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Bernie: A Look At Kroenke's Strategy

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  • #1

    Bernie: A Look At Kroenke's Strategy

    05.10.2010 11:00 am
    Bernie Bytes: A Look at Kroenke’s Strategy
    By Bernie Miklasz


    The latest twist in Stan Kroenke’s pursuit of the Rams comes from Daniel Kaplan of The SportsBusiness Journal. Kaplan reports that Kroenke is attempting to get around the NFL’s cross-ownership rules by turning the team over to his wife, Ann Walton Kroenke. According to Kaplan, Kroenke pitched that proposal last week during a meeting with the NFL Finance Committee, which is overseeing the sales process. The SBJ reported that Kroenke’s proposal included other options, but no specifics were cited.

    Kroenke owns 40 percent of the Rams and opted to match Shahid Khan’s bid to purchase the controlling 60 percent interest from Chip Rosenbloom and Lucia Rodriguez. But because Kroenke owns the NBA Denver Nuggets and NHL Colorado Avalanche, teams that compete for Denver sports dollars with the NFL Broncos, he is prohibited from owning an NFL franchise in another market.

    Jim Thomas of the St. Louis Post-Dispatch reported that Kroenke would likely try to circumvent the rules by selling or transferring the Nuggets and Avs to his wife. And that option is still on the table for consideration, NFL sources say. But Kroenke seems to be exploring every possible angle in an attempt to satisfy the NFL. Kroenke’s apparent willingness to transfer or sell the Rams to his wife is just the latest scenario to be floated.

    Let’s take a look. Here are some of my initial thoughts:

    * Ann Kroenke certainly has the money to buy the Rams; she’s listed on the Forbes annual survey of the wealthiest Americans with an estimated worth of $3.2 billion. (Kroenke’s estimated worth is $2.7 billion.) But it isn’t so simple.

    * The Rams’ ownership agreement stipulates that Stan Kroenke has the right of first refusal on the Rams’ sale. Not Ann Kroenke. Stan Kroenke had the right to match Khan’s bid. Not his wife. So on the surface, how could the NFL allow this?

    * Or is the NFL willing to compromise by agreeing to let Kroenke match and take over as the 100 percent owner of the Rams as long as he agrees to quickly sell the team to his wife?

    * Why didn’t Ann Kroenke simply bid for the Rams at the time the Rosenblooms had their 60 percent share on the market? This would have been easier than (A) having Stan Kroenke match Khan and (B) Kroenke having to work around the cross-ownership guidelines. (Likely answer: the Kroenkes didn’t want to get in a bidding battle with Khan that would drive the price up; they probably preferred to wait, let Khan make a reasonable bid, then match. I’m only guessing here.)

    * Do any of these possible scenarios really satisfy the spirit of the NFL rule on cross ownership? Let’s say Kroenke sells the NHL and NBA teams to his wife, or transfers them to his son, Josh. Fine. But the Nuggets-Avalanche and Pepsi Center revenues would still stay in the Kroenke family. And does anyone think that Stan Kroenke would recuse himself from major decisions that have to be made with the Nuggets and Avalanche? Does anyone think Kroenke would stay away? That’s especially true of the Nuggets. Stan is an NBA fanatic. He loves that team and is a regular visitor to Nuggets’ practices and shootarounds. So is Stan really going to keep a distance from the Nuggets? OK, let’s say Kroenke sells the Rams to his wife. Do we really believe that he’d be on the outside, uninvolved with major decisions and transactions at Rams Park?

    The Kroenkes would be very attractive owners for the Rams franchise. So what it comes down to is this: is the NFL willing to look the other way? If the NFL isn’t willing to look the other way, I don’t see how any of this flies. And really, that’s what all of this will come down to. All of these scenarios and potential solutions lead to the same destination: the NFL owners will determine just how important it is to them to have Stan Kroenke own the Rams, and the owners will determine just how far they are willing to go to bend or relax the rules for Kroenke.
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  • MauiRam
    Kroenke waiting for move on Rams
    by MauiRam
    Bernie Miklasz bjmiklasz @post-dispatch.com 314-340-8192
    ST. LOUIS POST-DISPATCH
    06/14/2009

    One of the more compelling aspects of the Rams' sale is the role of Stan Kroenke in the proceedings. Rams owners Chip Rosenbloom and Lucia Rodriguez, team insiders and other NFL executives and owners are wondering: what is Kroenke going to do? Is he going to make a play for control of the team? And if so, when?

    Don't expect Kroenke to lay his plan out for us. He's staying underground on the Rams' front and not returning media calls. He's not about to give away any clues on his Rams' strategy.

    Kroenke, worth an estimated $3 billion, is a busy sports mogul. He owns 40 percent of the Rams. He owns the NBA Denver Nuggets, the NHL Colorado Avalanche and the Pepsi Center in Denver. He owns the Major League Soccer franchise in Colorado and the stadium that houses the team. He is the majority shareholder (28.3 percent) of the prestigious Arsenal soccer club in the English Premier League. Kroenke owns a pro lacrosse team, an arena football team, and a Colorado-based cable-sports network.

