It’s going to be fine.

From the Wall Street Journal:

The Pittsburgh Steelers — owned for 75 years by the same local family — is secretly being shopped to potential buyers as the five sons of the football team’s founder and their heirs spar over the storied franchise’s future.

The statement said that Mr. Rooney and his son, Steelers President Art Rooney II, are arranging a financing plan to buy the brothers’ shares in the team in order to continue substantial ownership of the franchise by the Rooneys.

“I will do everything possible to work out a solution to ensure my father’s legacy of keeping the Steelers in the Rooney family and in Pittsburgh for at least another 75 years,” Dan Rooney said in the statement.

But some of his brothers and younger third-generation family members have sought an independent analysis by a top Wall Street investment bank to see whether a better deal can be put together. They worry that Dan Rooney’s plan undervalues the team and takes on too much debt.

Readers are writing me all, “Nooooooooooooooooooooooooooo!”

Let’s stay calm and let this work itself to where it’s going to go.

I’m not flinging myself off of any bridges yet.

Not unless they sell the team to some Mexicans like those infidel Kennywood owners did.

(I’m. just. kidding.  Don’t write me, yo.)





14 Comments

  1. Bill from Hanover
    July 8, 2008 9:29 am

    No need to get your panties all bunched up here folks, the Rooneys are not going anywhere and they are very talented business people !

    Here’s the article from the Post Gazette that explains it rather well …..

    The Rooney family is working to restructure the ownership of the Steelers to comply with National Football League guidelines that prohibit association with racetrack and gambling interests, a process that is forcing several brothers of team chairman Dan Rooney to seek to sell their shares in the franchise, according to a source familiar with the situation.

    The move in all likelihood will not affect the current management structure of the Steelers. But, according to the source, it is possible that two or three of the five Rooney brothers, could sell their equal share in the team to Dan Rooney and his son, Art II, the team’s president, or to outside investors — a possibility that has created discord in the family ownership structure.

    ——————————————————————————–

    Chart
    PDF: Art Rooney’s legacy to his five sons
    ——————————————————————————–
    Amid suggestions that there are intergenerational tensions among the family members, another source close to the team said that the family remains close but that future issues such as inheritance taxes caused concern for some.

    The Post-Gazette has confirmed that Stanley Druckenmiller, a billionaire and chairman of Pittsburgh’s Duquesne Capital Management, has emerged as a potential buyer. That interest came after Dan Rooney presented a buyout proposal that some family members thought undervalued the team; they sought another analysis from Wall Street investment bank Goldman Sachs & Co. that valued the team at $800 million to $1.2 billion, the Wall Street Journal reported, citing documents reviewed by the paper for what it called a secret project code-named “Project Newcastle.”

    Members of the Rooney family could not be reached for comment on the newspaper’s report.

    In a statement released earlier yesterday by the team, the Steelers said Dan Rooney, along with his son, are trying to arrange financing to buy his brothers’ shares in the team in an attempt to gain majority ownership of the franchise. According to the source, several of the brothers are seeking to sell their shares of the team — either to Dan Rooney or outside investors — and will no longer be involved in ownership of the Steelers.

    According to the source, the brothers in question are Timothy, Patrick and John Rooney, who are involved with the operation of Empire City at Yonkers Raceway, a harness racing track in Yonkers, N.Y., and the Palm Beach Kennel Club in West Palm Beach, Fla.

    The five Rooney brothers — Dan, Art Jr., Timothy, Patrick and John, all sons of the late founder Art Rooney Sr. — combine to own 80 percent of the team, with each owning an equal share, or 16 percent. The family of John McGinley Sr., who died in October 2006, and his sister, Rita, own the other 20 percent.

    Since the Yonkers track added video slot machines in 2006, the Steelers have been attempting to restructure their ownership in order to comply with NFL policy that prohibits involvement with racetrack and gambling interests. As part of that arrangement, the Steelers have been working with former NFL commissioner Paul Tagliabue, an attorney, to remedy the situation.

    However, according to the source, the league has not pressured the Rooney family to restructure their ownership and has not given them a timetable in which to divest their gaming interest.

    Dan Rooney, the oldest son of the team founder, said in a statement he will “do everything possible to work out a solution to ensure my father’s legacy of keeping the Steelers in the Rooney family and in Pittsburgh for at least another 75 years.”

    Rooney said he wants to stay in the football business while some of his brothers plan to focus on the racetracks in New York and Florida and other interests.

    The family that has long been associated with the gambling industry, starting with Art Rooney Sr.’s purchase of the team in 1933 with the winnings from a successful weekend of betting on horse racing, now finds itself at a crossroads over the same issue.

    Patrick Rooney runs the Palm Beach Kennel Club and Timothy is president of the Empire City at Yonkers Raceway.

    Art Rooney Sr., who loved gambling, purchased the Steelers for $2,500 in 1933. In 1936, he gained national fame after winning what was variously reported as between $108,000 and $256,000 at two New York ractetracks. He purchased the Florida dog track in 1970 and the Yonkers horse track in 1971.

    Both Dan and Patrick Rooney told the Post-Gazette in 2002 that the racing interests had been more profitable than the team for several years.

    The other 20 percent of the team has been owned since the 1940s by the McGinley family of Pittsburgh. Their share was acquired from the late Bert Bell, who briefly controlled ownership of the team. When Mr. Bell became the NFL commissioner, he sold the majority interest back to Art Rooney Sr. and 42 percent to Barney McGinley.

    Barney McGinley’s four children each inherited about 10 percent of the team. When two of the siblings died, the Rooneys bought their shares and the others passed to Jack McGinley and his sister Rita. Jack, who died in 2006, was married to the sister of Art Rooney Sr.

