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Flasteel
09-18-2008, 09:03 PM
Looks like the brothers are going to wind up keeping it in the family. They have to sell to a majority owner (30% at least) and if the NFL boys club wouldn't allow a guy like Druckenmiller in, I can't imagine them even considering anyone else. Too bad, this guy sounds like a class act and a die-hard fan (who would keep his hands off the operation).

I'm also a big fan of the Rooneys, so this is cool by me. On the other hand, I just hope this doesn't wind up strapping them to the point they start spending the minimum cap amount.


ROONEYS SAY NO TO DRUCKENMILLER
Posted by Mike Florio on September 18, 2008, 8:07 p.m.
So the four Rooney brothers not named Dan need to sell their interest in the team because of their gambling interests, and Pittsburgh native Stanley Druckenmiller is ready to cough up $800 million for 64 percent of the team.

And the four Rooney brothers not named Dan have declined the offer.

Druckenmiller told the Pittsburgh Post-Gazette that he is “disappointed.”

It’s unclear whether this means that Dan Rooney has come up with a way to buy out his brothers, whether the league has given them even more time to work it all out, or whether the four Rooney not named Dan have decided to drop their gambling interests that violate NFL rules and keep their stake in the team.

Here’s Druckenmiller’s statement:

“Seven months ago, I was approached by members of the Rooney family about purchasing their interest in the Pittsburgh Steelers. I engaged in discussions about a possible transaction because a number of family members told me that, after years of effort, they were unlikely to be able to resolve the estate planning and NFL ownership matters of great concern to them.

“If an external solution was necessary, I believed that I could provide the family with an appropriate transaction that also would be in the best long-term interests of the Steelers, the NFL and the city of Pittsburgh. The solution I proposed included a request that Dan Rooney continue to manage the Steelers organization.

“Throughout our discussions, I made clear that if the family could resolve these matters internally it should do so and I would gladly remain only a devoted Steelers fan. Based on recent developments, it has become clear that the Rooneys need substantial additional time to assess their options. I do not wish to complicate these efforts, and I also do not want the lingering uncertainty about my possible involvement to become a distraction to my business and my family.

“For these reasons, I have removed myself from the process. On a personal note, having spent time with all five Rooney brothers, I have come to hold them all in high regard, and it is easy to see why the organization has been so successful. Given my love for Pittsburgh and what I know the team means to the city, I wish them all the same success they have had in the past. Go Steelers!”

NKySteeler
09-18-2008, 09:07 PM
:Beer Who hoo!......

SteelerNation1
09-18-2008, 09:14 PM
I think their trying to maximize their $. I actually wouldn't have minded Druck buying the team. New money might not have been the worst thing.

NKySteeler
09-18-2008, 09:23 PM
I think their trying to maximize their $. I actually wouldn't have minded Druck buying the team. New money might not have been the worst thing.

SN1, I realize the whole money thing, but I guess I'm just too set in my views of tradition, and in the minority on the issue... But I'm happy with the team remaining within the family.

buckeyehoppy
09-18-2008, 09:25 PM
Some mixed emotions come out of Druckenmiller's decision to back away. He seems like a great guy and that he could have been a great owner for the Steelers. But, when the smoke clears, this will be the best thing for the brothers and, ultimately, the Steelers.

This is a monumental decision for the brothers, as it also goes to the settlement of their estates. I'm glad they are taking every precaution to ensure that their affairs get settled appropriately and with as little acrimony as possible. That seems to be the goal at this point.

Ultimately, I would hope that Dan and Art II can work this out so that they can retain majority ownership. The league is obviously on their side and they have done so much for the league that the league will do what it can to ensure their continued contribution.

RussBII
09-18-2008, 09:34 PM
I hope this means that the Steelers are staying Rooney owned and Rooney run. I would hate if the team were sold to someone who wasn't Druckenmiller, given the classy way he has handled this. The above quotes just show what kind of guy he is.

Either that, or he has a helluva PR department.

Eddie Spaghetti
09-18-2008, 09:38 PM
sounds like one hell of a conference call.

stlrz d
09-18-2008, 09:39 PM
I think their trying to maximize their $. I actually wouldn't have minded Druck buying the team. New money might not have been the worst thing.

Agreed.

RuthlessBurgher
09-18-2008, 10:52 PM
If he truly is the Steeler fan that he claims to be, he would agree to become a hands-off minority investor (like the McGinleys) that would help Dan finance the sale without absorbing a massive amount of debt. Up to this point, he said that he was only interested in purchasing a controlling share of the team. We would know he was truly impressed with the Rooney brothers if joined the ownership group to keep the team in Rooney hands instead of opposing the bid to keep the team in Rooney hands.

