Mayor Kevin Johnson tweeted this photo with the caption, "I'm pumped!! Ron B & I officially closed the deal a few mins ago - maybe this pic says it best!"
SACRAMENTO, CA - An agreement to build a new entertainment and sports complex in Downtown Sacramento has been finalized, Mayor Kevin Johnson said.
Johnson tweeted Saturday afternoon that an agreement has been reached between Ron Burkle, Mark Mastrov and Vivek Ranadive on a public-private partnership to build an arena at the Downtown Plaza and keep the Kings in Sacramento. Together, the group will invest $1 billion.
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Ranadive, founder of software company Tibco and Golden State Warriors minority owner, and Mastrov, founder of 24-hour Fitness, plus at least 25 local investors are putting up money to buy the Kings from the Maloofs.
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Burkle, part owner of the Pittsburg Penguins and supermarket mogul, and JMA Ventures Inc., owner of the Downtown Plaza, will be leading the effort to build the entertainment and sports complex.
"Once again, we're proving the strength of our market - both as host to an NBA team, but as an emerging region with global potential," Johnson tweeted.
The agreement will keep the Kings in Sacramento for 35 years. Johnson said the deal avoids new taxes, protects the City of Sacramento on the Kings loan and ensures no net impact on the general fund.
Sacramento plans to contribute about $258 million for the $448 million needed to build the arena, while private investors will contribute $190 million. The specific amount that is on the table to buy the Kings from the Maloofs by the Sacramento ownership group has not been released.
Assistant City Manager John Dangberg told residents at a public forum about building the arena that the city will not sell its parking assets, as was the plan last year. Instead, the city will start a non-profit, place the parking assets with it and then issue bonds to help finance the arena.
Johnson tweeted that compared to the previous deal, the agreement with the Burkle-Mastrov-Ranadive group uses more private investment and has more economic development potential.
Sacramento is hoping to block a bid by a Seattle group, headed by Microsoft CEO Steve Ballmer and hedge fund manager Chris Hansen, which has a pending purchase agreement to buy the Kings from the Maloof family and move the team. According to USA Today Sports' Sam Amick the Seattle group has an offer to buy 65 percent of the team from the Maloofs for $525 million.
An NBA Board of Governors relocation subcommittee is planning to meet in New York on April 3. The City of Sacramento is planning to present its counter-offer to the Seattle Group at that meeting.
The NBA Board of Governors is expected to make a decision about the Kings at its meeting April 18 - 19.
The city was expected to release a term sheet after a deal was finalized on Thursday so the public and city council members had a chance to review the details. However, because the city was still talking to investors, the term sheet was not released.
The City of Sacramento released the term sheet Saturday around 7:40 p.m. The 36-page document outlines the deal with the city, the ownership group and the arena development group.
READ TERM SHEET HERE
Read Johnson's full statement below:
I'm pleased to announce an agreement with the Burkle-Mastrov-Ranadive group on a public-private partnership to build a new Entertainment and Sports Complex at the Downtown Plaza Mall. Consistent with our core tenets, the deal avoids new taxes, protects the City on the Kings loan, and ensures no net impact to the general fund. For a comparable investment to the 2012 deal, we've secured more private investment and greater economic development potential at the new site. The new ownership, historic in its reflection of our city's diversity, will invest up to $1 billion in Sacramento; a strong sign of confidence in our market. They will also make a 35-year commitment to keep the Sacramento Kings right here where they belong! Once again, we're proving the strength of our market, both as host to an NBA team, and as an emerging region with global potential. I'm excited to talk further about the deal with my Council colleagues and the public.