June 20, 2023

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Good morning, this is Eric Fisher [[link removed]], newsletter co-author. The weekend ended with high drama as former journeyman Wyndham Clark held off four-time major winner Rory McIlroy by one stroke to win the U.S. Open. And now the week is underway with more drama as DraftKings received a further lift in its upstart bid to buy the PointsBet U.S. assets thought to be headed to Fanatics.

Las Vegas NBA-Ready Arena Project Grows to $10B [[link removed]]

Matt Cashore-USA TODAY Sports

With NBA expansion on the cards later this decade, the group vying to build a suitable basketball arena in Las Vegas is significantly increasing its investment.

Oak View Group CEO Tim Leiweke said that his company is now budgeting $10 billion for a potential hotel, gaming, and entertainment district after initially laying out $3 billion [[link removed]].

No public money would be required at the outset. “It helps when you walk into a room and say to them, ‘I do not need your money,’” Leiweke said [[link removed]].

The project’s footprint is also growing from 35 acres to 66.

An NBA team in Las Vegas seems to be a near-certainty according [[link removed]] to league commissioner Adam Silver, even if the timeline, where the team would play, and who would own it remains to be determined.

OVG led the $1.15 billion rebuild of Climate Pledge Arena in Seattle, which is also seen as a frontrunner for a future NBA expansion team. The SuperSonics played in Seattle from 1967–2008 — winning an NBA title in 1979 — before moving to Oklahoma City in 2008.

LeBron James hasn’t been shy about his desire [[link removed]] to be involved in an ownership group of an NBA team in Las Vegas. James has a stake in Fenway Sports Group — the owners of the Boston Red Sox, Pittsburgh Penguins, and Liverpool of the Premier League — which could front the bulk of the expansion fee.

Leiweke is bullish on Las Vegas’ ability to handle another major venue on top of T-Mobile Arena, home of the NHL champion [[link removed]] Vegas Golden Knights.

Vegas is the “No. 1 live entertainment market” in the world, Leieweke said.

PODCAST

🎙️ They Said What?

“Do we think eliminating racism is to some degree aspirational? Absolutely … But I would like to think that in two or three generations, we could have this world where racism, the way that we experience it, is eliminated.”

— Diahann Billings-Burford, CEO of Rise, on her organization’s mission to eliminate racism by educating and empowering the sports community. Check out the latest episode of Front Office Sports Today to hear more from Billings-Burford on how she believes sports can build bridges when discussing race and racism.

🎧 Listen and subscribe on Apple [[link removed]], Google [[link removed]], and Spotify [[link removed]].

Rays Owner Adamant About Not Selling Team Despite Buyer Interest [[link removed]]

Kim Klement-USA TODAY Sports

Stu Sternberg has been publicly clear in his intent to remain the Tampa Bay Rays’ majority owner. But that hasn’t stopped offers heading his way for the MLB team.

Just weeks after Tampa businessman Dan Doyle Jr. offered [[link removed]] unsolicited interest in acquiring the Rays, Forbes reports [[link removed]] that Doyle is working with Trip Miller, founder of Tennessee-based hedge fund Gullane Capital, to mount a bid for the club.

The report said Miller and Doyle are preparing a $1.85 billion offer for the club, which would represent a 48% premium on Forbes’ estimated value earlier this year. Sternberg shot down the prior sale chatter and said, “I expect we will build a ballpark in Tampa that will keep the Rays here for generations to come. I also plan on remaining the Rays owner.”

Now, the latest salvo is being greeted with a sense of bewilderment. When asked by Front Office Sports about the reported Miller interest, a senior-level Rays source said, “I hadn’t seen it until you emailed.”

The Rays have been locked in a years-long struggle to develop a new facility to succeed the outdated Tropicana Field in St. Petersburg, Florida.

As the layers of franchise turmoil continue, the team on the field remains MLB’s best. And while the Rays are still lagging behind in MLB attendance — ranking 27th in the league with a per-game average of 17,187 — the team’s 24% boost compared year-over-year is part of a larger surge [[link removed]] for the league at the gate.

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MLB Hopes Coyotes Rejection Won’t Affect Future Diamondbacks Plans [[link removed]]

Joe Camporeale-USA TODAY Sports

Major League Baseball remains hopeful that the Arizona Diamondbacks won’t face a similar venue dilemma as the neighboring Arizona Coyotes.

After Tempe, Arizona, voters firmly rejected [[link removed]] a Coyotes arena proposal last month — leaving the NHL and team scrambling [[link removed]] for next steps — the Diamondbacks increasingly have their own facility issues. The lease on the aging, publicly owned Chase Field expires after the 2027 season, and team officials must decide [[link removed]] whether to build a new venue.

