Colangelo exploring sale of the Phoenix Suns
By Mike Tulumello, Tribune
March 8, 2004
Jerry Colangelo, the major force in building the Valley of the Sun into a big-league sports town, is exploring the sale of the Suns, Colangelo said Monday.
Ideally, Colangelo wants to find a buyer who will agree to be a minority partner for several years, "learn the business" from him and then agree to purchase the club. Under these circumstances, Colangelo, now the club's chairman, would remain in charge for several more years.
Colangelo indicated he thinks the Suns are worth more than the $300 million recently paid to purchase the New Jersey Nets. At the same time, Colangelo said the sale price isn't the only factor, that he wants to find a buyer who shares his "passion" for charity work and community involvement.
Colangelo indicated he owns about 18 percent of the club, while his partnership group owns about 36 percent. Another major partner is El Dorado Investment Co., a subsidiary of Pinnacle West, which he said owns. 21.7 percent of the club.
The team's original owners from the expansion days of 1968 — Richard Bloch, Donald Pitt and Don Diamond — own 13 percent. Other investors own small shares, he said.
As the club's general partner, however, he said, "This is my call all the way," and that the process would involve the purchase of the entire club.
Colangelo, 64, had talked a few years ago about finding an investor who would purchase some of his own share of the club. But he had downplayed this subject in recent years.
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When the Suns made a surprising mid-season trade that got rid of Stephon Marbury and Penny Hardaway — who had long-term contractual obligations of about $150 million — one Suns official indicated the deal was made in part so that Colangelo could avoid bringing in a partner.
Colangelo said Monday that the Marbury trade was unrelated to the current events.
The current process, in which the Suns have hired Lehman Brothers Holdings Inc. to search for potential buyers, is intended to lead to a sale, not about finding another minority partner, Colangelo said.
"If somebody is interested in purchasing half of the Suns with an option to buy the other half, that would be something I'd be interested in doing," he said.
"With the right equity partner, I would be interested in doing a deal with the Suns to begin a transition that would be a total sale down the road."
Along the way, Colangelo indicated he'd like to remain the Suns' chairman.
Noting the Suns have been well regarded in the sports world over the years, he said, "It would behoove someone coming in to learn the business for a while, wouldn't it?"
While saying, "I think we're worth more" than the Nets' $300 million purchase price, Colangelo said, "This is not just about money."
It's also about "legacy and putting the right people in place," he said.
In searching for a buyer, Colangelo said he is looking for "people who share the same passion for the community" and who will continue the Suns' tradition of being donors to charitable causes.
The Suns "will be in the black" this season, after a series of moves cut the team's payroll from about $66 million to less than $55 million, Colangelo said. A Suns official indicated a year ago that the club lost about $5 million last season.
Colangelo told Bloomberg News Service that he would like to be involved as long as he can with the Suns. He added, "But I'm realistic. My partner may not want to wait that long."
Colangelo said he hasn't had any discussions with Michael Jordan, the five-time NBA most valuable, who is seeking majority control of an NBA team.
Colangelo, a basketball star in college at Illinois, started out in sports with the Chicago Bulls. He took over as general manager of the expansion Suns in 1968 at age 28. He led the investment group that bought the Suns for $44.5 million in 1987.
Colangelo also was the key figure who put together baseball's Arizona Diamondbacks.
He indicated his son Bryan would remain as the Suns' president. "I'm not worried about Bryan," he said. "Bryan can take care of himself. He's well regarded in the industry."
Colangelo said he hired Lehman Brothers a couple of months ago and is in no hurry to sell the club.
"If nothing happens, that's fine with me, too."
