RSS Facebook Twitter LinkedIn
 


Featured Advisor



Kim Butler
President

Partners for Prosperity, Inc.

City:Mt. Enterprise

State: TX



BIOGRAPHY:
I have 20+ years of handling alternative investments in cash, growth and income for clients nationwide.  I strive to help my clients with all things financial in every way possible over the phone and the web.  I own an alpaca farm which I enjoy working during my downtime.  I also enjoy gardening, writing and reading books.  I also train other advisors on Prosperity Economics.

Click to see the full profile


Share |

Kent's Sports Blog: The Greatest Deal Ever

 Ozzie Silna, who negotiated the greatest deal in sports history, died last month. 

| BY Kent McDill

In late April, one of the great professional sports businessmen in American history passed away. You may not have heard about his passing. You may not have known who he was if you did hear.

His name was Ozzie Silna. He died at the age of 83 after a battle with cancer.

This is his story.

Ozzie and his brother Dan Silna were the owners of the Spirits of St. Louis, a franchise that played only two seasons in the American Basketball Association. The ABA was a sport league created to compete with the National Basketball Association and was in existence from 1967 until 1976, when it merged with the NBA.

Only four teams from the ABA entered the NBA at that time, and sports fans consider that to be one of the best sports trivia questions ever. For your future needs, those four teams were the San Antonio Spurs, the New York Nets (who are now the Brooklyn Nets), the Indiana Pacers and the Denver Nuggets.

There were two other ABA teams at the time of the merger. They were the Kentucky Colonels and the Spirits of St. Louis. The Virginia Squires had disbanded one month before the merger.

The Silnas stood in the way of the merger, but finally agreed to dissolve their team and organization in exchange for a one-time payment of $2.2 million (coming from the four ABA teams absorbed into the NBA) and one-seventh of the television broadcast revenues of the four former ABA teams in perpetuity. (The owner of the Kentucky Colonels instead took a $3.3 million payoff from the four ABA teams absorbed into the NBA).

The Silnas thus were in line to receive approximately 2 percent of all future NBA broadcast revenues. In 1976, that was an insignificant amount of money. But the NBA has exploded since Magic Johnson, Larry Bird and Michael Jordan entered the league, and the league’s broadcast revenues have exploded as well.

The Silnas were hoping the NBA would want to renegotiate the deal someday and give them the opportunity to won an NBA franchise. That did not happen, but the deal worked out for them financially anyway.

Their first payment from the league was for just over half a million dollars. But in the 1980s, the broadcast revenues of the league jumped considerably. Through the 1990s, the Silnas were receiving more than $4 million per year from the league. In 2000, that amount increased to $12 million, then increased again to $15 million per year, to more than $17 million by 2010. That money was coming out of the broadcast revenues to the four former ABA teams, the league tried on numerous occasions to negotiate a final deal of some sort with the Silnas.

It was estimated the Silnas received $300 million between 1976 and 2014 from the NBA for its deal, even though the team that generated that money did not play a game. The Silnas actually sued the NBA for more money, claiming that revenues from new broadcast venues such as internet and streaming services were not included in their payments.

In 2014, the NBA and the Silnas reached a conditional agreement that was to provide the Silnas with $500 million to kill the previously negotiated deal. It was worth it to the NBA to give the brothers half a billion dollars, which is an indication of just how profitable the broadcast rights to the league have become.

The Silnas deal is considered to be one of the greatest deals ever struck in professional sports history. The Silnas never got back into professional basketball team ownership, and St. Louis has not had a professional basketball team since the St. Louis Hawks moved to Atlanta in 1968, but the city’s sports history is not complete without an appreciation of the Spirits of St. Louis.



About the Author


Kent McDill

kmcdill@spectrem.com

Kent McDill is a staff writer for Millionaire Corner. McDill spent 30 years as a sports writer, working for United Press International and the Daily Herald of Arlington Heights, Ill. From 1988-1999, he covered the Chicago Bulls for the Daily Herald, traveling with them every day through the nine-month season. He also covered the Bulls for UPI from 1985-88, and currently covers the team for www.nba.com. He has written two books on the Bulls, including the new title “100 Things Bulls Fans Should Know And Do Before They Die’, published by Triumph Books. In August 2013, his new book “100 Things Bears Fans Should Know And Do Before They Die” gets published.

In 2008, he resigned from the Herald and became a freelance writer. The Herald hired him to write business features and speeches for the Daily Herald Business Conferences and Awards presentations.

McDill also writes a monthly parenting column for the Herald’s Suburban Parent magazine.

McDill is the father of four children, and an active fan of soccer, Jimmy  Buffett and all things Disney.