USL Sale Complete: Reporters Notebook’s……Owners Upset (UPDATED 5:30 PM MONDAY)
(MONDAY EVENING UPDATE BELOW)
USL announced Thursday afternoon, Nurock Soccer Holdings LLC has purchased the USL from Umbro/Nike.
Brian Quarstad of Inside Minnesota Soccer and Major League Soccer Talk are currently working on the story……and will update the story as warranted.
We are aware that the sale to Nurock is a shock to many including some owners in the league. It’s widely known that Traffic FC along with a current USL-1 owners group made a bid for league but did not win that bid. However, that same owners group led by Aaron Davidson of Miami FC and Selby Wellman owner of the Carolina Railhawks, have been unhappy with Marcos and Executive VP of USL Tim Holt. We had been informed by multiple ownership sources, that Davidson and Wellman were working with another group who were in the due diligence stage after winning the bid from Nike. The other group who had reportedly won the bid was not either Nurock or Traffic.
The comments in the press release from Francisco Marcos, Founder and President of United Soccer Leagues are telling. The comments from Marcos could mean that the newly announced owners, Nurock, have a current relationship with USL executives Holt and Marcos. If this is true, the league owners will have some very difficult decisions to make this winter unless of course they are able to form a relation with Nurock executives Rob Hoskins and Alec Papadakis. The ownership group has been pushing for more visibility and aggressive marketing of USL.
Adam Beasley of The Miami Herald reports that Miami FC could shut its doors because of this move and also reports that the Minnesota Thunder and Carolina Railhawks were believed to be part of Traffic Sports bid.
Another telling sign of a possible relationship between Nurock and USL executives can be gathered from Papadakis statement in the press release:
“Together with USL Management, we are excited about the opportunity to grow the size and visibility of USL, and to help develop and train the future generations of soccer athletes in the United States,” said Alec Papadakis, CEO of NuRock Soccer Holdings.
10:00 PM ET UPDATE
Inside Minnesota Soccer has spoken with Tim Holt, Executive Vice President & Chief Operating Officer for USL. Holt was asked about a third party who supposedly had won the bid from Nike and was in the due diligence stage when NuRock was announced as the owner. Holt said that USL management has been aware of all the groups that made bids but denied having inside information on the individual bids. Holt did admit that Nike had consulted with USL officials in what the League was looking for in terms of a new owner.
“I can’t tell you how exactly we got here in regard to Nike’s sale of the league,” said Holt. “That’s all I can do is talk about the present and future.”
When asked about prior knowledge of the NuRock group and a possible USL relationship with the group, Holt said that you can’t read too much into the press release. “We’re familiar with all the groups that made bids for the league,” said Holt. “Some were from outside the league and others from inside the league. But we’re familiar with them all. Are we familiar with Rob Hoskins and Alec Papadakis from NuRock? Yes, and we have respect from the NuRock people in what we’ve accomplished at USL. Have we done everything perfectly and is there room for improvement? Of course there is and I’m sure there will be some changes made.”
Holt was asked about the terms of the new deal with NuRock and the franchise that was awarded to Hoskins for a USL-1 team in Atlanta. Boris Jerkunica was the former owner of the Atlanta Silverbacks and withdrew from the league last fall after being unhappy with the current USL management. Jerkunica was also concerned about an MLS franchise moving to the Atlanta area which had been rumored at that time. Sources had told IMS and MLS Talk that a team could withdraw from the league for a year and then return since they still owned a franchise. Holt refuted those sources.
“There’s no leave of absence clause,” stated Holt. “Each franchise must recommit annually and compete in every season. If they do not, then they do not retain their franchise rights.” When asked about the $750,000.00 franchise fee, Holt said there are original franchise fees and annual league dues as well. “The franchise acquisition fee is not refundable. If you withdraw from the league, we reserve the right to re-sell the territory to another group,” said Holt.
The Atlanta Silverbacks were assumed from the Atalanta Ruckus in 1998. The Ruckus had entered into the A-League in 1995.
Holt was asked if he had talked to the new owners about any specific changes that might happen in the league. He said that it was too early for that and USL had just received final word of the sale themselves. He also stated that the league will be very busy the next several months as the new owners take their place and the league works to prepare for next season.
11:30 AM FRIDAY UPDATE
IMS and MLS Talk confirm that several USL-1 owners were caught off guard by the news of the sale to NuRock.These owners were infomed via press release or word of mouth rather than formally by Nike or USL’s office in Tampa.
