Shama: Glen Taylor: Equity Group Not in Place for Wolves Sale

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GopherWeatherGuy said:
Posturing publicly has nothing to do whether they are legally entitled to owning the majority of the team. That's what doesn't make sense to me.
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But none of us know the actual facts. None of us what the actual agreement or agreements are between seller and buyer. You are taking Arod/Lore's public pronouncements at face value. But Taylor is also making public statements that contradict Arod/Lore. The truth very likely lies and very ofter lies somewhere in the middle. You appear to be emotionally invested in Arod/Lore owning this team, or at the very least, that Glen Taylor does not. When you free yourself from being high-centered on that position, other possibilities will make more sense.
 

swede2 said:
But none of us know the actual facts. None of us what the actual agreement or agreements are between seller and buyer. You are taking Arod/Lore's public pronouncements at face value. But Taylor is also making public statements that contradict Arod/Lore. The truth very likely lies and very ofter lies somewhere in the middle. You appear to be emotionally invested in Arod/Lore owning this team, or at the very least, that Glen Taylor does not. When you free yourself from being high-centered on that position, other possibilities will make more sense.
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I'm not high-centered on that position. I don't want Taylor to continue to own the team because he's proven he is the worst owner in sports. But I could care less if ARod/Lore or someone else owns it, and if they genuinely don't have the money, then so be it.

In your hypothetical the court of public opinion does not matter. That only matters if Lore/ARod do become the majority owners. You and some others believe they are not close.

I find it really hard to believe they would drag this out legally, and publicly, if they truly believed they did not have the ammunition to win.

The timeline of events backs up both stories. Can the contract expire with pending NBA approval? That is the question that will need to be answered.
 
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GopherWeatherGuy said:
I'm not high-centered on that position. I don't want Taylor to continue to own the team because he's proven he is the worst owner in sports. But I could care less if ARod/Lore or someone else owns it, and if they genuinely don't have the money, then so be it.

In your hypothetical the court of public opinion does not matter. That only matters if Lore/ARod do become the majority owners. You and some others believe they are not close.

I find it really hard to believe they would drag this out legally, and publicly, if they truly believed they did not have the ammunition to win.

The timeline of events backs up both stories. Can the contract expire with pending NBA approval? That is the question that will need to be answered.
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You proved my point - my quote "You appear to be emotionally invested in Arod/Lore owning this team, or at the very least, that Glen Taylor does not."

I don't believe anything about the situation. I don't take what either Glen Taylor or Arod/Lore are saying at face value. I'm also making reckless speculation about Arod/Lore's strategy. What I do know is what I've experienced. Lawyers make a lot of money on clients willing to fight tenuous arguments.

And we don't know whether or not NBA approval is the issue that's an assumption. We don't know what the contract says. We don't know what has transpired. Arod/Lore say that they've peformed but have not specified what that performance consists (and are reluctant to say they've made their payment). Taylor says Arod/Lore have not performed but has not specified what they have or have not done. Each is picking their words somewhat .... carefully isn't quite the word because they'd choose not to use any words if their lawyers could control them. But nobody is actually providing specific details.
 
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swede2 said:
I don't believe anything about the situation. What I do know is what I've experienced. Lawyers make a lot of money on clients willing to fight tenuous arguments.

And we don't know whether or not NBA approval is the issue.
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According to most reports, that is where the argument lies.

Lore and Rodriguez came back with a clause in their purchase agreement that says the buyers get an automatic 90-day extension if they submitted signed financial documents still awaiting NBA approval. Those documents were submitted March 21, six days before the deadline. The approval is in the process. The latest payment would give Rodriguez and Lore 60 percent ownership of the team.

Taylor said Thursday there were certain circumstances for an extension. He said those did not happen.

sports.yahoo.com

A-Rod, Marc Lore: ‘We’re going to be the owners of the Minnesota Timberwolves’

Alex Rodriguez and Marc Lore told Sportico on Friday they're going to be the next owners of the Timberwolves after Glen Taylor backed away from the deal.
sports.yahoo.com sports.yahoo.com
 

swede2 said:
Sure it makes sense. Who cares what they are saying? But they certainly wouldn't come out and say publicly that we want our money back. They are posturing. As I said, purely reckless speculation, but it's not an implausible scenario at all.

