Goldman pulls out of Vegas Raiders deal, Davis now faces Adelson’s way or the highway

Remember way back yesterday, when I noted that billionaire Sheldon Adelson pulling out of the deal to build a Las Vegas stadium for the Oakland Raiders didn’t necessarily kill those plans, because Raiders owner Mark Davis had Goldman Sachs lined up as a backup financial partner? Well, that didn’t even last a day:

Goldman Sachs, the banking giant the Raiders told NFL owners would finance part of the $1.9-billion proposal even without Adelson’s involvement, pulled away from the project Tuesday.

The arrangement with Goldman Sachs was contingent on Adelson’s partnership with the Raiders in the development, according to a person with direct knowledge of the situation. Without Adelson, the person said, there isn’t any deal.

It’s not entirely clear here whether Adelson leaned on Goldman not to do the deal without him (he says he didn’t), or Goldman decided that retaining the support of Nevada elected officials was too dicey without Adelson, or Goldman never wanted to do the deal without Adelson and Davis was just an idiot for assuming they would. (Actually, most of the scenarios here involve Davis being an idiot.) Either way, though, this presents a huge stumbling block in the way of Davis cashing in on Nevada’s promise of $750 million in public money toward a stadium, which at least one legislator is threatening to revoke if the Raiders owner can’t work something out ASAP:

The political fallout Tuesday included a suggestion by Aaron Ford, majority leader in Nevada’s Senate, that public money for the stadium could be diverted for other purposes if the situation isn’t quickly resolved.

“If progress is not made toward financing the stadium project in a timely fashion, we will introduce legislation to create the jobs that were promised and contemplated by stadium construction,” Ford said.

All the leverage is back in Adelson’s court, in other words, if he wants to resume his demands for a large cut of team revenues and possibly of ownership as well. You have to figure he’ll at least try, because he’d be stupid not to — though there’s enough stupid already floating around this deal already that a little more wouldn’t be all that surprising.

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15 comments on “Goldman pulls out of Vegas Raiders deal, Davis now faces Adelson’s way or the highway

    1. Toronto can barely sell enough tickets for their cfl team in a 30,000 seat stadium. You think that they will be able to sell 70,000 seats for an nfl team? I don’t think so.

      1. They tried to sell 53,000 seats for the Bills in Toronto series and failed at that too.

        The official reason we were given: it wasn’t “Toronto’s” team. It’s worth keeping in mind that that series was billed (no pun intended) as the first step to the Bills relocating to Toronto when Wilson died. Funny how four years of deeply discounted tickets that never resulted in a sellout has changed the narrative.

        1. Deeply, deeply discounted…friends went up there for Bears/Bills and were given tickets for free. Reps of the promoter had stacks of them they were passing out on the street a couple days ahead of time.

  1. “All the leverage is back in Adelson’s court, in other words, if he wants to resume his demands for a large cut of team revenues and possibly of ownership as well. ”

    Would the other NFL owners approve a move under those conditions?

    1. Almost certainly yes. There is nothing the NFL would like more than having someone who is not named Mark Davis having effective control of the Raiders.

  2. Shit, if teams sharing stadia is the new black, then I bet Arlington would bend over backwards with all kinds of money for team willing to move into a stadium that’s already been built.

  3. Goldman and Adelson running a bad cop/bad cop tag team on Davis. Gee, didn’t see that coming… maybe this is how the NFL eases one of it’s most unpopular franchisees out the door.

    1. No one knows what is happening behind closed doors, but Adelson has actual resources that could be used to secure a loan. Beyond the Raiders franchise itself Davis has a late-model Dodge Caravan and some PF Change gift cards.

      Maybe Goldman actually learned something from those NINA loans that were all the rage a decade ago.

      1. Essentially it boils down to this: Goldman is Adelson’s company’s largest creditor and sees an endgame that is much more long-term than financing a football stadium. No need to threaten that relationship for one much less fruitful and wrought with risks.

        Again, no one wants to address the other issue: how in the hell was Davis getting $200 million from a fund that is broke? Goodell continues to spew this alternative fact as if the money is actually there when it is not.

      2. I believe Goldman learned that there is no mess they can create that their friends (and co-workers) in government won’t bail them out of. It’s a taxpayer put.

        Jay: I think that has been addressed after a fashion. Goodell et al would simply lean on the PA to agree to a recapitalization model under threat (real or perceived) of loss of jobs. The fund can be recapitalized the same way it was originally funded.

        No-one is saying that IS what would happen, but it certainly is an option.

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