Rams sale has Kroenke & Goodell doing the Ownership Tango
NFL Commissioner Roger Goodell has stuck to his guns so far regarding ownership of the St Louis Rams
- Image by Getty Images via Daylife
Stan Kroenke & Roger Goodell have been dancing around the real issue for more than a month. Namely, who is going to own the St Louis Rams when the move to Los Angeles?
Kroenke has quietly played his position throughout the complex sale of majority ownership in the St Louis Rams. Stan already owns 40% of the team. The remaining 60% was recently offered for sale by fellow part-owners Chip Rosenbloom & Lucia Rodriguez, who want out of the Rams business altogether. An offer has been made for those shares, but the situation gets dicey from there.
Auto parts entrepreneur Shahid Khan put an offer on the Rosenbloom-Rodriguez shares on February 12th, and the NFL stipulates a 60-day period for review of such offers. That puts a deadline for a decision on Khan’s proposal at April 12th. The league’s 9-owner Finance Committee won’t say so, but they have reviewed Khan’s finances and are prepared to recommend approval to the rest of the league’s owners.
This is where things get sticky…
Kroenke clearly wants majority, if not outright, ownership of the Rams. However, league regulations stipulate that Stan cannot be a majority owner of an NFL team while he maintains majority ownership of a franchise in a competing major sport in a competing NFL city. Kroenke owns the Colorado Avalanche & the Denver Nuggets, and Denver is, of course, home to a competing NFL franchise in the Broncos. Kroenke also owns the Colorado Rapids of the MLS.
Without violating the league’s rules, Kroenke only has two options: maintain his 40% share and bend to the will of a future majority owner, or go the way of Rosenbloom & Rodriguez by simply selling and getting out of the way.
Those less palatable options aside, Kroenke reserves the right, based on his 40% ownership, to exercise first refusal of Khan’s purchase offer. That means Stan can flex his partial-ownership muscle and refuse Khan’s offer by matching it with an equal offer. Such a move would clearly be in violation of league regulations, but would also force Commissioner Roger Goodell to make a ruling on the matter. Rumors have stirred in recent weeks that Goodell may be willing to bend the rules and allow Kroenke to buy the remaining shares of the Rams anyway.
But why would Stan Kroenke want to buy the St Louis Rams when his major investments are all in Colorado? Two reasons:
1) Kroenke has been expanding his ownership scope after having considerable success as owner of the Nuggets, Avalanche & Rapids. He has been busily purchasing shares of the British Premiere League’s Arsenal, proving an appetite for expansion of his sports empire.
2) The Rams have been rumored for the last couple years to be on the move. This losing franchise with declining attendance could be a boon for a city without a current NFL team… a city such as former Rams owner Los Angeles. The financial boon would be considerable should the Rams move, especially if the team ends up in a sizeable market.
The prevailing opinion is that NFL Commissioner Roger Goodell will be inflexible in enforcing the league’s regulations. Said Goodell of the situation, “Let’s cross that bridge when we come to it, but I don’t think so. Everyone knows we are going to respect our policies and treat everybody the same.”
However, it is hard to believe that Kroenke would be taking such considerable time in making a decision regarding the sale to Khan if he didn’t believe that full ownership of the Rams was possible. Keep in mind that, with his 40% of the team and two other part-owners in the mix, Kroenke was a sort of de-facto majority Rams owner to this point. He certainly doesn’t want to lose that advantage if he can help it, but he also doesn’t want to ditch his shares and miss out on an opportunity to reap the financial rewards from the nearly inevitable movement of the Rams out of St Louis.
For Goodell’s part, he talks a big game, but the NFL is a business first. He may well be using this opportunity to inflate the price and leverage a measure of control over where the Rams land in the end. No doubt, Roger Goodell wants the Rams to find their way to Los Angeles, far and away the biggest untapped NFL market in North America.
(There is more stickiness here, as the move to LA may not benefit other owners past 2011 when the current labor peace in the NFL, and the revenue-sharing associated with it, comes to an end.)
The NFL wants the Rams in Los Angeles, Kroenke wants to make a boatload of money moving them there. The only reason that an exemption won’t be made for Kroenke is if Khan has already indicated that he plans to utilize his majority ownership to move the team. (Alternatively, it is highly unfair to make an exemption, but the NFL traditionally does want it wants, fairness be damned.)
In the end, it is highly unlikely that Kroenke will sell his shares. If he can’t be the one to orchestrate the deal for moving the Rams to LA or elsewhere, he will at least hang around long enough to reap the rewards. And if Khan buys St Louis and begins shopping the team around, we could see a whole new dance begin between Kroenke & Khan.
How can you possibly say Kroenke clearly wants majority, if not outright, ownership of the Rams? What facts do you have to back this statement up? I’ve read some terrible articles on Rams ownership, but this is by far the worst.
I wont even discuss how ignorant reason number 2 is. Try doing research before writing on this subject.
Also, you do realize Khan has been the guest at two Nuggets games and Kroenke has even introduced him to the press. That sure sounds like 2 people ready to do battle of the Rams.
Calm down there, Sparky. I take it you’re a St Louis fan? It’s okay, when all is said and done you can drive to Arrowhead for Chiefs games.
Reason #2 has been a rumor for years, and the sale process has reignited that talk. Here’s the oldest article I could find on the subject.
http://sports.yahoo.com/nfl/news?slug=ms-trippintuesday052008&prov=yhoo&type=lgns
Add to that the fact that a group of LA businessmen have already purchased the land to build a new NFL stadium. As soon as a deal is available, there’s a boatload of money waiting to move your team to SoCal.
http://en.wikipedia.org/wiki/Los_Angeles_Stadium
And Kroenke hosting Khan at his team’s games is just as likely to be Stan showing off his assets as anything else. Or, if they do plan to work together, they’ll need to be able to stomach each other. Either way, don’t expect Stan & Shahid to be going on any buddy-time fishing trips anytime soon just because they shared a luxury suite.
Funny how his article is already getting raining truth… hopefully reason 2 follows shortly .
feeling kinda stupid Keith?
Nice article Ian
Good guess on Kroenke matching the offer, although you might want to do some more research on the players involved.
Kroenke is from Missouri, was part of the expansion effort in the early-’90s and was instrumental in bringing the Rams to St. Louis. His loyalty is with St. Louis, not Los Angeles.
In fact, he had to sign a special agreement with the NBA when he purchased the Nuggets, because David Stern figured Kroenke would try and move the team to St. Louis.
As for Chip Rosenbloom and Lucia Rodriguez, I just get the sense that you don’t realize they’re brother and sister. They inherited the team from their mother, Georgia Frontiere.
Anyway, whether it’s Kroenke, Khan or Dave Checketts, it doesn’t look like the Rams are going anywhere.
That has to be one of the most uninformed pieces of garbage I’ve ever read in my life.
Kroenke is from Missouri and was instrumental in the Rams moving to St. Louis.
What, if any facts do you have that even remotely hint at the idea that Kroenke would even consider moving the team?
This is worse than the garbage that all of the LA yahoos post on STLToday.com
LA Rams – R.I.P. 2/17/95
GET OVER IT!