I frankly don't care how this works out. I think that from a fan standpoint and specifically of actually having a franchise here long term, Taylor is the better ownership option. The new guys are going to demand an arena very soon. Taylor is going to ask for one later. The new guys don't have the money to fund much, if any, of an arena project. Taylor has that ability (whether or not he would is another story, although he reported to Reusse that for him, it doesn't matter how much money he gets from the franchise, it's going to his foundation). I don't see any of our bodies politic having the stomach to fund an arena (notwithstanding the recent spending orgy). Subjectively I think Taylor has been a lousy owner. Objectively I think Taylor is a better owner than these guys long term.

You seem more invested in Arod/Lore than they are.
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Why would they want their $$ back? They can stay in at the 30% they own now and cash out when Glen sells the team for $3 billion in a couple years.
 


GopherWeatherGuy said:
I have a hard time believing they would drag this out and fight it through the legal system if they didn't have legs to stand on.

If they were truly trying to recoup money, they would just sell the 36% they already own.
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Devil's advocate, they could just be trying to drive up the price on their 36% in their sell back.

Also, the group that ARod roped in a few weeks ago, while they were in on the Suns and previously approved, that was for a much more minor stake 5-6%, then they would be getting with the T-Wolves. Their approval was far from guaranteed by the NBA.

The sense I have been getting is that while the Lore-ARod might have had enough to get to this hurdle, their liquidly to run the franchise going forward would be severely in question.
 

howeda7 said:
Why would they want their $$ back? They can stay in at the 30% they own now and cash out when Glen sells the team for $3 billion in a couple years.
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They might need the scratch for their other business ventures now.
 

howeda7 said:
Why would they want their $$ back? They can stay in at the 30% they own now and cash out when Glen sells the team for $3 billion in a couple years.
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Not a guarantee. The controlling interest is worth much more than nongoverning limited partnership interests. And for guys that seem to be in a bit of a cash crunch, they may be required to bring cash in, particularly with looking luxury tax obligations. Taylor has made capital calls before and it might be necessary again, particularly without a local tv deal.
 

It's not just buying the team - it's having the liquid capital needed to operate the team - a team that is pushing up against luxury tax payments.

according to published reports, most of Lore's net worth is tied up with the food-delivery startup. And A-Rod just doesn't have NBA-owner type money. Some people have suggested that JLo was expected to put in some of the money - but then JLo and ARod broke up.

If a deadline to complete a purchase is coming up within days, and you're still running around trying to find enough money to make it work - that speaks volumes about where ARod's finances were at.

and it's certainly no guarantee that the NBA would have approved the purchase.

Glen Taylor is a past chairman of the NBA Board of Governors. (two terms) He knows how this process works. he is friends with the other owners. unless he did something clearly improper or illegal with the contract, he's going to come out on top.
 



My take:

Lore and ARod just took too long for the money to appear. Long enough for the Tayor group to get increasingly worried about Lore/ARod and mad that Tayor messed up the evaluation to begin with. Tayor is a businessman, and a dick, and took the last opportunity he had to make his move.
 

tikited said:
My take:

Lore and ARod just took too long for the money to appear. Long enough for the Tayor group to get increasingly worried about Lore/ARod and mad that Tayor messed up the evaluation to begin with. Tayor is a businessman, and a dick, and took the last opportunity he had to make his move.
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Lore and ARod should have thrown all the money in asap. It was too much of a bargain not to do so. But just how you shouldnt pay your bill until its due, they thought since Glen wouldnt give up full ownership, they shouldnt pay everything upfront.

They were told Glen is a snake. Not sure why they didnt take that seriously
 

JimmyJamesMD said:
Lore and ARod should have thrown all the money in asap. It was too much of a bargain not to do so. But just how you shouldnt pay your bill until its due, they thought since Glen wouldnt give up full ownership, they shouldnt pay everything upfront.

They were told Glen is a snake. Not sure why they didnt take that seriously
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They probably took it seriously, just couldn't come up with the dough.
 

So now that there have been a few days for everyone involved to ponder the realities of their situation, I thought about how this might end. I haven’t seen the contracts, of course, but it appears likely that there is a colorable dispute that will need to be resolved. (TL;DR Glen should buyout Lore/ARod and everyone should move on.)

