Reflection on Russian Billionaires and Ownership
Sep 23, 2009 Brooklyn, Bruce Ratner, Mikhail Prokhorov, Opinion
As a Nets fan, there hasn’t always been a lot to be excited about. There were back-to-back trips to the Finals a few years ago. There was the trade for Vince Carter a few years after that. Otherwise, I haven’t been truly, honestly excited as a Nets fan since the team was up 1-0 on the Miami Heat during the 2006 Playoffs. Since that game, the Nets have made the playoffs, and played some great games, and have now laid the foundation for a good, young team that could be competitive in the near-future, but I can’t say I have been excited. I was rooting for the Nets, of course, because I rooted for them when Butch Beard was the coach and Shawn Bradley was the center. But rooting and excitement are not always one and the same.
The announcement that Russian billionaire Mikhail Prokhorov has purchased a majority stake in the Nets has me excited. Yes, the deal still needs to be approved by the NBA. Prokhorov has a questionable past and has been compared by some to be the Russian version of Mark Cuban because of his outspokeness, which will irk many. I must also keep in mind that while bringing the Nets to Brooklyn is a priority for Prokhorov, and a move to Brooklyn would give the Nets significantly better odds to land a top free agent next summer, his taking ownership of the team guarantees neither of these things. All it does is provide hope.
As Tom Ziller writes at NBA Fanhouse, Prokhorov is not going to be shy about spending his billions on the Nets. By all accounts, the guy is a passionate businessman, who wants to make money, but also wants to make a splash. I’ve never pulled for a team that had a George Steinbrenner or Mark Cuban type at the helm – someone who may drive people crazy, but also becomes a god to fans for his desire to win. As a fan of teams who have always played it conservatively, or have been good citizens in the league, I’ve publicly said I’ve hated teams like the Yankees or the Mavs, but I’ve always envied the desire of their ownership.
I think it’s safe to say that when Bruce Ratner bought the Nets, his priority was the Atlantic Yards Development first, and the product on the court a distant second. The acquisition of Vince Carter was a sort of mea culpa for giving away Kenyon Martin, but Ratner never showed interest in building a winner. Between the Nets cap space next summer and Prokhorov’s reputation as a free-spender, I have no doubt that an effort will be made to acquire every big name that’s out there. Prokhorov is not going to be the NBA’s first foreign owner to fail – he wants to win.
There are things about this deal that certainly make me uneasy. As Dave D’Alessandro implies, the current front office of Rod Thorn and Kiki Vandeweghe could be shown the door under a new ownership. It’s a common casualty of ownership changes like that, but that doesn’t make it right. Thorn had the vision to make this team a contender in the first place when he acquired Jason Kidd before 2001. Losing someone with his experience and saavy would hurt.
But I think the good far outweighs the bad here, and that’s before we bring Brooklyn into the equation. Opponents of the move will say it’s never going to happen – they’re going to throw more lawsuits out there to delay the process and upend the development. They might succeed. But again, Prokhorov isn’t looking to come into the NBA to be a second class citizen. If the NBA approves Prokhorov as many expect, it will be a clear signal that David Stern and others want basketball in Brooklyn more than anything – even if that means bringing in a Russian oligarch with a questionable past who might become a headache a la Mark Cuban.
Nets on the Net: 9/23/09 Russian Oligarch Edition
Sep 23, 2009 Brooklyn, Bruce Ratner, Kiki Vandeweghe, Lawrence Frank, Rod Thorn
Here’s a wrap-up of some non-Prokhorov news for the day:
As the off-season comes to a close, Slippery When Nets gets nostalgic for the Nets finest season, 2001-02.
Rod Thorn, Kiki Vandeweghe and other Nets representatives will participate in the Capstone Global Markets Charity Day, sponsored by hedge fund Capstone, to support research focused on finding a cure to Batten Disease.
Atlantic Yards Report runs a letter from the NYC Transit Riders Council, expressing their outrage regarding the Metropolitan Transportation Authority’s Agreement to accept incremental payments of $20 million for property needed to build the Atlantic Yards development.
Lawrence Frank talks some more about life without a “Big Three” with The Baseline at Sporting News.
The Blowtorch envisions a conversation between Jay-Z and a Russian businessman.
We have a winner in the “Take a Net to School” contest.
Develop Don’t Destroy Brooklyn: Some Additional Reaction
Sep 23, 2009 Brooklyn, Bruce Ratner, Develop Don't Destroy, Mikhail Prokhorov
NetsAreScorching asked Daniel Goldstein, spokesman for Develop Don’t Destroy Brooklyn, one of the primary groups opposing the Atlantic Yards development plan that would bring the Nets to Brooklyn, for some additional reaction regarding the team’s sale to Russian oligarch Prokhorov today:
NAS: Does this announcement of Prokhorov taking a controlling stake in the Nets change how opponents of the Atlantic Yards development plan to fight this project in the coming months?
DDDB: The answer is no, other than to make sure that our city, state and federal elected officials, as well as the NBA, does their proper due diligence on vetting Mr. Prokhorov.
NAS: If this deal is approved by the NBA, is there any doubt on your end that Ratner will have the finances he needs to go forward on this project?
DDDB: This deal does basically nothing to help Ratner with the arena financing or the financing for the rest of the project. The $200 million reportedly coming from Prokhorov presumably goes, mostly, to buy out the Nets owners (not sure if that includes Ratner in full or in part) who wanted out from the team. It doesn’t appear to be going toward the project or the arena construction. Even if it is in part or in full, it is a long way from the total financing Ratner needs.
