Analysis: Next move, if any, must go to Penguins

Lemieux, Burkle would welcome counteroffer, but Pirates' stance firm

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What happens next between the Penguins and Pirates will depend on which party decides to move the process forward.

Assuming either side does.

Mario Lemieux and Ron Burkle, co-owners of the Penguins, recently made an unsolicited offer to buy the Pirates in a meeting with that team's owner, Bob Nutting, but the offer received no response. Moreover, as Mr. Nutting reiterated in the Pittsburgh Post-Gazette article Saturday about that offer: "The team has not been for sale and is not for sale."

Sources on the Penguins' side described the offer by Mr. Lemieux and Mr. Burkle as "very serious" and said their interest is no less intense now than when the meeting took place four months ago. On the Pirates' side, the stance is similarly clear that the team is not for sale.

So, what might change?

That almost must begin, as with the initial approach, on the Penguins' end. The preference of Mr. Lemieux and Mr. Burkle, according to sources, is to receive a counteroffer to the original offer, for which the dollar figure was not divulged. But, because so much time has passed without the Pirates responding -- Mr. Nutting's position for the lack of a response is that "no substantive or formal offer" was made -- that seems highly unlikely.

It also is known that Mr. Lemieux and Mr. Burkle could make another offer -- unsolicited, like the first -- and see if that brings a response.

One thing to bear in mind: Mr. Lemieux and Mr. Burkle, in different ways, have a history of getting what they want. In the past decade, Mr. Lemieux brought the Penguins out of bankruptcy in a months-long process, then threatened to move the franchise to Kansas City if politicians did not help pay for a new arena -- a process taking years. Mr. Burkle, whose personal worth is estimated at $3.5 billion by Forbes magazine, made his fortune in the grocery business but now owns more than 30 companies.

The full scope of the Penguins' motivation will not be known until Mr. Lemieux or Mr. Burkle comments, and neither has. But sources on the Penguins' side say they would welcome the potential "synergy" between two franchises in the same city with schedules that do not overlap much. That includes shared marketing, sales and local television.

Each team's television rights are owned by FSN Pittsburgh, and each is generally satisfied with its rights fees. Another possibility is starting a fledgling cable network, which is becoming more common for sports franchises. Those tend to need more than one major league team to sustain year-round programming.

Also, according to the sources on the Penguins' side, Mr. Lemieux and Mr. Burkle would be willing to raise the Pirates' player payroll with an aim toward making the team more competitive.

The Pirates' projected opening-day payroll for 2010 is $35.6 million, which could be the lowest in Major League Baseball. The team's explanation is that payroll is low only because veterans were traded for prospects last year. Once those prospects mature, as Mr. Nutting said in an interview last weekend, payroll will rise into the $75 million range of the Milwaukee Brewers and Cincinnati Reds, their market and division peers.

For the Pirates, the internal focus will remain on preparing for the season that opens April 5. But, should this ownership story play out further -- and even if it does not -- it could make for quite the distraction.

Mr. Nutting has dealt before with public discussion about potential sales since he became controlling owner in January 2007: Mt. Lebanon billionaire Mark Cuban, owner of the NBA's Dallas Mavericks, inquired and was rejected. Pittsburgh attorney Chuck Greenberg inquired several times and was rejected before succeeding in buying the Texas Rangers earlier this month. Both were told the Pirates were not for sale, and no negotiations took place.

The Pirates' stance remains in place, but this situation could be different, partly because the Penguins' recent success is so close to home but largely because of the enormous popularity of Mr. Lemieux. The Pirates, especially after years of failure, have little chance to dispel what is sure to be a public clamor to sell to Mr. Lemieux.

That was apparent with much of the sentiment expressed by season-ticket holders and other fans Saturday at the team's promotional PirateFest at the David L. Lawrence Convention Center --"He knows what it takes to build a winner," Bonnie Matthews of Murrysville said of Mr. Lemieux -- as well as in the Pirates' management Q&A session attended by more than 500 people.

Mr. Coonelly, clearly braced for a response from the crowd, made a pre-emptive strike by addressing the topic before the floor was opened to questions. He first repeated Mr. Nutting's quote Saturday that "no formal, substantive offer had been made," then added, "We had a meeting four months ago with Bob, Mario and Ron Burkle. But what I can confirm for you, at that time, today, tomorrow, next week, the Pirates are not for sale. Bob Nutting is committed to making the Pirates a winner again."

That drew applause from only a handful, as well as a couple of boos.

Athletes in any team sport can be distracted by word of a potential ownership change, but it is difficult to imagine any effect among the Pirates' management: Mr. Coonelly, general manager Neal Huntington and manager John Russell, all of whom have a reputation as dawn-to-dusk workers, are not easily distracted.

Still, they -- and Mr. Nutting -- are sure to take the brunt of criticism if the Pirates' record streak of losing seasons is extended to 18, and a 20-win improvement would be needed for a plus-.500 record.

Teams have won with payrolls in the Pirates' current range, notably the 2008 Tampa Bay Rays who took the American League pennant. The Pirates' management expresses faith that its current young group can succeed soon -- a view shared by others around baseball -- and that group will add elite power-hitting prospect Pedro Alvarez sometime this summer.

That potential for the team raises another issue: Mr. Nutting has been anything but an owner in absentia. He has displayed a deep interest in the team's workings -- he is on a first-name basis with most of the roster -- and those close to him say he is determined to "follow this through," to borrow one of Mr. Nutting's commonly used phrases.

Mr. Nutting's strongest statement on the subject came in August when asked if he might sell the team. He replied: "Absolutely not. My family plans to own this franchise on a multigenerational level, and I look forward to my daughters being involved someday as well."

No aspect of that sentiment is known to have changed, though Mr. Nutting's meeting with Mr. Lemieux and Mr. Burkle and discussing an offer -- no matter which team's view one might accept about that offer -- is sure to raise questions on that front for the foreseeable future.

Dejan Kovacevic: . Find more at PBC Blog .


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