MLB commissioner Rob Manfred said he doesn’t believe the Tempe vote speaks to a larger sentiment.

“Whenever you get near the end of a lease, you get yourself into a situation where what I regard to be public assets … need updating,” Manfred said following MLB owners meetings in New York. “I’m hopeful that whatever went on with the Coyotes is not an indication of a lack of support to fulfill the public part of the partnership to keep the Arizona facility a first-class, major league facility.”

Oakland Pushback

Nevada Gov. Joe Lombardo signed legislation authorizing $380 million in public funds for a $1.5 billion ballpark in Las Vegas for the Oakland A’s, pushing the team ever closer [[link removed]] to a relocation.

After Manfred said, “What is it that Oakland was prepared to do? There is no Oakland [stadium] offer,” mayor Sheng Thao blasted back at the commissioner.

“This is just totally false. There was a very concrete proposal under discussion, and Oakland had gone above and beyond to clear hurdles,” Thao said through a spokesperson.

PointsBet To Begin Negotiations With DraftKings Over Bid For U.S. Assets [[link removed]]

Alex Gould/The Republic

DraftKings’ surprise $195 million bid [[link removed]] to acquire PointsBet’s U.S. business received a significant boost Monday as PointsBet’s board of directors said the offer “could reasonably be expected to lead to a superior proposal.”

Three days after DraftKings made the bid — in the process looking to outflank a rival, $150 million buyout offer [[link removed]] from Fanatics — PointsBet said its initial review [[link removed]] found that the DraftKings proposal warrants additional investigation.

“The board is prepared to engage with DraftKings,” wrote Brett Paton, PointsBet’s non-executive chairman, in a letter to DraftKings chairman and CEO Jason Robins.

Paton’s letter also detailed specific protocols for due diligence since PointsBet currently competes with DraftKings, as well as PointsBet’s intent to have DraftKings pursue a “hell or high water” standard in seeking antitrust and other regulatory approvals.

Since DraftKings’ offer is currently non-binding, Paton said the PointsBet board “continues to recommend that PointsBet shareholders vote in favor of the [Fanatics] transaction.” But PointsBet is also requesting DraftKings send formal deal documents by June 27, a move that could further shift board sentiment toward DraftKings.

The Australia-based PointsBet previously scheduled a June 30 vote on the Fanatics deal, and the deadline made to DraftKings precedes that vote.

DraftKings’ move represents [[link removed]] a rare speed bump for Fanatics, which has mushroomed beyond its sports merchandising origins into trading cards [[link removed]], international sales, collectibles [[link removed]] auctions, content [[link removed]], and sports betting [[link removed]] — all while building its company value to a stratospheric $31 billion.

Conversation Starters Michael Jordan’s career earnings [[link removed]] now include: $93.8 million as an NBA player, about $2 billion from Nike, and now another $2 billion from selling the Charlotte Hornets. Sweden has emerged as the frontrunner [[link removed]] to host the 2030 Winter Olympics in Stockholm. It would be the Scandinavian country’s first time hosting the Olympics since the 1912 Summer Games. San Diego State has notified [[link removed]] the Mountain West conference that the school “intends to resign” from the conference,” per ESPN. SDSU is “exploring all options” — and hasn’t received a formal invitation from any Power 5 conference. LEARNING

Let’s hear from you! What topics should our next Front Office Sports Learning courses cover? Let us know. [[link removed]]

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The Role of CTV in Sports Franchise Valuations

Live sports programming has always dominated primetime ratings on linear television, but streaming content has become extremely popular [[link removed]] with younger generations of sports fans, particularly among millennials and Gen Z viewers.

The surge in demand for streaming TV and short-form content has disrupted the traditional TV media rights model and significantly boosted the valuation of sports franchises. With streaming television’s influence on ever-expanding media rights, franchises across all sports are being purchased at a premium due to their promising growth potential [[link removed]].

Leagues, franchises, and sports that can be innovative and agile enough to stay aligned with the shifting mediums of engagement will have the advantage for capturing the next generations of valuable fans.

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Editor's Picks From the Champs to the Draft, the World Has Taken Over the NBA [[link removed]]by Doug Greenberg [[link removed]]

Embiid, Jokic, and Wembanyama are leading a global revolution in the NBA.

How Francis Ngannou and PFL Could Revolutionize Fighters’ Pay [[link removed]]by A.J. Perez [[link removed]]

His PFL move could shift MMA's power structure and change fighter pay.

LIV Golf, PGA Tour Seek Dismissal of Federal Antitrust Case [[link removed]]by A.J. Perez [[link removed]]

Filing means likely end of the legal feud between LIV Golf and PGA Tour.

Question Of The Day

How often do you stream sports on your phone?

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