OT: "the greatest sports business deal of all time" - UPD: Silnas bros/NBA settle

Discussion in 'Fugu's Business of Hockey Forum' started by ebox99, Nov 12, 2013.

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  1. ebox99

    ebox99 Registered User

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    http://espn.go.com/nba/story/_/id/9961147/sources-nba-tries-end-costly-aba-deal

    The Silna brothers are the former owners of an old ABA franchise known as the Spirits of St. Louis. When the ABA merged with the NBA in 1976, the Silnas agreed to dissolve their team in exchange for a small percentage of the NBA's future broadcast revenue.

    Since the deal was reached in 1976, the league has paid the Silnas $300 million in TV royalties. Recently, a judge ruled that the brothers also have rights to Internet revenue.
     
    Last edited by moderator kdb209: Jan 9, 2014
  2. Doan Jidion*

    Doan Jidion* Guest

    What's to settle? It's free money, and lots of it.
     
  3. kdb209

    kdb209 Registered User

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    Saw the thread title and thought - has to be Ozzie and Dan still laughing themselves to the bank - yup.

    A couple of pieces on the Silna TV deal.

     
  4. kdb209

    kdb209 Registered User

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    The only reason I could see the Silna bros settling - for a significant lump sum - would be estate planning. Ozzie Silna is 80 and Daniel is 69.

    The League's been trying to buy them out for 30+ years.
     
  5. OthmarAmmann

    OthmarAmmann Omnishambles

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    How would settling help their estate? I presume they're not the actual parties to the agreement but a corporate entity is instead. Even then, it's more difficult to value the entity if it has contractual right to future income than a sack of cash when they die.
     
  6. viper0220

    viper0220 Registered User

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    When Ozzie Silna and Daniel Silna, do the payments to them stop or do their children get it?
     
  7. viper0220

    viper0220 Registered User

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    I wish I had this kind of idea, does anyone want to join me? I am starting NAHA(catchy name), the North American Hockey Association to rival the NHL:sarcasm::naughty::D:laugh:
     
  8. Mungman

    Mungman It's you not me.

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    I'm assuming it's paid to a corporation, those entities don't die. The shares would be passed on by the shareholders estate upon their expiry.

    Sweet deal.
     
  9. ebox99

    ebox99 Registered User

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    NBA should just give them a free franchise in St. Louis now lol
     
  10. Riptide

    Riptide Registered User Sponsor

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    It would be interesting to know how much money they were talking about back in 76. I somehow suspect that it was peanuts - especially compared to now, and in the future.
     
  11. mouser

    mouser Business of Hockey

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    The Kentucky Colonels were the other final standing ABA team along with St Louis that didn't go to the NBA. Owned by John Y Brown Jr
    http://en.wikipedia.org/wiki/John_Y._Brown,_Jr.


    http://www.remembertheaba.com/TeamMaterial/KentuckyMaterial/ColonelsYearly.html
    So $3m to fold the team. And another $1.655m from the player dispersal draft.
     
  12. Tom ServoMST3K

    Tom ServoMST3K Hockey Professor in Training

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    just saw the 30 for 30 on this

    Surprised at how accurate Semi-Pro was :laugh:
     
  13. Sens Rule

    Sens Rule Registered User

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    Kinda like this long term terrible deal for Hydroelectric power from Churchill Falls in Labrador: (from Wikipedia)

    he division of profits from the sale of electricity generated at the plant has proven to be a very sensitive political issue in Newfoundland and Labrador, with many considering the share accorded to Hydro-Québec "an immense and unconscionable windfall."[12]
    The Government of Newfoundland and Labrador has twice challenged the contract in court, with both challenges failing.[13] Additionally, in 1984 the Supreme Court of Canada ruled that a proposal by Newfoundland to divert water away from the falls was illegal.[11]
    According to former Premier Brian Tobin, as Labrador only borders Québec, when an agreement was being negotiated to sell the power generated at Churchill Falls, the power either had to be sold to an entity within Québec or it had to pass through Québec. The government of Québec refused to allow power to be transferred through Québec and would only accept a contract in which the power was sold to Québec.[14] Because of this monopsony situation, Hydro-Québec received very favourable terms on the power sale contract. The contract was negotiated to run for a 65-year timespan, running until the year 2041, and according to former Newfoundland Premier Danny Williams, Hydro-Québec reaps profits from the Upper Churchill contract of approximately $1.7 billion per year, while Newfoundland and Labrador receives $63 million a year.[15]
     
  14. madhi19

    madhi19 Just the tip!

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    Yeah there no way in hell if am in these guys shoes that I settle anything.
     
  15. madhi19

    madhi19 Just the tip!

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    Too effing bad you sign the damn contract you live with it. Newfoundland could have just bought it juices from Quebec, not build the dam and made a way better deal.
     
  16. cutchemist42

    cutchemist42 Registered User

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  17. Hasbro

    Hasbro Can He Skate?! Sponsor

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    Loose Balls by Terry Pluto is a history of the ABA and a hilarious read. The fact that such a **** show like the Spirits turned into such a goldmine is indicative of the humor provided by the league.

    OT: but the Colonels were actually a viable franchise and probably in better shape than some NBA teams. However the Bulls wanted Artis Gilmore off their squad.
     
  18. tarheelhockey

    tarheelhockey Highest Boss

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    Interesting point made in the reader comments:

    Q: Why would the Silnas ever take a buyout? They're guaranteed to make tens of millions per year in 'free' cash payments.

    A: The Silnas only have the rights to broadcast income. That excludes online streams, Netflix, etc. They have just filed a lawsuit to expand the definition of 'broadcast' to include new media, and this buyout offer was the NBA's response. If the Silnas lose that lawsuit and sports viewing continues to move into new-media territory, they could be out of luck in the long term. The $500M up front is more enticing even if invested very conservatively.
     
  19. Jtown

    Jtown Registered User

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    i'm surprised they got bought out. That contract would go on forever, doesn't make much sense.
     
  20. kaiser matias

    kaiser matias Registered User

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    Worth noting:

     
  21. Stonewall

    Stonewall Registered User

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    Similar to what Alec Guinness (Obi Wan Kenobi) did.

    http://en.wikipedia.org/wiki/Alec_Guinness

    "He was one of the few cast members who believed that the film would be a box office hit; he negotiated a deal for 2% of the gross royalties paid to the director, George Lucas, who received one fifth of the box office takings."
     
  22. No Fun Shogun

    No Fun Shogun 34-38-61-10-13-15

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    Well, both of the brothers are getting on in years and they might be at the point where they figure that dividing a lump sum amongst their heirs would be less hassle than divvying up the deal they have with the NBA (not to mention that there might be some legal loopholes when it comes to changing payees and division of payments that they think the NBA could have some leverage on), even when you figure that estate taxes will take a chunk out of that.
     
    Last edited: Jan 7, 2014
  23. kdb209

    kdb209 Registered User

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  24. jumptheshark

    jumptheshark Rebooting myself Sponsor

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    without taking this sideways-- Guiness got two % Gross because Lucas could not afford to pay Guinnesses usual rate and Guinness (according the legend here in the UK) got nagged by Sir John Guilgud who told Guinness he was taking himself to seriously and because of where they were shooting he should treat it like a vacation. Guinness had little faith in the movie and after reading the original draft convinced Lucas to kill Obi one off.
     
  25. rj

    rj Registered User

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    a couple Indy-area broadcasters lamented that movie (Pacers were originally ABA), saying there were so many better stories from the league the movie could've lampooned
     

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