Sherman Ragland Q&A
With former Los Angeles Clippers owner Donald Sterling now suspended for life from the NBA, the possibility of selling the team is much higher, with an owners vote looming as well as a lawsuit against the league by Sterling.
Sherman Ragland, a successful real estate developer and 1984 graduate of Towson, is planning to make a run at investing in the Clippers. He spoke with The Towerlight about his plans and thoughts on the Donald Sterling scandal.
Can you give us some information about how you got interested in buying the Clippers?
My brother-in-law happens to own a professional basketball team in the United Kingdom called the London Lions. It’s the only professional basketball team in London. And he has had conversations back-and-forth with the NBA about having a bigger presence in Europe. We were talking, as many people were as this whole thing was unfolding, and we said you know what? Why don’t we take a run at this? And so, we have lined up a couple of high-network individuals, who at this point don’t want their names disclosed yet. But the other thing that we thought would be important was that we set up a website for crowd funding. We set that up over the weekend…It’s called anewdayinla.com. Our idea is that we could probably raise $250-$500 million just off the website. And that’s really based on what’s going on the Internet with crowd funding. It has become the great equalizer when it comes to raising money from pools of people across the country.
What attracts you about basketball?
The Clippers really have the potential to be one of the premier teams [in the league]. The NBA as an investment and a professional sport enterprise really is the platinum standard. The NBA goes beyond the United States of America. There are kids all over the globe wearing Nike shoes attached to Michael Jordan and Kevin Durant. Basketball at that level is a global language. Having said that, we have not seen the NBA really expand that much beyond the shores of the United States but that day will also come. It’s sort of like watching soccer play out in the United States. So, if you were to own a professional sports franchise, clearly owning a basketball team would be at the top of the list. When you talk about profitability as an enterprise purely from the business side of it, it’s really hard to beat basketball versus baseball, football, hockey, etc. It really is the premier investment for someone who can pony up the change and get in the game.
What do you like about the Clippers franchise as it stands?
Los Angeles [is a] a major media market. There’s no question that team has never had the resources that it has needed. Minus Mr. Sterling and going beyond this whole thing that blew up… has he really maximized the value of the team? And a lot of people look at it and argue, no, he hasn’t come close. So, there’s a lot of upside to owning the Clippers.
What are your thoughts on Donald Sterling as an owner and what are your feelings on the whole situation?
From Mr. Sterling’s perspective, it was unfortunate. There are people who say it’s a free speech issue. I think commissioner Silver handled it best when he said: Be respective of how Mr. Sterling’s feelings came out, but the bottom line is they’re out in the public now and his feelings are not the feelings of the National Basketball Association. I think it was inevitable that sooner or later there was going to be a head-to-head with Mr. Sterling…I don’t know him. I have no intentions of ever meeting him. I don’t even believe that the league is going to allow him to sell the team. I think the league will buy the team and sell the team. They want to totally disassociate themselves from this person. Some people can argue that people have the right to say what they want in private. That’s true, but once you own a professional franchise and step onto the face and become a public figure, people have the right to say, “We’re not going to give someone with these views our money.” Basketball players have the right to say, “We’re not going to give our talents to someone with those views.” At the end of the day, it wasn’t really a free speech issue. It was an economics issue. The rate that Mr. Sterling was putting his foot in his mouth, the Clippers was losing $15-$20 million a day in value with all the sponsors pulling out and the players and management say they were leaving once the season was over. So, at the end of the day, his views were not only tarnishing the league, they were detrimental to the value of basketball to that team. He was dragging the entire league down the toilet with him.
How do see this process playing out?
I think the first big hurdle is, will Mr. Sterling go willingly into the night, or will he put up a fight? It’s going to come down to, is he going to act with his head or his heart? He can fight this thing if he wants to, but it’s not in his best investing interest. I think the league actually saved him from himself. By stepping in as quickly as they did, a lot of the sponsors who might have pulled out are going to stay because they know Mr. Sterling is out. I think what’s going to happen is that the process will be pretty quick. Literally, a matter of months. The underlying issue is going to be: What’s the size of the check? I suspect the league will buy it and it will take place over the summer. I suspect that then they’ll announce the guidelines for anyone who wants to purchase. There will probably be initially 10-15 groups expressing interest, but at the end of the day there will end up being two, maybe four groups who combine and consolidate and really go after it. I think clearly the financial aspect is going to be a big piece of it. That team go for as much $600 million, $700 million. There has to be clear financial background to be able to do that. I think there will definitely be an African-American or African-American group that will be represented in a big way in ownership. I think another aspect of it will be the crowd funding: The ability for the average person to buy a piece of a professional basketball franchise.
Could the Clippers come to Baltimore?
Two things: One, if you’re already in Los Angeles, you’d never leave. You’d never leave L.A. for D.C. Having said that, could there be conditions and some kind of presence in Baltimore, sure. But a permanent relocation is probably unlikely because the economics wouldn’t allow for that to happen. Another part that is equally important is that [Wizards owner Ted Leonsis] wouldn’t allow it. I think the office would have no problem with playing a game or two in Baltimore. But a permanent relocation, I think he’d probably veto that in a heart beat.
-Compiled by Matt Hamilton