    And Kroenke's real-estate development company continues to prosper, making him one of the nation's wealthiest individuals according to Forbes magazine.
    So does Kroenke want to buy the available 60 percent ownership block and challenge NFL rules that prohibit cross ownership? Or is he content to hang onto his 40 percent, oversee his other sports properties, concentrate on accumulating more Arsenal stock and avoid a skirmish with the NFL?

    After speaking to a couple of Kroenke associates — sorry, no names — I think I have a general handle on his approach. But I can't be sure. Remember, this is the same Kroenke who made no noise about being interested in the Nuggets and the Avalanche, only to swoop in and buy them at the end of the process. Kroenke waited until the collapse of Bill Laurie's tentative deal for the teams, then made his move. And Laurie is Kroenke's brother-in-law, but Laurie knew nothing of Kroenke's intentions.

    I believe Kroenke will sit and wait for others to make the first move.

    It makes sense, because Kroenke has the right of first refusal on the Rams' sale. He can match any offer for the available 60 percent. By hanging back, Kroenke won't set the market and take the risk of bidding against himself to meet Rosenbloom's price. Instead, it's smarter for Kroenke to wait for another interested party to set the market, then react accordingly.

    If another bidder makes an offer on the lower side, and the price is acceptable to Rosenbloom, then Kroenke can match the offer and get a relative bargain. He can save millions of dollars on the purchase. If Kroenke gets a great deal, then he may be more inclined to fight the league over that 60 percent.

    And what if another bidder rushes in and pays whatever Rosenbloom-Rodriguez...
    -06-14-2009, 11:26 AM
  • MauiRam
    Will Kroenke make a sweetheart deal?
    by MauiRam
    By Jim Thomas
    ST. LOUIS POST-DISPATCH
    04/18/2010

    Stan Kroenke's attempt to finesse the NFL cross-ownership rules may not involve a transfer of hockey and basketball teams in Denver to his family. But rather a sale — to his wife, Ann.

    According to a couple of league sources that tactic could be Kroenke's best hope of getting the NFL to approve his attempt to purchase the 60 percent of the Rams currently up for sale by siblings Chip Rosenbloom and Lucia Rodriguez.

    As wealthy as Kroenke is, he comes in second place at home. At $2.9 billion, he was ranked No. 342 on Forbes' most recent annual list of world billionaires. His wife, Ann, heiress to much of the Wal-Mart fortune, was ranked No. 297 at $3.2 billion.

    So what happens if Ann Walton Kroenke "simply" writes a check for the Denver Nuggets NBA team and the Colorado Avalanche NHL team? How does the NFL react to that?

    "Independent wealth means a lot," one league source said.

    And that's what Ann Walton Kroenke has.

    So at face value, that option might be more palatable to league owners than having Kroenke simply transfer ownership of the Nuggets or Avalanche to some combination of his wife, his son, Josh, or daughter, Whitney.

    When asked if that would be an acceptable path, NFL senior vice president Greg Aiello replied: "I can't answer that question. It's not my question to answer. That's something that has to be decided by NFL ownership. And right now, they can't answer that because they don't know what he's proposing."

    Even those close to Kroenke believe Kroenke has yet to decide on a precise path to finesse the cross-ownership rules.

    But one avenue seems definitely closed: selling the Denver teams to an outsider. Whether it's sports properties or other business properties, Kroenke's history has been as a buyer and a keeper — not a seller of assets. And because he also owns the building the Nuggets and Avalanche play in — the Pepsi Center — it has proved to be a profitable setup.

    If Kroenke sold the Nuggets and Avalanche to his wife, it appears he could maintain ownership of the Pepsi Center. There's nothing in the NFL's cross-ownership rules that would prevent him from keeping the venue. So that would make the purchase cheaper for his wife.

    In 2000, just a few months after the St. Louis Rams defeated Tennessee in Super Bowl XXXIV, Kroenke purchased 93.5 percent of the Avalanche, Nuggets and Pepsi Center. The overall value of those assets at the time was $450 million.

    It is a violation of the NFL's cross-ownership rules for Kroenke to own the Nuggets and Avalanche once he has controlling interest in the Rams. Kroenke already owns 40 percent of the Rams; he will own the full 100 percent of the team if he's successful in his bid to buy Rosenbloom's and Rodriguez's 60...
    -04-18-2010, 12:20 PM
  • HUbison
    Expect approval for Rams' Kroenke
    by HUbison
    From ESPN.com...
    -04-13-2010, 07:47 AM
  • r8rh8rmike
    Bernie: Is Kroenke Spreading Himself Thin?
    by r8rh8rmike
    Bernie: Is Kroenke spreading himself thin?

    BY BERNIE MIKLASZ, Post-Dispatch Sports Columnist
    Monday, April 18, 2011


    The occasion is an important match in the English Premier League, Liverpool at Arsenal, and Kroenke will be in the stands at Emirates Stadium. But will the TV cameras be able to find him? (Yes. Kroenke was on camera multiple times during the 1-1 draw.)

