Seattle-based group looking to buy Sacramento Kings raises offer by $75 million

When the NBA Board of Governors Relocation Committee unanimously recommended last Monday that the Sacramento Kings not be sold to a Seattle-based ownership group intent on relocating the franchise to Washington, it seemed that the effort spearheaded by hedge fund manager Chris Hansen and Microsoft CEO Steve Ballmer to bring back NBA basketball back to Seattle had reached its conclusion. But after the board's decision, Hansen and his partners told supporters eager for the return of the SuperSonics that they "remain fully committed" to completing the purchase agreement they'd reached with the Maloof family to buy a controlling interest in the Kings ... and on Friday afternoon, Hansen and company raised the stakes by once again raising their bid, this time by a cool $75 million.

The initial report of the increased offer by Chris Daniels of KING5 in Seattle was quickly confirmed by Hansen in a public statement on his website:

In an effort to further demonstrate the extent of our commitment to bring basketball back to Seattle, we have elected to voluntarily increase our proposed purchase price for the Sacramento Kings NBA Franchise by $75 million — from an enterprise value of $550 million to $625 million. In conjunction with our revised offer, we have also guaranteed to the NBA that the Franchise would be a revenue sharing payer in all years in Seattle. [...]

While we appreciate that this is a very difficult decision for the league and owners, we hope it is understood that we really believe the time is now to bring the NBA back to Seattle, and that it is paramount that we do everything we can to put Seattle’s best foot forward in this process.

The deal that the Hansen-Ballmer group first struck with the Maloofs would net the Seattle group a 65 percent stake in the Kings at an overall franchise valuation of $525 million. Two and a half months later, after Sacramento Mayor Kevin Johnson had gathered a base of local investors headed by billionaires Mark Mastrov, Ron Burkle and, later, Vivek Ranadive and the Jacobs family aiming to purchase the Kings from the Maloofs and keep the team in Sacramento, Hansen and his group voluntarily upped their offer by $25 million, "from an enterprise value of $525 million to an enterprise value of $550 million."

Friday's re-raise would increase the out-of-pocket outlay for the Seattle group to approximately $422.5 million. Hansen and company have reported already placed $357 million in escrow at the ready to complete the purchase; the Ranadive-led Kings group reportedly does not yet have the full $341 million for its competing bid in escrow.

Adding to the bid is one thing. Committing to be a team paying into the league's revenue sharing pool, rather than taking from it, might be another. Ranadive recently pledged to forgo millions in shared revenues in the apparent hope of helping persuade the NBA's owners to vote to negate the Maloofs' sale to Seattle. The Hansen group's commitment to not only decline any such revenues, but also to pay into the kitty, would seem to represent a step beyond.

Hansen also notes emphasized the headway the prospective Seattle ownership group has made in its arena project, which is further along than the Sacramento group's plan at this stage of the game.

After Hansen released his statement, Sacto mayor Johnson offered one of his own (via Jonathan Santiago of Kings blog Cowbell Kingdom):

"We feel very confident about the position we are in right now. The NBA leadership and owners have always said that their decision would not be dictated by a bidding war. This was always about whether Sacramento, a community that has supported the NBA for 28 years, can put together a plan and organization to ensure the franchise can rebuild and thrive. The ownership group, the city, and the community have shown the NBA, without any shred of doubt, that the Sacramento Kings belong in Sacramento. I believe the NBA owners realize that there is far more to think about than just an increased bid. They know what this story means to the league. We look forward to talking with all of them again in Dallas.”

ProBasketballTalk's Aaron Bruski reports that the issue has less to do with the price offered by the Seattle group than it does about the league's commitment to Sacramento:

That perspective jives with comments allegedly made to a fan via Twitter direct message by Miami Heat owner Micky Arison, one of the 12 members of the Board of Governors Relocation Committee.

"The question before the committee is 'Has [Sacramento] done all it should to keep the team?'" Arison reportedly wrote. "The answer is yes. It's not a vote about Seattle."

The owners who make up the Board of Governors are expected to cast their final, deciding vote on the proposed sale to the Seattle group and the possible relocation of the Kings in Dallas on May 15. It's expected that they'll follow the relocation committee's recommendation to deny the Maloofs' sale to Hansen and company; whether an increased bid will in any meaningful way change that feeling remains to be seen.