I operate from the following assumptions:

**Glen Taylor has far more available resources than Lore/ARod and he has little to lose, other than some legal fees, if he gets successfully sued for breach of contract. The biggest risk to him is that he’s forced to honor the original agreement and, perhaps, pay some penalty under the contract. Not much of a disincentive in my view if he has a chance to sell the team again at a far higher valuation, especially if he has a real concern that his other limited partners might sue him if he does extend the deadline.

**There is a realistic possibility that the NBA doesn’t/wouldn’t approve the new financing for Lore/ARod, essentially rendering their position on the extension moot.

**Neither Lore nor ARod want their capital tied up indefinitely in owning 40% of an NBA team as limited partners where the general partner is a “snake” who may want to hold onto control for the foreseeable future.

**The agreement may well limit the sale of the limited partners’ shares in some meaningful ways, i.e. they may be required to offer their interest back to the general partner or get approval of a buyer prior to selling. Even if it does not, the market for a large chunk of an NBA team without any control is fairly limited.

**The NBA does not want a public dispute or litigation between a current owner (with a long history of service to the league) and potential future owners.

**The NBA would rather that the team sell for more money as that impacts the value of other franchises.

Given all of that, whether through formal mediation or in a deal brokered with the aid of the Commissioner’s Office, I think that a prudent outcome would be for Glen to buy back the Lore/ARod interests at a modest premium. That gets them their money back now to invest elsewhere and accomplishes a divorce with minimal public fuss. Glen is then free to sell to at some point to a better situated buyer at the new market price. Lore/ARod preserve whatever level of goodwill that they have established with the NBA and are better positioned to bid for another team when one becomes available. Lore’s stated childhood dream was to own a team, not to own the Timberwolves.
 



2nd Degree Gopher said:
**Glen Taylor has far more available resources than Lore/ARod and he has little to lose, other than some legal fees, if he gets successfully sued for breach of contract. The biggest risk to him is that he’s forced to honor the original agreement and, perhaps, pay some penalty under the contract. Not much of a disincentive in my view if he has a chance to sell the team again at a far higher valuation, especially if he has a real concern that his other limited partners might sue him if he does extend the deadline.
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I think most of what you wrote makes sense except for this. If the extension/payment is legitimate, and the NBA approves, then Taylor is no longer the majority owner. That is a lot to lose.
 

GopherWeatherGuy said:
I think most of what you wrote makes sense except for this. If the extension/payment is legitimate, and the NBA approves, then Taylor is no longer the majority owner. That is a lot to lose.
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A lot of money is at stake, but he's not appreciably worse off losing in court than he would be if he granted them the extension. Either way, he's just selling at the originally agreed upon price.
 

Glen has someone inside purportedly leaking info to the NY Post. According the the insider, the Wolves are on track to break even this year, with perhaps a modest margin of $5 million to $10 million dependent on a deep playoff run. Next year, because of the huge luxury tax, the Wolves are projected to lose $30 to $40 million assuming the current roster remains in place. Arod/Lore won't have the cash to pay the luxury tax.
 

GopherWeatherGuy said:
I think most of what you wrote makes sense except for this. If the extension/payment is legitimate, and the NBA approves, then Taylor is no longer the majority owner. That is a lot to lose.
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That's implied in the post. What 2nd Degree is saying this that if he loses in ADR or litigation, Glen Taylor is no worse off if he loses in court than if the sale would have been consumated on the 27th.
 

JimmyJamesMD said:
Lore and ARod should have thrown all the money in asap. It was too much of a bargain not to do so. But just how you shouldnt pay your bill until its due, they thought since Glen wouldnt give up full ownership, they shouldnt pay everything upfront.

They were told Glen is a snake. Not sure why they didnt take that seriously
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If they had the money they should have completed the transaction very shortly after the Suns new owner closed his purchase for $4B. The Timberwolves purchase was the deal of the decade and these guys should not have had to chase the money so hard if they were remotely capable financially. Plus, ARod got greedy.
 