    "Silent Stan" Kroenke is now an international man of mystery after his friendly but stunning takeover of Arsenal FC, one of the most storied and distinguished franchises in soccer history.

    Last week, Kroenke put up an estimated $230 million to increase his ownership stake in the Gunners from 29 percent to just under 63 percent. Under terms of the deal, Kroenke is obligated to offer to buy out the remaining shareholders, which could mean an additional investment of tens of millions of dollars.

    Kroenke has added another prominent team to a collection of sports properties that includes your St. Louis Rams, the Denver Nuggets (NBA), Colorado Avalanche (NHL), Colorado Rapids (MLS), the Colorado Mammoth lacrosse team, the Pepsi Center arena in Denver and a regional sports network in Colorado. That's in addition to his real-estate development and other non-sports businesses.

    Kroenke has positioned himself to be a powerful figure in the sports world. With his emergence in Europe, he's established a global presence. And if the NFL ever decides to put a franchise in London, Kroenke looms as an interesting figure, seeing that he'll already be established there.

    I'm an Arsenal fan from way back, so I join my fellow Gunners supporters across the Atlantic in wondering what we should expect from Kroenke.

    The central question seems to be this: Will he spend money to acquire the elite pieces deemed necessary to put Arsenal back atop of the EPL table?

    It's roughly the same question Rams fans have about Kroenke as he begins his second season as the team's majority owner.

    With the NFL's free-agent market shut down because of the labor dispute between the owners and players, it's impossible to get an answer. But in a recent interview with Jim Thomas of the Post-Dispatch, Kroenke didn't eliminate free-agent signings as a way to improve the roster but strongly reaffirmed his belief in the philosophy of building through the draft.

    Kroenke's increased stake in Arsenal raised another question: Does he own too many teams? Can he devote enough individual time to the Rams? It depends on your views. Those who prefer an on-site, hands-on owner will be disappointed.

    In my previous discussions with Kroenke, he politely dismissed this as a concern, saying that he isn't a micro-manager or meddler. He prefers to employ capable executives and coaches and let them do their jobs. There's been speculation that Kroenke...
    -04-18-2011, 08:49 PM
  • MauiRam
    Kroenke's silence might say a lot ..
    by MauiRam
    Bernie Miklasz
    Sports Columnist Bernie Miklasz

    ST. LOUIS POST-DISPATCH
    04/15/2010

    What a strange time to be a Rams fan in St. Louis. We're eight days away from the NFL draft, and the Rams hold the first choice. They're probably going to choose talented Oklahoma quarterback Sam Bradford, a good guy with an accurate arm who can become the new face of the franchise and a symbol of hope.

    After three seasons of 6-42 football, this should be a time of looking ahead to better, happier days. But as usual, Rams fans are left to wonder what's going on. The glimpse into the future is hazy. An unsettled, uncertain ownership situation has put the franchise in turmoil. And that's unfortunate.

    The concern is that the football operation is limited and unable to spend money and make moves because of the uncertainty at the very top of the franchise. If Chip Rosenbloom and Lucia Rodriguez are selling their 60 percent to Stan Kroenke or Shahid Khan, then haven't they already checked out?

    "Nothing could be further from the truth," said Kevin Demoff, the Rams' chief operating officer. "We're making football decisions based on what's best for the Rams in the short term and the long term. We presented an offseason game plan to Chip and Lucia, and they agreed to it. Nothing has changed. There are no constraints. They are actively involved."


    The purpose here isn't to beat up on Rosenbloom and Rodriguez. They've made a genuine attempt to give the franchise a fresh start by installing new football leadership. And they have improved the dysfunctional culture at Rams Park.

    Moreover, the Rosenblooms were determined to sell to pro-St. Louis interests. They thought they had a good buyer in Khan, the central Illinois businessman who lives within an easy drive from St. Louis. After entering into a purchase agreement with the Rosenblooms, Khan immediately conveyed his pro-St. Louis sentiment and indicated that he wanted to keep the team here.

    But Rams minority ownership partner Stan Kroenke cut off Khan's bid by exercising his contractual right to buy the 60 percent owned by Chip and Lucia. Kroenke must persuade the NFL owners to change their cross-ownership rules to accommodate him.

    And what if Kroenke succeeds? It's widely assumed that Kroenke would be pro-St. Louis with the Rams. He's a Missouri native. A multi-billionaire and highly successful real-estate developer, Kroenke does business throughout the state. He has family here. He has a residence in Columbia, Mo. And he helped bring the Rams here from Los Angeles in '95.

    That said, something struck me as odd the other night when Kroenke disclosed his intentions to buy the Rosenbloom-Rodriguez shares. In his statement, Kroenke said nothing about wanting to keep the team in St. Louis. There was no expression of thanks offered to Rams fans for...
    -04-15-2010, 09:09 AM
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