It is confirmed that the owners were working as recently as Wednesday with another US based group that was working with Nike on completing the acquisition of the USL. This group is very involved in American soccer circles, and were favored by these same owners to take over the league.
As always this, is an unfolding story and we will continue to bring you the latest.
7:00 AM Saturday Update
Inside Minnesota Soccer and MLS Talk have been continuing to gather information concerning the story of the USL to NuRock. We hoped to bring you that story Monday morning and planned on including the name of the 3rd party who had made the highest bid to Nike. That party was awarded the bid several weeks ago and was in the final stages of the due diligence period when told that USL had suddenly been sold to NuRock Soccer Holdings
IMS and Major League Soccer Talk plan on bringing you a detailed story on Monday morning. For now we will tell you that the Third Party was Jeff Cooper of St. Louis.
Cooper, a very respected name in the Midwest soccer scene had joined forces with a number of other investors. It’s been said that Cooper was still in contact with Nike lawyers as late as Wednesday afternoon and there was no hint of trouble in the negotiations. Several sources who did not want to go on record stated that Cooper was stunned to hear that the USL had been sold to NuRock.
The USL owners group had been working closely with Cooper the last several weeks after he was announced as the high bidder by Nike. It was also reported that Cooper was within a day or two of completing the transaction and Nike gave him no warning of this 11th hour switch.
We have also learned that there were no attempts from the USL front office to contact any of USL-1 owners, notifying them of the sale of the league. Most of those USL owners found out about the sale to NuRock on Thursday through the same press release that was sent out to the general public and published on the USL website.
FULL PRESS RELEASE IN COMMENTS
MONDAY EVENING UPDATE
As IMS and MLS Talk have been reporting since Thursday, the majority of USL-1 owners are uncomfortable with the sale of the league to NuRock. This evening the Owners Association has released the following to the press:
TEAM OWNERS ASSOCIATION CHILLS RELATIONS WITH USL
AFTER NIKE SELLS USL TO NON-TEAM THIRD PARTY
Atlanta, Carolina, Miami, Minnesota, Montreal, St. Louis, Tampa and Vancouver
to Aggressively Explore all Options for Future
August 31, 2009. Following extensive negotiations with USISL, Inc., the parent company of the United Soccer Leagues (USL), to restructure the USL First Division (USL-1) into a league owned and controlled by its teams, the Team Owners Association (TOA) today announced that it has accelerated its pursuit of all league options for the 2010 season and beyond. The TOA, led by the Atlanta Silverbacks, Carolina RailHawks, Miami FC, Minnesota Thunder, Montreal Impact, St. Louis Soccer United, Tampa Bay Rowdies and Vancouver Whitecaps, reached this decision following the announcement by Nike, Inc., the parent company of USISL, Inc., that it had concluded the sale of USL to a third-party (NuRock Soccer Holdings) which does not own a team in USL-1.
The TOA has been and remains committed to a restructuring of USL-1 into a truly professional soccer league which complies with the international rules established by FIFA, the governing body of international soccer. These rules include the requirement that the league be owned and controlled by its teams. Despite this rule, USL has historically been owned by a single corporate entity responsible for, among other things, league governance. The TOA believes that this ownership structure has stunted the growth and recognition of both the league and its teams during USL’s nearly 25-year existence. Consequently, over the past several years, the TOA has engaged in discussions with the owners of USL to restructure USL and is therefore extremely disappointed with Nike’s decision to sell USL to a non-USL-1 team owner. Accordingly, the TOA now reconfirms its commitment to achieving a team-owner controlled league and will pursue all avenues to do so.
“The TOA and its teams thank the fans, media, coaches and players for their unconditional support and patience as we explore all options for the future,” stated Selby Wellman, majority owner of the Carolina RailHawks and spokesperson for the TOA. “The teams are confident that this process will lead to decisions and changes that are essential for the further growth of soccer in our respective markets and throughout North America.”
The TOA was formally established in January 2008. Carolina, Miami, Minnesota, Montreal and Vancouver are all playing in USL-1 this season, but have not recommitted to USL-1 for 2010. Atlanta withdrew from USL-1 after the 2008 season due to the continuing uncertainties of the negotiation and restructuring of USL. Tampa is scheduled to begin playing in USL-1 in 2010. St. Louis Soccer United, owner of the St. Louis Athletica in WPS, is committed to establishing a men’s professional team. Notwithstanding the fact that Vancouver will be joining MLS in 2011, the Vancouver ownership group is committed to playing in 2010 and to exploring establishing a team in another market for 2011 and beyond.