Perhaps if Dan could throw a quarter of a billion dollars at his brothers to obtain another 25% of the team (in addition to the 16% he already owns) which would give him 41%, then Druckenmiller could help out by buying 39% of the shares for $390,000,000, with the McGinleys holding the remaining 20%. Just a thought.

NKySteeler
09-18-2008, 11:08 PM
If he truly is the Steeler fan that he claims to be, he would agree to become a hands-off minority investor (like the McGinleys) that would help Dan finance the sale without absorbing a massive amount of debt.

Yes, but he would be doing it out of pure "fandom"... The McGinleys were in it due to marriage, and family. While Barney NcGinley was a boxing promoter involved with Art Sr. (and future part-owner), his son, Jack, married Art Sr.s' sister Marie... SD has no other ties other than pure "fandom". Would it be enough?

Flasteel
09-18-2008, 11:22 PM
If he truly is the Steeler fan that he claims to be, he would agree to become a hands-off minority investor (like the McGinleys) that would help Dan finance the sale without absorbing a massive amount of debt.

Yes, but he would be doing it out of pure "fandom"... The McGinleys were in it due to marriage, and family. While Barney NcGinley was a boxing promoter involved with Art Sr. (and future part-owner), his son, Jack, married Art Sr.s' sister Marie... SD has no other ties other than pure "fandom". Would it be enough?

What fan, provided they have the cash flow, wouldn't jump at the chance to be any part owner of their team, especially this team. Besides the potential return on his investment and legacy to his children, I'm sure there are other perks even Stanley would appreciate.

NKySteeler
09-18-2008, 11:25 PM
What fan, provided they have the cash flow, wouldn't jump at the chance to be any part owner of their team, especially this team. Besides the potential return on his investment and legacy to his children, I'm sure there are other perks even Stanley would appreciate.

It is definitely an interesting concept. Guess we'll just have to wait and see how it pans out... If he could be the type to remain "hands-off" while the Rooneys retain majority, I'd be all for it.

costanza2k1
09-18-2008, 11:48 PM
Wuss...

If the man couldn't pursue what he wanted with all that he had then he didn't deserve to be the owner.

RuthlessBurgher
09-18-2008, 11:51 PM
If he truly is the Steeler fan that he claims to be, he would agree to become a hands-off minority investor (like the McGinleys) that would help Dan finance the sale without absorbing a massive amount of debt.

Yes, but he would be doing it out of pure "fandom"... The McGinleys were in it due to marriage, and family. While Barney NcGinley was a boxing promoter involved with Art Sr. (and future part-owner), his son, Jack, married Art Sr.s' sister Marie... SD has no other ties other than pure "fandom". Would it be enough?

In this era of a housing crisis in which major insurance companies are going belly up, you want to put your money in a solid investment. Who ever heard of an NFL franchise losing value? Even the most poorly run organizations like the Lions, Bengals, and Cardinals are worth increasingly more money year after year when the Forbes estimates come out, and he would be investing in perhaps the most stable franchise of them all.

We all know that the Steelers were started with $2500 in 1933 and are worth about a cool billion 75 years later. That an increase of 400,000 times the original investment! Kind of an extreme example, I know. To give a more applicable modern example, Jerry Jones bought the Cowboys in 1989 for $150 million. The estimated worth of that franchise now is $1.5 billion. How can you even comprehend an investment that increases 10 times in value in less than 20 years with no real risk of collapse? The NFL is as stable an investment as you are going to find these days. He can plunk down several hundred million now for a minority ownership stake and just watch the overall value of that investment just grow and grow as the years roll on. His own personal fandom is the icing on the cake.

Oviedo
09-19-2008, 07:28 AM
Druckenmiller would have been the ideal "angel investor." I hope the Rooney don't cut off their noses (and the organizations) to spite their faces just to keep the Rooney name at the top of the organization chart.

SteelerNation1
09-19-2008, 09:44 AM
Druckenmiller would have been the ideal "angel investor." I hope the Rooney don't cut off their noses (and the organizations) to spite their faces just to keep the Rooney name at the top of the organization chart.
Ov,
We're on the same page. This is very concerning IMO

SteelTorch
09-19-2008, 11:28 AM
Am I the only one who's concerned about this? Druckenmiller would have (hopefully) kept the team in Pittsburgh. Rooney is not getting any younger, his time with the team is short. And what other brother would be interested in running them, let alone competent enough to do it? :?

Oviedo
09-19-2008, 11:38 AM
Am I the only one who's concerned about this? Druckenmiller would have (hopefully) kept the team in Pittsburgh. Rooney is not getting any younger, his time with the team is short. And what other brother would be interested in running them, let alone competent enough to do it? :?

