Saturday, November 15, 2008
By Gerry Dulac and Ed Bouchette, Pittsburgh Post-Gazette
http://www.post-gazette.com
Gene J. Puskar/Associated Press
Steelers President Art Rooney II, left, and his father, Chairman Dan Rooney, right, shown celebrating with quarterback Ben Roethlisberger during their last Super Bowl run, may soon have controlling interest in the franchise.
The four Rooney brothers who are seeking to sell their shares in the Steelers franchise have agreed on a sale price of $800 million with team chairman and oldest brother Dan Rooney, but some minor issues still need to be resolved and the deal has not been completed.
The Pittsburgh Post-Gazette has learned that both sides have agreed on a franchise value of $800 million, a price that would then determine the amount for each share of stock. It is not known if the four brothers intend to sell a portion or all of their 64 percent shares to Dan Rooney and his son, Art II, the team president.
Each brother would receive about $128 million if he sold his entire 16 percent share, a total that is expected to be paid over a number of years. However, some of the brothers may retain a small percentage of ownership and would not sell all their shares to Dan Rooney, lowering the amount they would receive.
Neither Dan Rooney nor Art II has been informed that the deal has been finalized.
The Post-Gazette reported Tuesday that the four brothers had decided to sell their shares to Dan Rooney -- the only suitor remaining -- and were working on details of the agreement.
The brothers were trying to expedite the sale process and hoped to have approval from the National Football League by the end of the year. But to do so, they would have to present an agreement to the league's finance committee, which would consider the agreement and then send it to the league owners meeting, scheduled for Dec. 17 in Dallas, for approval.
In an e-mail to the Post-Gazette, Tim Rooney, one of the brothers seeking to sell his share, said: "There are more than a few loose ends to be solved but are or should be doable. It is very important to solve the problem before the end of the year because of taxes."
It appears that process is getting closer to realization.
Art Rooney Jr. said NFL Commissioner Roger Goodell is in the process of calling each Rooney brother to give a "pep talk" and encourage them that a deal will be finalized.
From all indications, the deal with Dan Rooney will be for less money than the deal that was being offered several months ago by New York hedge-fund billionaire Stanley Druckenmiller, who sought majority stock control and offered to buy all 64 percent shares in the franchise for $537 million. Mr. Druckenmiller's enterprise value of the franchise was $840 million, a figure that included stocks, not assets.
Dan Rooney's offer to buy the shares from his brothers was lower than the one offered by Mr. Druckenmiller. At one point, when his brothers asked him if he would increase his offer to match Mr. Druckenmiller, Dan Rooney declined.
When the four brothers rejected his bid, Mr. Druckenmiller withdrew his offer and no other suitors emerged -- not surprising given the instability of the economy and the financial collapses on Wall Street. The only offer remaining to be considered was from Dan Rooney.
Dan Rooney and his son have not yet identified any potential investors who would help purchase the shares from the Rooney brothers.
Because of that, it is unclear how much Dan Rooney would have to finance through PNC Bank, one of the banks retained to handle the purchase.
Gerry Dulac can be reached at gdulac@post-gazette.com or 412-263-1466.
Ed Bouchette can be reached at ebouchette@post-gazette.com.
First published on November 15, 2008 at 2:49 am
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