NAS: How critical does the hearing on Oct. 14th in Albany become now to the future of the AY opposition?
DDDB: No more or less critical today than it was yesterday. Ratner has legal hurdles and financial hurdles. The legal hurdles didn’t change today, and while the financial hurdles may have changed a bit, this is clearly not where Ratner wanted to be. His potential deal with Prokhorov, if it survives scrutiny seems to be a desperate deal of last resort that doesn’t go far enough for Ratner. On top of that, today’s announced deal brings even more moving parts in while diminishing Ratner’s control.
NAS: In your release, you bring up some of Prokhorov’s questionable background, but the FCRC statement includes comments from NBA commissioner David Stern who has seemingly endorsed this deal. What do you think that says for the current state of the NBA, financial and otherwise?
DDDB: I don’t think it says anything good about the NBA. But they can’t simply turn the other way and not do their due diligence. We have little doubt that Stern is desperate to get the Nets out of the Meadowlands, and that means he’ll go very far to make sure his owners approve a very questionable deal. But lawyers may not allow him to be as desperate as he is. We’ll see what happens.
Breaking News: Prokhorov/Ratner Sign Letter of Intent to Partner on Atlantic Yards Development
Sep 23, 2009 Brooklyn, Bruce Ratner, Develop Don't Destroy, Mikhail Prokhorov
Forest City Ratner Companies and Russian oligarch Mikhail Prokhorov’s Onexim Group announced today that they have agreed to sign a letter of intent to create a strategic partnership to develop the Atlantic Yards in Brooklyn, the proposed future home of the Barclays Arena and the Nets (AP via SI).
Here are some details from a Forest City Ratner Enterprise press release on the Nets home page:
In accordance with the agreement, entities to be formed by Onexim Group will invest $200 million and make certain contingent funding commitments to acquire 45% of the arena project and 80% of the NBA team, and the right to purchase up to 20% of the Atlantic Yards Development Company, which will develop the non-arena real estate.
Bruce Ratner, the Chairman and CEO of FCRC, said, “Mikhail and Onexim will be great partners for this project. I am thrilled that smart global investors appreciate the exciting economic potential of Brooklyn. We are one step closer to achieving our goals of creating much needed jobs and economic development for Brooklyn and the city.”Mikhail Prokhorov, President of Onexim Group, said “We are delighted to join in this exciting project and to participate in the landmark development of global sports in this entertainment arena in the heart of New York City. I have a long-standing passion for basketball and pursuing interests that forward the development of the sport in Russia. I look forward to becoming a member of the NBA and working with Bruce and his talented team to bring the Nets to Brooklyn.”
NBA Commissioner David Stern said, “We are looking forward to the Nets’ move to a state-of-the-art facility in Brooklyn, with its rich sports heritage. Interest in basketball and the NBA is growing rapidly on a global basis and we are especially encouraged by Mr. Prokhorov’s commitment to the Nets and the opportunity it presents to continue the growth of basketball in Russia.”
Develop Don’t Destroy Brooklyn, one of the primary opponents of the deal has issued their own statement via spokesman Daniel Goldstein:
“This has got to be a huge wake-up call for Ratner’s political supporters. The only reason Ratner would make this deal is because he is in dire financial trouble. If Ratner has to go overseas to get major funding for the arena, how on earth is he going to finance the rest of the project?”
The deal would have to be approved by the NBA’s board of govenors, according to the AP.
Well folks, this is pretty huge. We’ll see where things legally stand once the Oct. 14 hearing in Albany regarding the use of eminent domain for the project passes, but considering it’s only been about a week since the “richest man in Russia” was linked to the Nets and this deal was announced, things are clearly moving at an accelerated pace with the end of the year still being the supposed finish line for Brooklyn to happen.
Book Review: John Calipari’s “Bounce Back”
Sep 23, 2009 Jayson Williams, John Calipari, Kendall Gill
As I’ve discussed previously, the John Calipari era in New Jersey has always been a curious one for me. There was one great, entertaining season in 97-98, when the team won 43 games and made it to the first round of the playoffs and fighting hard against the Bulls before getting swept away by the eventual champions. That season was sandwiched between two agonizing ones, including the lockout-shortened 1999 season where the team lost starting point guard Sam Cassell, started the season 3-17, and Calipari was fired.
When Calipari came to the Nets from the University of Massachusetts, he was known for being a little high-strung and abrasive. People said he was an Xs and Os wonk who demanded a lot from his players – maybe too much. In the closing days of Calipari’s tenure in New Jersey, all of these bad traits came to a head. His players, most notably Jayson Williams, publicly criticized him. The Nets new ownership group at the time, didn’t back him. He got into major trouble, when he referred to a reporter as an “Mexican Idiot.”
A lot of this history is rehashed in Calipari’s new book “Bounce Back: Overcoming Setbacks to Succeed in Business and Life.” Part self-help book, part-biography, Calipari uses his New Jersey firing as the primary impetus for his motivational spiel, citing it as the “rock bottom” of his professional career. The book is Calipari’s opportunity to set the record straight, while showing how he’s grown from the fiasco.
Which is what makes “Bounce Back” so curious. Throughout the book, Calipari litters the text with classic self-help clichés, telling readers to believe in themselves, and to get out from under the covers. He uses his life as an example of coming back from the depths of despair – the problem is, there is not a whole lot about Calipari’s life that I think the common man could identify with and be inspired by.