Do you think they are going to sell the Braves, or are they privately owned by Turner?
Hawks-Thrashers deal worth $350 million to $400 million
By TIM TUCKER
Atlanta Journal-Constitution Staff Writer
AOL Time Warner's deal with Texas businessman David McDavid for the sale of the Hawks, Thrashers and the Philips Arena operating rights is valued at $350 million to $400 million, people familiar with the agreement told the Journal-Constitution Friday.
That figure, they said, includes the cash that McDavid will pay when the deal closes, the debt he will assume on Philips Arena and all other considerations on both sides.
A final value of the deal will fluctuate within that range, partly depending on items still to be negotiated between the parties, who expect to complete the transaction within two months.
The value of each individual part of the deal is not clear.
If the Philips Arena operating rights were valued at $140 million -- the amount of the bonds used to build it -- that would put the value of the two teams in the $210 million to $260 million range. However, McDavid might not be responsible for all of AOL's arena debt.
Also, the deal was negotiated as a package so it could be difficult to assign an accurate value to each part, the people familiar with the arrangement said.
In any case, it is clear that the Hawks and Thrashers, as expected, went for significantly less than the widely quoted $340 million that Forbes magazine estimated them to be worth. Forbes had the Hawks' value at $206 million and the Thrashers at $134 million.
Analysts did not expect the teams to fetch anywhere near those amounts because of the glutted market for sports franchises nationally and other recent sales prices. Baseball's Anaheim Angels sold for $180 million, down from an asking price of $300 million. In hockey, the Buffalo Sabres sold for a reported $70 million-plus, and the Ottawa Senators and their arena went for $150 million.
AOL officials and McDavid have refused to comment on the value of their deal.
McDavid said Thursday that he agrees he was in a "buyer's market." But asked if he got the teams on the cheap, he answered: "I wouldn't say they were a bargain."
McDavid and AOL signed a letter of intent on the deal Wednesday.
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