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The Honolulu Advertiser
Posted on: Tuesday, March 23, 2010

NFL: Part owner of the Rams isn’t ready to say what he will do with his stake

By Jim Thomas
St. Louis Post-Dispatch

ORLANDO, Fla. — The day’s business concluded, Stan Kroenke walked out of the NFL owners’ meeting room Monday evening with Rams senior consultant John Shaw at his side.

About the last person Kroenke wanted to see in this venue was a reporter. He has always been what’s best described as media shy — and that’s particularly the case now that Urbana, Ill., businessman Shahid Khan has entered into an agreement to purchase controlling interest in the Rams.
So what will Stan do? Buy, sell or stand pat? Kroenke didn’t tip his hand Monday, saying he continues to consider his options.
“We’re all talking about our different approaches here, trying to come up with the best approach for everyone involved, I think,” Kroenke said.
He also indicated that he will take the full 60 days, or very close to it, to decide what to do.
“I think that it’s prudent to think through your options,” Kroenke said. “These are big decisions. We’re going to try to do the right thing.”
Kroenke said he really couldn’t say anything more until the process plays itself out.
Kroenke currently owns 40 percent of the Rams. He can decide to:
—Stand pat and maintain his 40 percent share of the Rams.
—”Cash out” and sell his 40 percent share.
—Exercise his right of first refusal, in essence matching Khan’s offer for the team.
In reality, Kroenke probably has only two options: maintain his 40 percent share or sell it. Because in pretty strong language Monday, NFL Commissioner Roger Goodell indicated that the league wasn’t inclined to bend its cross-ownership rules to allow Kroenke to match Khan’s offer.
“Let’s cross that bridge when we get to it,” Goodell said. “But I don’t think so. I think everyone understands we’re going to respect our policies and make sure we treat everyone the same.
“We have great respect for Stan, and he has to make some choices. But he also understands the league wants to continue to have policies that we think are beneficial to the league in general and fair to all 32 clubs.”
The cross-ownership rule prevents owning a controlling share in an NFL team in one market while owning majority interest in another major-league team (baseball, basketball, hockey) in a competing NFL city.
Kroenke owns the Denver Nuggets of the National Basketball Association and the Colorado Avalanche of the National Hockey League.
As part of Khan’s Rams sale agreement Feb. 12, Kroenke has 60 days to declare his intentions with respect to Rams ownership. April 12 is three weeks away, so the time for making a decision is drawing near.
The “vetting” of Khan and the entire sales process can go only so far until Kroenke declares his intention.
“Probably the big question is what is Stan Kroenke going to do?” Atlanta Falcons owner Arthur Blank said. “And I don’t know the answer to that.”
Blank is one of nine owners who make up the NFL’s finance committee. The finance committee will consider Khan’s bid to purchase the Rams and ultimately make a recommendation to the full league membership.
The St. Louis Post-Dispatch interviewed six of the nine finance committee members Monday. In so many words, Philadelphia’s Jeffrey Lurie, Tampa Bay’s Joel Glazer and Jacksonville’s Wayne Weaver declined to comment, in part noting that much work remains to be done in the process.
While also noting that the process is not yet complete, two finance committee members spoke favorably of Khan and his chances to gain approval.
“I look forward to meeting him,” Blank said. “I know from what I read, he sounds like a wonderful gentleman. ... From what I know, I certainly don’t see any problems.”
As is the case with Blank, Indianapolis Colts owner Jim Irsay has not yet met Khan.
(Khan must meet with the finance committee before the committee gives its recommendation and is expected to do so after Kroenke’s declaration.)
“I think indications are that (Khan’s) strength of wealth is there,” Irsay said. “His background and those sort of things are really positive. It’s not something that we’ve got our final reports on, but all indications are that it’s trending in a positive direction for him.”
But it’s not as if Khan will get a free pass. According to one league source attending these owners meetings in Orlando, there will be questions about his current dispute with the Internal Revenue Service. The IRS disallowed some tax shelters utilized by Khan and asked him to pay $68 million in additional taxes. Khan paid the taxes but has appealed the IRS decision.
The league source, speaking on the condition of anonymity, indicated that the IRS issue probably would be a “ripple” in the approval process, but not any kind of full-blown controversy.
As reported in Sunday’s Post-Dispatch, Kroenke has spent some time recently getting to know Khan, who immigrated to the United States from Pakistan at age 16 and rose to billionaire status in the auto parts industry.
“In many ways, he’s the classic American success story,” Kroenke said. “How do you not respect that, and what he’s done?”
As for his time spent with Khan, Kroenke said, “He looks like a very capable guy, and he’s certainly a likable guy.”
So does Kroenke think he could work with Khan as Rams owners?
“He seems like a nice fellow, a very nice fellow,” was Kroenke’s answer.