Follow the money. The NBA owners do not want this deal, valued at $1.5B, to happen. They want the valuation of their teams to be much higher. They'll kill this deal and let Taylor find a new buyer who's going to pay a much higher price tag. The potential investors that A-Rod was trying to find knew this, and didn't want to be associated with a deal that was going to get killed. Doesn't matter if the payment was made on time or not, the NBA owners are not going to approve A-Rod and Lore as new owners. A-Rod and Lore are doing a publicity tour just to save face, they know the deal is dead.
 

swede2 said:
That's implied in the post. What 2nd Degree is saying this that if he loses in ADR or litigation, Glen Taylor is no worse off if he loses in court than if the sale would have been consumated on the 27th.
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He'll be worse off in the court of public opinion, which I would think at his age would matter some. But at the end of the day that would be just be another L on top of all of the other L's he had delivered to this franchise if he lost.
 
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Full Speed Ahead said:
A-Rod and Lore are doing a publicity tour just to save face, they know the deal is dead.
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I've yet to understand the reasoning behind this. A publicity tour if they are wrong doesn't save face, it makes them look worse and more incompetent.
 

GopherWeatherGuy said:
I've yet to understand the reasoning behind this. A publicity tour if they are wrong doesn't save face, it makes them look worse and more incompetent.
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They're playing the victim card, we're supposed to feel sorry for them. They've done everything right, and it's just the greedy owners and Taylor that are keeping them from owning the team. If there was a chance of the deal going through, they wouldn't be doing the public tour, instead, they'd be doing private discussions with the other NBA owners.
 

GopherWeatherGuy said:
He'll be worse off in the court of public opinion, which I would think at his age would matter some. But at the end of the day that would be just be another L on top of all of the other L's he had delivered to this franchise if he lost.
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I don't think Glen cares much about what people think about him when it comes to money. Have you seen how he dresses?
 

"
GopherWeatherGuy said:
He'll be worse off in the court of public opinion, which I would think at his age would matter some. But at the end of the day that would be just be another L on top of all of the other L's he had delivered to this franchise if he lost.
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"Court of public opinion" was not the subject of the post or of your reply.
 

jamiche said:
If they had the money they should have completed the transaction very shortly after the Suns new owner closed his purchase for $4B. The Timberwolves purchase was the deal of the decade and these guys should not have had to chase the money so hard if they were remotely capable financially. Plus, ARod got greedy.
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So many great comments in this thread. I am with Jamjam. These 2 didn’t have the money to close on the deal of a lifetime.
 



Full Speed Ahead said:
They're playing the victim card, we're supposed to feel sorry for them. They've done everything right, and it's just the greedy owners and Taylor that are keeping them from owning the team. If there was a chance of the deal going through, they wouldn't be doing the public tour, instead, they'd be doing private discussions with the other NBA owners.
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I guess I don't see it that way. I don't think most others do either. They either have the money or they don't after 3 years of this. Even if ARod is right, most people don't have sympathy for him anyways.
 

GopherWeatherGuy said:
I guess I don't see it that way. I don't think most others do either. They either have the money or they don't after 3 years of this. Even if ARod is right, most people don't have sympathy for him anyways.
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In my experience with transactions, generally the big talkers are the small walkers. I think they were poorly coached by their comms team when they did the media tour, particularly if the two primary audiences are the folks in Minnesota and the NBA owners. Using highly inflammatory language and talking in a bombastic fashion, particularly when not filling in a lot of blanks, generally doesn't play well. The response should have been short, simple, firm and then you turn it over to the lawyers.

They made Glen look almost sympathetic, which is pretty hard to do.
 

jamiche said:
In my experience with transactions, generally the big talkers are the small walkers. I think they were poorly coached by their comms team when they did the media tour, particularly if the two primary audiences are the folks in Minnesota and the NBA owners. Using highly inflammatory language and talking in a bombastic fashion, particularly when not filling in a lot of blanks, generally doesn't play well. The response should have been short, simple, firm and then you turn it over to the lawyers.

They made Glen look almost sympathetic, which is pretty hard to do.
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This. I'm involved in a transaction now where opposing party insisted the relevant agreement is iron-clad and vowed a scorched earth campaign to enforce it. Said party has since made a first offer of settlement that is very favorable to my side. We'll end up much closer to our position then he loudmouth position.

FWIW, Glen seems to be combating the Aroid rage with "sources." https://www.espn.com/nba/story/_/id/39857620/minnesota-timberwolves-sale-next
 

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