I repeated have stated the same concerns. Druckenmiller doesn't have to worry about money because he is insane rich. His sources of income are none NFL related. The Rooney's only source of income is the Steelers. They have to tap the Steeler revenue streams to pay all the bills including their own incomes. Adding debt into that equation is very bad. Here is one possible result: We can never spend to the salary cap because about $10M per year will have to be diverted to service the debt and interest on that debt. That will probably come out of the operating budget. If you think we haven't been a player in free agency in the past, just wait.

Bad move on the part of the Rooneys.

RuthlessBurgher
09-19-2008, 11:45 AM
Am I the only one who's concerned about this? Druckenmiller would have (hopefully) kept the team in Pittsburgh. Rooney is not getting any younger, his time with the team is short. And what other brother would be interested in running them, let alone competent enough to do it? :?

Dan's son Art II has been President of the Steelers since 2003. He's in his mid-50's. Dan, now in his mid-70's, has been the Chairman of the Steelers since then, representing the team at league functions, but his son Art II has been steering the ship regarding the day-to-day operations for the past 5 years.

It is similar to how Dan ran the team as President throughout the 70's and 80's while his father the Chief was Chairman during that time. The torch has been passed already. Dan's son is running the show. None of Dan's brothers will be involved.

RuthlessBurgher
09-19-2008, 12:12 PM
According to this ESPN article, Druckenmiller's offer to the 4 Rooney brothers was believed to be in the neighborhood of $550 million. Since those 4 brothers own 64% of the shares of a team whose value was estimated at roughly a billion dollars, you would think that they would be looking for $640 million. Perhaps it wasn't Dan who was low-balling his brothers...perhaps it was Druckenmiller who was giving a less than market value offer (albeit an everything up front in cash offer as opposed to Dan's payouts stretched out over several years).

http://sports.espn.go.com/nfl/news/story?id=3596666


Billionaire Druckenmiller withdraws offer to buy majority share of Steelers
ESPN.com news services

Updated: September 19, 2008, 9:38 AM ET

PITTSBURGH -- A billionaire suitor withdrew his offer to buy a majority stake of the Pittsburgh Steelers on Thursday, saying the Rooney family needs more time to consider its options about the future ownership of the team.

Stanley Druckenmiller issued a statement Thursday night saying he "removed himself from the process."

The Pittsburgh Post-Gazette reported that Druckenmiller withdrew after he was informed by four of the five Rooney brothers that his offer for their shares, believed to be in the neighborhood of $550 million, would not be accepted.

"Of course I'm disappointed," Druckenmiller told the Post-Gazette. "But those are their shares and they have every right to seek a higher price for them."

Members of the Rooney family approached Druckenmiller seven months ago about buying their shares of the team to help resolve estate planning and NFL ownership matters, Druckenmiller said. Druckenmiller is the chairman of Pittsburgh-based Duquesne Capital Management and a Steelers season-ticket holder.

At least three of the five Rooney brothers -- sons of team founder Art Rooney Sr. -- want to sell their equal shares. Managing partner Dan Rooney, who has run the team since the early 1970s, also owns only 16 percent himself.

Druckenmiller said he made it clear throughout the discussions that if the family could resolve its problems internally, he would step away. He also said that if his bid succeeded, he would ask Dan Rooney and his son, Art Rooney II, to stay on as managing owner and team president, respectively, according to the Post-Gazette.

"Based on recent developments, it has become clear that the Rooneys need substantial additional time to assess their options," Druckenmiller said in a statement. "I do not wish to complicate these efforts, and I also do not want the lingering uncertainty about my possible involvement to become a distraction to my business and my family."

Earlier Thursday, Art Rooney Jr. -- one of the four brothers seeking a sale -- said he expected a deal to sell the shares will be done soon.

"My feeling on that is, if you want to do something right, you don't want to do it on a timeline," he said. "Although these things do stretch on, I thought we'd have some kind of understanding by the preseason, and now we're coming up on the third game of the season and you don't want it to drag out."

Rooney did not return messages seeking comment on Druckenmiller's withdrawal.

At least three of the five Rooney brothers want to sell their equal shares in the team partly to avoid costly future inheritance taxes for their children and grandchildren. The McGinley family, cousins to the Rooneys, owns the other 20 percent and is reportedly not interested in selling shares.

Dan Rooney and Art Rooney II are attempting to buy enough shares to be the primary owners. But their two previous offers are believed to be for less money than the other four Rooney brothers could sell for on the open market.

But in a meeting with the Rooney family last month, NFL commissioner Roger Goodell reportedly indicated that the league strongly favors the family retaining control of the franchise. A sale would require the support of 24 of the NFL's 32 owners.

The NFL has rules that restrict owners' involvement in gambling enterprises, and requires that one person own at least 30 percent of a team. Some of the brothers own shares of racetracks that now offer casino gaming.