    Gerry Dulac can be reached at gdulac@post-gazette.com.



  2. Bill from Hanover
    July 8, 2008 9:34 am

    This was taken from my website from a really faithful fan, he pretty much sums it up …..

    Let me add, the NFL does not like to mix Gambling and Team Ownership, the Rooneys own a few tracks and naturally gambling happens, the NFL Mafia wants it to be seperated, this is just one of the more underlying factors as well …..

    Think about it …. Make sense ?

    QUOTE by DBSFGYD1

    “Upon further review….

    After reading the entire article as published in the print version of the WSJ ( Front page news I might add), as opposed to the condensed web version, this is shapping up to be more of an estate valuation issue.

    Here is the gist, the principle family member want to by out his sibs, but doesn’t have the cash, so he’s going to have to borrow funds. The lenders are only going to lend based on current value, the sib’s want a piece of the future value, feeling that entitlement as their birthright.

    Typically, these matters can get pretty ugly. The estate of the owner of Mondovi wines had the same issue. The Galbreith family that owned the Pirates is another example of poor sucession planning. As for the NFL, how about the fallout with the Falcons & Jets when Smith and Hess died and the instability that insued? Don’t be surprised when the Mara family also has issues.

    As for the Ronney’s, I’m hopefull that the family trait of humility allows for this to work out. My fear is that human nature and greed will reign supreme, and ruins one the best sports franchise ever.

    So much for breakfast this morning……. “



  3. Zsa
    July 8, 2008 9:50 am

    This might be a dumb (and potentially illegal) idea, but can’t the 3 brothers in question work it so somehow the Steelers shares are in their names only and the racetrack stuff is owned by their wives only?



  4. Ex-Pat Pittsburgh Girl
    July 8, 2008 10:12 am

    @Zsa — a lot of times state law or regulation extends to immediately family members as well. Not exactly sure of the NFL rules, but for example, in order to get a slots license in in Pennsylvania, the background check of potential licensees including listing the financial interests of family members. In addition, I don’t know any man who is going to say to his wife, “here honey, you now ‘own’ the more profitable business” wink, wink,wink. Maybe I’m too cynical, but if that’s me and I find out my husband has himself some self-united wives, my first call is to the divorce lawyer.

    I’m not worried about this. The Steelers aren’t going to be sold, but it does make sense for the future of the Steelers to get this figured out. If you think about it, really only two of the Chief’s sons, Dan and Art Jr., have taken an active role in the team. It’s those two (and mainly Dan) that has shaped the public face of the team for all of these years since the Chief died.



  5. In Sewickley
    July 8, 2008 10:16 am

    Amen to the Kennywood comment!

    Yo Quiero El Kennywood.



  6. unsatisfied
    July 8, 2008 10:19 am

    holy info, bill — thanks!

    yeah, this is nothing big. with the whole NFL/betting sensitivity thing and dan getting older, this is something that had to be figured out sooner or later.



  7. bucdaddy
    July 8, 2008 11:10 am

    The irony is, it’s likely no sporting institution in America benefits more from gambling than the NFL. Otherwise, why would anyone watch a Cardinals-Texans game in December?



  8. efw_west
    July 8, 2008 11:58 am

    how about this as a scenario….the transfer of ownership occurs and the “casino” Rooneys ride in to bail out Don Barden, thus giving the Rooney family the control it wants for the whole North Side.



  9. unsatisfied
    July 8, 2008 12:01 pm

    if efw’s vision comes true, perhaps the rooneys could also buy the succos, too. then, they WOULD have pretty much the whole NS……



  10. james
    July 8, 2008 12:40 pm

    it was a spanish company, not a mexican one, that bought kennywood right?



  11. pittgirl
    July 8, 2008 1:29 pm

    Yes, it was a Spanish company, James. I was just kidding about it because so many people were like, “Those damn Mexicans!” when it happened.



  12. Skeptic
    July 8, 2008 7:14 pm

    What am I missing here? If someone owns a football team they can’t have any interests in the gambling business??? Football is BUILT around gambling! That’s why people watch it! The owners of football teams are already in the gambling biz!

    That’s why I chuckled when the Rooneys and the Pirates were so up in arms and said that they didn’t want the casino on the North Shore because it interfered with their “family atmposhphere.” Gimme a break. The only family activity you see at a Steeler game is if you like watching daddy all drunk on his ass.



  13. NoSide15212
    July 8, 2008 7:49 pm

    PittGirl, reminds me of a joke my buddy’s Marine Corps Colonel father-in-law told my friend when he picked up the Colonel’s daughter for their first date: Question: “When is a Mexican considered Spanish? Answer: “When he’s dating your daughter.” My friend was the first child in his family NOT born in Mexico, the son of migrant farm workers in Salinas, CA. Twenty-five years of marriage and 3 kids (one a naval aviator) later, they laugh at how terrified he was when the Colonel deadpanned the joke, then turned and walked away. My buddy said he was all, “wtf is with your old man? Is he serious?” The punchline: the Colonel’s wife was half-Mexican! Totally messing with his head –Dads with daughters rule.



  14. Pensrule
    July 9, 2008 11:01 pm

    I am with EFW’s grassy knoll theory.
    No ones putting this together? North Shore devleopment has stalled and the businesses that went in there early have to be having it rough with profits. Casinos…Rooneys? Coincidence?
    They would have to be seperate entities to do this then Dan and ArtII can claim hands off slots/gambling and be the football sons. This Wall Street dude is probably going to float a loan until its all put together.