08-19-2009, 11:26 AM
Join Date: Oct 2007
Bobcats close to completing sale?
Johnson still pursuing Bobcats sale
A deal to sell the team could be struck in next 2 weeks, according to multiple sources.
By Rick Bonnell
Posted: Tuesday, Aug. 18, 2009
Bob Johnson and Houston's George Postolos continue negotiations on a deal that could shift control of the Charlotte Bobcats, multiple sources told the Observer Monday.
Whether a deal is imminent is anyone's guess.
Johnson, who owns about 70 percent of the franchise, put the team up for sale months ago. Postolos, formerly president of the Houston Rockets, has assembled a group of investors. It's unclear whether other bidders are still pursuing a purchase.
In the meantime, many of the team's financial decisions – both large and small – have been put on hold. Sources inside and outside the franchise anticipate the ownership question being resolved in the next two weeks.
Johnson has been in Europe on vacation of late, and is expected in Charlotte sometime this week. Some within the franchise see that as a sign a deal will soon close.
That's no given. While there's no doubt Johnson intends to sell the team – he's losing millions annually – the challenge has been setting a price Johnson will accept. He initially paid a $300 million expansion fee to the NBA, and financed $30 million in start-up capital.
The team is heavily in debt – in excess of $100 million – and any buyer would have to take on that burden as part of the purchase.
One source with knowledge of the situation anticipated a sale weeks ago, right after the team traded Emeka Okafor to the New Orleans Hornets for Tyson Chandler. That deal trimmed about $40 million off the Bobcats' long-term payroll and, the source confirmed, was intended to clean up the franchise's balance sheet in anticipation of a sale.
Johnson has told his minority partners to anticipate tens of millions in losses over the next two years. The team has instituted financial restraints that cancelled a summer-league team and will keep training camp in Charlotte, rather than leaving town for UNC Wilmington.
The team has made no free-agent signings this summer, despite a hole at backup power forward. Starting point guard Raymond Felton, a restricted free agent, remains unsigned.
It's unclear how a sale might change the current front office. Michael Jordan, a minority owner, has control of basketball operations. Jordan hired general manager Rod Higgins and head coach Larry Brown. Brown might be the team's top asset, after making a run at the playoffs the second half of last season.