Dan Rooney and the Steelers have repeatedly refused comment on the negotiations.

The four brothers have hired the investment firm Goldman Sachs Group Inc. to calculate the value of their shares, while Dan Rooney has turned to Morgan Stanley for guidance in the matter. Goldman Sachs estimates that one of the NFL's most successful franchises could be worth as much as $1.2 billion. Forbes earlier this month estimated the team's value at just over $1 billion.

Art Rooney Jr. said his brothers are consulting their financial advisers on Thursday and again Friday.

steelblood
09-19-2008, 12:35 PM
This worries me. The Steelers need to get this resolved and resign Kemo. Yesterday.

papillon
09-19-2008, 12:35 PM
This deal was scuttled by the NFL at the behest of Dan Rooney. The good ol boy network didn't want an outsider owning and running the Steelers. There were enough NFL owners in Dan's corner to block the sale to Druckenmiller. It simply wasn't going to happen.

If I were Druckenmiller, I'd hire some attorneys and private investigators and look for collusion. MLB was able to prove it, I'm sure this one can't be that difficult to prove either.

Regardless, if the brothers allow Dan and Art to pay them off over time, it masy not be so bad; otherwise, this could put the Steelers in jeopardy from a cash flow position.

The best thing that could happen to the Steelers at this point would be for the brothers to sell their gambling interests and fade into the sunset. Of course, this isn't going to happen, because the gambling is a cash cow and steady flow of millions of dollars every year. Why give up future paychecks just to keep the Steelers in the Rooney family?

The brothers also have no interest (except, maybe Art) in having anythign to do with the NFL and would basically be giving up their livelihood for Dan. Not happening.

Pappy

Flasteel
09-19-2008, 08:22 PM
This deal was scuttled by the NFL at the behest of Dan Rooney. The good ol boy network didn't want an outsider owning and running the Steelers. There were enough NFL owners in Dan's corner to block the sale to Druckenmiller. It simply wasn't going to happen.

If I were Druckenmiller, I'd hire some attorneys and private investigators and look for collusion. MLB was able to prove it, I'm sure this one can't be that difficult to prove either.

Regardless, if the brothers allow Dan and Art to pay them off over time, it masy not be so bad; otherwise, this could put the Steelers in jeopardy from a cash flow position.

The best thing that could happen to the Steelers at this point would be for the brothers to sell their gambling interests and fade into the sunset. Of course, this isn't going to happen, because the gambling is a cash cow and steady flow of millions of dollars every year. Why give up future paychecks just to keep the Steelers in the Rooney family?

The brothers also have no interest (except, maybe Art) in having anythign to do with the NFL and would basically be giving up their livelihood for Dan. Not happening.

Pappy

This new development makes me believe that they very well divest themselves of the racing:

ROONEY BROTHERS REJECT OFFER FROM DAN, ART II
"Posted by Mike Florio on September 19, 2008, 4:25 p.m.
A day after the Rooney brothers not named Dan rejected the bid for 64 percent of the franchise from billionaire Stanley Druckenmiller (who then withdrew the bid), the Rooney brothers not named Dan apparently have rejected the bid from team chariman Dan Rooney and his son, Art II.

A statement from Dan and Art II, released by e-mail moments ago, states as follows:

“While we would have preferred our bid to have been accepted, we will continue our efforts to maintain the ownership of the Steelers in our family. We have been told on many occasions the other family members prefer to keep the franchise in the family. We look forward to ongoing dialogue within the family toward that goal. “We are grateful for the support we have received from many family members as well as those who have offered to become our partners. We hope that further discussions can remain cordial and private, and not become a distraction during the football season.”Hey, we also think that the team should remain in the Rooney family. But not in a manner that continues to represent conscious and deliberate disregard of league rules that presumably apply to the other 31 franchises.

The situation is pretty simple. The four Rooney brothers not named Dan have owned since 2006 gambling interests that violate league rules. If they want to keep control of the team in the family, they either must sell their gambling interests ASAFP, or they must come up with a mechanism for transferring their 64-percent piece of the team in a manner that gives Dan and Art II controlling interest.

Though it’s arguably in the league’s best interests to allow the Rooneys to have as much time as they need to work this out, the result has been a major bending of the rules that other franchises wouldn’t be wise to count on if/when they’re ever in the same situation."


It seems to me that all the other Rooney brothers can simply "sell" their interests in the race tracks to their own children. I admittedly know nothing about the laws or rules governing such a sale or even transfer of ownership, but it seems to me that if you can avoid a conflict of interest by selling to your brothers on one end, that you could do the same by passing along the other to your children or other relatives (if you plan on passing the team shares to your children).

Really, what other option is there?