Slightly ot: rehash of spirits of st. louis deal

[TruColor]

This has been talked about before, but it's getting brought up again.  This just blows my mind...

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The Spirit of St. Louis lives on forever -- greatest sports deal EVER

 

It is one of the greatest deals in sports history, one that brings its beneficiaries millions of dollars annually and requires them to expend no effort. There are no players to pay, no arena to lease, no schedule and no charter jet. That and this report from The New York Times' Richard Sandomir

The deal pays the owners of the St. Louis Spirits, a team that no longer exists, in perpetuity, because the National Basketball Association absorbed only four American Basketball Association franchises - the Nets, the San Antonio Spurs, the Indiana Pacers and the Denver Nuggets - in a merger after the 1975-76 season.

Under the arrangement, the four surviving A.B.A. teams pay the former owners of the Spirits a part of their television revenue each year. Two of those teams, the Nets and the Spurs, will face each other in the N.B.A. finals starting tomorrow night, the first time that two former A.B.A. teams will play for the surviving league's championship.

Donnie Walsh, the Pacers' president, spoke with amazement about the Spirits' good fortune. "The key word is perpetuity," he said by telephone from Indianapolis. "That's a long time. It's the greatest deal I've ever known."

The Spirits, who exist in memory (and on the remembertheaba.com Web site), were born as the Houston Mavericks in 1967, turned into the Carolina Cougars and finally moved to St. Louis in 1974, when the brothers Ozzie and Daniel Silna and Donald Schupak acquired them for $1.5 million. Moses Malone, Don Chaney, M. L. Carr and Marvin Barnes were among the stars of a freewheeling team that redefined free-spiritedness. Bob Costas was the rookie TV and radio announcer.

Rod Thorn, the Nets' president and general manager, was fired as the Spirits' head coach midway through the team's final season with a 20-27 record, replaced by Joe Mullaney. The Spirits would have been on their way to Utah the next season had the A.B.A. survived.

While the Kentucky Colonels and the Virginia Squires were as defunct as the Spirits, they did not have the foresight, or luck, of the St. Louis owners, who held out for future television-rights payments: one-seventh of the TV money that each of the four surviving teams receive annually.

"The thought was that if we didn't approve it, the Spirits would block the merger," said Bob Bass, the executive vice president of the New Orleans Hornets and a longtime former coach and executive with the Spurs in the A.B.A. and the N.B.A. "Nobody dreamed it would be that kind of money. It's a shame that there wasn't a limit or a high-water mark, when the payments would end."

Bass said the owners of the four teams merging with the N.B.A. "wanted to get the merger done, whatever they had to do." Because they feared that the Spirits might go to court to block the merger, Bass said, the owners approved the Spirits' cut of the TV deal.

"Perpetuity," Bass said, echoing Walsh, "is one long time."

In the late 1970's, when the Spirits first started receiving four-sevenths, or 57 percent, of a full TV share -one-seventh from each of the four teams - their booty was worth less than $500,000 a year.

Now, it is very real money. Under the current deals with ESPN, ABC and TNT, the Silnas and Schupak will receive an average of $15 million a year.

When those deals expire in 2008, the Silnas and Schupak, a Manhattan-based lawyer who negotiated the deal, will have collected about $190 million. Schupak did not return a call seeking comment.

That is a smidgen more than the $188 million that CBS Sports paid for four years of N.B.A. rights through 1990 and far more than the $120 million that ABC and ESPN are paying annually to televise the National Hockey League.

"The Silnas and Schupak made a very good deal," Russ Granik, the N.B.A.'s deputy commissioner, said. "Certainly, those four teams would prefer that they don't have to keep paying that one-seventh share. There have been efforts in the past 25 years to buy them out, but I don't know of anything that's current."

Bass said that about five or six years after the merger, the four former A.B.A. teams discussed a buyout of the Spirits' share - he recalled a sum of between $5 million and $6 million - but eventually the teams did not pursue the deal.

Walsh said the four teams tried again, in an effort that ended about six years ago. "It was a serious attempt," he said. "We offered them a lot. I thought they were taking it seriously. I think they were trying to plan their estates, but in the long run they didn't feel they needed to do it. But whenever you see one-seventh of your budget go out the window, we say, 'Should we talk to those guys again?' "

Walsh added: "Every five years, someone calls up with this story and it puts a dagger in my heart. I can laugh about it now, because I didn't do it."

[Puckguy14]

simply amazing.  those owners were pretty smart.  but let me ask you this.  wasn't it true that the then vancouver grizzlies were planning to move to st. louis?  and if that was the case, would that destroy the deal?

[Mac the Knife]

simply amazing. those owners were pretty smart. but let me ask you this. wasn't it true that the then vancouver grizzlies were planning to move to st. louis? and if that was the case, would that destroy the deal?

Yes, they were a candidate to move to STL, as they would've been sold to an owner based there, but...

No, it wouldn't destroy the deal, as they're totally unrelated.  The owners of the Spirits get their cut year in, year out, forever, no matter how many teams play in STL.

[yh]

I agree with Mad Mac.  The thing that is often overlooked, except for the article Pantone provided, is that the team wasn't even the Spririts of St. Louis at the time of the merger.  They had already committed to moving to Salt Lake City and in the book "Loose Balls" by Terry Pluto, it is even mentioned that after the final ABA season ended, the Spirits' front office people were answering the phone "Utah Spirits."  So, even if the merger would have been blocked and the ABA would have survived with 7 teams (San Antonio, Indiana, New York, Denver, Virginia, Kentucky and the Spirits), there still would have been no St. Louis team.

Another interesting ABA tidbit:  The San Antonio Spurs started out in Dallas (as the Chaparrals) and the New Jersey Nets (who were previously the New York Nets) actually started out as the New Jersey Americans.

[TruColor]

Correct about the St. Louis/Utah thing.  In fact, I believe the franchise had already chosen "Utah Rockies" as their new name.