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Report: Sacramento Investors Agree to Less NBA Revenue Sharing

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(Sacramento, CA)
Monday, May 6, 2013

The Sports Business Journal says the Sacramento group has agreed not to take any revenue sharing money once the team has moved into a new downtown arena. 

The story also says the group that includes Vivek Ranadive and Mark Mastrov agreed to less than the $18 million it would have received next year under revenue sharing agreement while the team plays in its current home, Sleep Train arena.

According to ESPN.com, the Kings were last in attendance this past season.  Under a revenue sharing agreement between the NBA and the players' union, teams that fare poorly economically receive a share of the league's revenues. 

The Ranadive group has agreed to pay $190 million of the arena's projected $448 million cost.  The City of Sacramento has agreed to sell real estate and lease its parking operations to pay for the rest.

The report also says the Sacramento group promised to pay for "a significant amount" of any cost overruns suffered in the construction of a new arena at the Downtown Plaza mall in Sacramento.

In a term sheet signed in March the group agreed to cover all of the cost overruns.

The Sacramento group has been trying to convince the NBA to deny a Seattle group's bid to buy the team and move it before next season.  The Seattle group is led by hedge fund manager Chris Hansen and Microsoft CEO Steve Ballmer. 

The Kings' current majority owners, the Maloofs, have agreed to sell their shares to the Seattle group, but an NBA relocation committee has recommended against a move. 

The Seattle group has argued a Seattle franchise would be a revenue generator for the league as opposed to Sacramento which would be a revenue recipient.     

The NBA declined to comment on the report, and a spokesman for the Ranadive group couldn't be reached for comment.

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