As doubts continue to swirl around prospective Grizzlies owner Robert Pera's bid for the team, word surfaced Wednesday that the former-billionaire millionaire has begun discussions for local partners to take on as much as a third of a minority share of the franchise alongside his majority share purchase from current owner Michael Heisley.
An NBA spokesman confirmed to Ken Berger of CBSSports.com that the league was in fact considering the current business affairs of Pera in its evaluation of the tech prodigy in advance of a potential vote from the NBA Board of Governors. But the NBA does not expect any hiccups in the process, and considers this part of the normal vetting process for any prospective owner.
"The vetting process on the proposed sale is proceeding on pace and we hope in the next several weeks to be able to approve the transaction," NBA spokesman Mike Bass said Wednesday.
Pera has come under scrutiny in regards to the bid on two fronts. First, the stock of his company, Ubiquity Networks has fallen dramatically in the last two months, by nearly 60 percent according to experts. Pera technically fell from the rank of "billionaire" the same week he reached an agreement with Heisley on the team, according to Forbes Magazine. Meanwhile, SportsBusiness Journal reported this week that the NBA has concerns regarding a recent warning Ubiquity received from the U.S. government when it was discovered that a distributor for the company sold goods to Iran in what was deemed an oversight of management by Ubiquity.
Meanwhile, league sources tell CBSSports.com that NBA officials are investigating all of the above matters as they pertain to Pera's ownership bid, as is standard procedure with any proposed team purchase. As for Pera's reportedly diminished financial condition, a likely compromise would be for Pera to recruit additional investors to contribute funds. Sources confirm that Pera is engaged in such discussions with AutoZone founder J.R. "Pitt" Hyde as well as FedEx CEO Fred Smith. Those discussions were first reported Wednesday by The Commercial-Appeal.
The Commercial-Appeal reports that sources close to Pera say the involvement of local ownership has more to do with community concerns about new ownership's commitment to the city and not as a result of the financial fallout outlined in the Sports Business Journal report earlier this week.
Either way, a move towards local ownership would help quell fears of a possible reloaction, despite fervent denial of any such possibility from both current ownership and those close to Pera.
So while this doesn't project to be the smoothest of transitions, nor does it appear that the team will fail to get a fresh start as Heisley finally gets his wish to sell the team, which has been a pursuit for years.