Where do Rooneys go from here?

With one bid off the table, Steelers ownership in limbo

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Shortly after learning his bid to purchase the Steelers was rejected, New York billionaire Stanley Druckenmiller called Dan Rooney on Thursday night to congratulate him and wish him luck in his attempt to buy part or all of the 64 percent shares owned by his other four brothers.

He might need it.

The path toward resolving what has become a burgeoning and complicated issue might not be without more detours for Rooney and his son, Art II, to gain controlling interest in the franchise founded by the late Art Rooney Sr. Especially after Dan's brothers -- Tim, Art Jr., John and Pat -- rejected Mr. Druckenmiller's up-front cash tender because they might be seeking to gain more money from a new outside investor for each of their 16 percent shares in the team.

At the same Thursday afternoon meeting in which they decided not to accept Mr. Druckenmiller's offer, the brothers also decided not to take any action on the bid made by Dan Rooney -- despite a motion by John Rooney to accept his oldest brother's offer, according to a family source.

The result: The ownership structure of the Steelers might not be any closer to being resolved than it was when the process began nearly two years ago.

Dan Rooney would not publicly comment yesterday on the prospect, but, in a joint statement he released with Art II, the team president, he said, "While we would have preferred our bid to have been accepted, we will continue our efforts to maintain the ownership of the Steelers in our family.

"We have been told on many occasions the other family members prefer to keep the franchise in the family. We look forward to ongoing dialogue within the family toward that goal."

The question remains, though, when will that be?

And at what price?

The Post-Gazette has learned the enterprise value of Mr. Druckenmiller's bid on the Steelers was $840 million, a price that takes into account the value of the entire business and includes the purchase of stock, not assets.

Enterprise value is a figure that represents the entire cost of a company if someone were trying to acquire it. It is a more accurate estimate of takeover cost than market capitalization because it includes preferred stock and cash reserves, but, in this instance, not debt.

Therefore, if each of the brothers sold their shares to Mr. Druckenmiller, they would each receive $134.4 million, or 16 percent of $840 million. If all four brothers sold their shares, it would cost Mr. Druckenmiller $537 million.

When the four brothers rejected his bid, Mr. Druckenmiller immediately withdrew his offer.

"I was told it didn't receive significant support," he said.

Meantime, the decision by the four Rooney brothers could, and likely will, mean another lengthy delay in the team's attempt to restructure its ownership to comply with NFL guidelines. They just spent seven months pondering Mr. Druckenmiller's bid before rejecting it, and now face the unenviable, perhaps unrealistic, task of finding a suitor at a time when Wall Street investors are skittish and uncertain about a plummeting market.

Or they can consider the only offer that remains on the table -- the one offered by their brother, Dan.

Either way, it doesn't seem as though that will pose a problem for the NFL.

League spokesman Greg Aiello reiterated in an e-mail yesterday that NFL Commissioner Roger Goodell has not set any deadlines for the ownership issue to be resolved. Beyond that, the league declined comment.

Mr. Druckenmiller, chairman of Pittsburgh-based Duquesne Capital Management, was approached by the four Rooney brothers in February about purchasing their combined 64 percent shares in the franchise. For seven months, the process thrust the 55-year-old hedge fund manager into the national spotlight, a position he has spent most of his life trying to avoid.

But he said he never changed his bid, and was "disappointed" when it was finally turned down.

"I don't like being in the press," Mr. Druckenmiller said. "I really need to disappear again, and I need to start now."

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


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