to Ellison/Geffen to bypass NBA's 'conflict of interest' concerns...

Build arena in Seattle with the proceeds...

Buy lakers and move them there.

And, Bingo! Everybody's happy (except laker fans, but then, they start riots when they're happy)

Ladies and Gentlemen, I give you...

The Seattle LakerSonics!

FightOnRon
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As of this morning it appears the sale is off. Ballmer should be Staples and kick both NBA teams out.

JQuick32
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If Ballmer does end up owning both teams, another positive is that Doc could learn from Dean Lombardi (one of the best GM's in sports).

ClipSince7thGrade
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I think that buy the Staples center as well as the LA Kings would be a great move for Ballmer. It would be a fast way to get his 2 billion back. I mean if AEG is packaging the Kings and Staples center together for just 1.5 billion it's almost a no brainer. I don't think kicking the Lakers out of the Staples center would be right or something Ballmer should do if he were to become the owner of the arena. I hate the Lakers just as much as the next guy but they already have statues outside, a little too late to kick them out. Doesn't mean that we can overwhelm the front with statues of past Kings and Clippers players. The Kings will just continue to get more and more popular with the more championships they win. The fan base actually took a huge spike in LA, being a LA native I would never see or hear anyone talking about the Kings other than the die hard fans of the sport. I'll admit that I didn't pay too much attention to them either. Now that they brought home a championship more and more younger people are getting into the team as am I (feels weird to banwagon). I see them just upping their value in the next couple years. And just like JQUICK said tons of cross promotion opportunities, which is a huge positive for both franchises. Also both are currently with PrimeTicket which should make it even easier to make commercials and other promotional cut aways.

FreaKeyy
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Kicking the Lakers out is a little to harsh. Just having the luxury to shut their fans up whenever they say we should move is enough for me.

Laker fan: Dude your team needs to leave Staples Center and build their own arena.

Me: Uhh No! We can still share the arena

Another Laker fan: ummm I think Clips owner also owns Staples Center

Me: Bingo! See, if anything you guys should move *Wink* Wink*

Laker fans: Fckkk!

Such a satisfying conversation... only if this actually happens.

Trueblood
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I don't necessarily think Ballmer should kick them out but if I were the Lakers, I would start thinking about building my own arena. As big a brand as they are, they could sell naming rights for a ton of money. Farmer's was willing to fork over $700 million for the dead football stadium. If they could just get half of that then it would make sense financially to go build their own crib.

The statues can be easily moved and the banners can be taken down in less than an hour. Those are moot points. Change Chick Hearn Ct. to Ralph Lawler Ct. and we're rolling. More importantly, the Clippers can finally claim NBA exclusivity at Staples.

This isn't HS basketball with a JV and a varsity. NBA teams are billion dollar assets. They shouldn't be sharing an arena.

Trueblood
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Here's what I don't get though. Why spend a billion on Staples and another $500 million on the Kings when you can build your own arena for a third of that?

I'm all for Ballmer being able to buy Staples but a billion seems a bit outlandish given that it was built for a little over $300 million and it's a 15 year old building. Arena values actually go down with age unlike houses.

That being said, the Clipper lease is horrible. They get ZERO revenue from suite sales. If Ballmer owns the arena, he would now have access to suite revenue that would be worth over $40 million a year. Still doesn't justify spending $1.5 billion on the arena when he can build his own with a third of that but yes, he would start making his money back on a much quicker basis than what he's getting back now.

jarca
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Staples get all the profit on suite and VIP sales from all teams that play in the arena not just the clippers. From what I understood because I inquired about VIP season tickets and they sell those as package for lakers, clippers, kings, and sparks. That's what was explained to me by the clippers ticket rep that staples own those seats for all the team

ClipperKyle32
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I am optimistic, but if Ballmer happens to purchase the Staples Center... Could He possibly break the lease between the Clippers and the Staples Center. And move the team to Seattle?

I am not saying he would , I am just asking could he?

Trueblood
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It would be a lot easier to move to Seattle if he bought Staples Center but would make even less sense than it does now because he would be another $1.5 billion "poorer". It would be a lot cheaper to just buyout the current lease for $30 million if he wanted to move to Seattle. Of course, he'd be at the mercy of whether or not AEG would agree to the buyout but it would be a lot cheaper than outright buying Staples and the Kings for $1.5 billion.

Trueblood
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Right. That's where I get the $40 million from. A combination of all events at Staples and not just the Clippers although I didn't factor the VIP seats in there so the amount is going to be more than $40 million but I still don't think it justifies a $1.5 billion expense when you can save over $1 billion building your own arena from scratch.

realbull17
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He can't move them anyway. In the agreement to sell to Ballmer he can't relocate the team. So the clippers isn't going anywhere.

JQuick32
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I hope Ballmer buys Staples and evicts the Clippers and no other arena will take us. Maybe literally not having a place to field a team will force DTS' hand and make him relent and sell.

cleepers
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Spoken like a true fan.

roll

realbull17
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He probably wants to buy the Kings even more now that they won the Cup. Very Happy

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