Daily Archives: July 28, 2009

Stan Kroenke’s sports holdings have expanded to include Major League Soccer’s Colorado Rapids and their outdoor stadium, Dick’s Sporting Goods Park; the National Lacrosse League’s Colorado Mammoth; and a one-third interest in the Arena Football League’s Colorado Crush.

(From Denver Business Journal Article)  Stan Kroenke — owner of the Denver Nuggets and Colorado Avalanche — increased his stake in English Premier League soccer team Arsenal this month to nearly 29 percent, strengthening his position as the largest shareholder of the north London club that has been referred to as “the Bank of England.”

Kroenke’s latest move reinforces his reputation as a savvy, if quiet, operator in the sports industry and beyond.

Despite modest beginnings in small-town Missouri, Kroenke has built a business empire that includes vast real estate holdings, seven professional sports franchises, an arena and a stadium, a regional sports television network, the largest privately held cattle ranch in Canada, and two California wineries.

His assets are valued at $3 billion, according to a recent estimate by Forbes. His wife, Ann, a daughter of late Wal-Mart co-founder James “Bud” Walton, inherited her own fortune, now valued at about $2.6 billion.

Yet for someone with such high-profile assets, Kroenke — who divides his time between Denver and Missouri — remains a strikingly elusive character. He rarely speaks in public. He avoids the attention some other team owners relish.

Michael Staenberg, Kroenke’s business partner at THF Realty in Chesterfield, Mo., said the two have a policy not to talk about each other. Tom Irwin, executive director of Civic Progress, an organization of executives of St. Louis’ largest companies, said Kroenke doesn’t attend their meetings. And business associates who previously worked for Kroenke did not return calls but notified Kroenke’s office in Denver about them. An assistant said he was unavailable for an interview for this story.

Defenders say Kroenke is simply a busy businessman with interests that stretch from coast to coast and beyond. But even among fellow billionaire team owners, Kroenke is said to be respected yet reclusive.

“He usually holds his cards close to the vest, has strong legal positions, and is well-capitalized so he has no real need for cash. He is in an enviable position,” said Marc Ganis, president of Sportscorp Ltd., a Chicago-based consulting firm.

Phil Thomas — a former vice president of sales and marketing of the St. Louis Rams football team, of which Kroenke is a minority owner, and now head of a Missouri consulting firm — said Kroenke would come to St. Louis for nearly every Rams home game and shares a love of sports. But he carries himself with measured reserve.

“His passions are his family, sports and business. He goes 100 percent with almost anything he is involved with,” Thomas said. “But he would be a world-class poker player because he always has a game face. He doesn’t speak very often. But when he does, everybody listens.”

For all his reserve, though, Kroenke is not shy about making power plays. He beat out a group led by former Denver Broncos quarterback John Elway to buy the NBA’s Nuggets, NHL’s Avalanche and the Pepsi Center arena for $450 million in 2000 after an acquisition attempt by Kroenke’s brother-in-law Bill Laurie fell flat.

Kroenke purchased his 40 percent stake in the Rams and helped relocate them to St. Louis from Los Angeles in 1995 after an attempt to land an NFL expansion team here flopped.

A mogul from Mora

Enos Stanley Kroenke, 61, was reportedly named after St. Louis Cardinals greats Enos Slaughter and Stan Musial, fitting monikers for a boy who would grow up to be a sports mogul.

He was raised in Mora, Mo., a tiny town between Kansas City and Springfield. His family owned a hardware store there. After high school he moved to Columbia, Mo., to attend the University of Missouri. He earned a bachelor’s degree in business followed by an MBA and met his wife, who was a nursing student at the university, during a vacation in Colorado. The two have made a home in Columbia ever since and raised their daughter, Whitney, and son, Josh, in the campus’ shadow. Josh played basketball for the Tigers before graduating in 2004.

Early on, Kroenke developed a close relationship with the late Bud Walton and Bud’s brother, Wal-Mart co-founder Sam Walton. They mentored him about business and real estate development. In the mid-1970s, Kroenke began developing Wal-Mart-anchored shopping centers throughout the Midwest.

In 1985 he started The Kroenke Group, a private real estate investment and development firm based in Columbia. And in 1991 he co-founded THF Realty here with Staenberg. The shopping center developer’s acronym stands for “To Have Fun.”

Kroenke’s companies have run with their Wal-Mart connections and developed big-box shopping centers across the country. Today THF Realty manages 20 million square feet of retail and office space in 17 states. It reported 2008 revenue of $222.3 million. In Missouri alone, THF Realty has developed more than a dozen major projects.

It’s unknown how much Kroenke has made doing business with the world’s largest retailer. But while Kroenke served on Wal-Mart’s board of directors from 1995 through 2000, company proxy filings publicly disclosed he collected $130 million in rents and fees from Wal-Mart between 1994 and 2000. In his final year on the board, Kroenke’s take totaled nearly $23.5 million. He also owned 1.08 million shares of Wal-Mart stock. If he still owns them today, they are worth about $52.4 million.

Kroenke’s successful retail real estate deals, along with the treasure chest his wife brings to the table, have helped fuel many of his other purchases.

In 2004, Kroenke Sports Enterprises also launched Altitude Sports & Entertainment, a 24-hour regional TV network that broadcasts Kroenke’s Colorado teams’ games and other programming.

Next moves

Now Kroenke appears to be on the verge of more big moves. In St. Louis, he has the rights to match any offer for the majority interest in the Rams.

Chairman Dave Checketts of SCP Worldwide, the owner of the St. Louis Blues and Major League Soccer’s Real Salt Lake, is putting together a bid for the football team. FedEx founder and CEO Fred Smith’s name also has been floated as a potential suitor, though the Memphis Commercial Appeal cited an unnamed source who said Smith is not interested in a majority share.

If Kroenke decides to take the lead role with the Rams himself, NFL cross-ownership rules would require him to sell his NBA and NHL teams in Denver, where the NFL’s Broncos play. Unless he could persuade his fellow owners to waive the rule for the first time, he would have to say goodbye to the Nuggets, and by all accounts, basketball is Kroenke’s true passion.

“If that’s your first love, it is hard to envision giving that up,” Ganis said. “But on a business level, the NFL is the league to be in, and Stan is a business man. Other than owning a specific team like the Yankees, owning a team in the NFL is considered the highest status in American sports.”

Then there is Arsenal, a powerhouse franchise with global growth opportunities.

If Kroenke achieves the 30 percent ownership mark as many expect he could soon, he would trigger an ownership clause that would require him to make an offer for all of the soccer club’s remaining shares. Arsenal Holdings plc has a market capitalization of about $722 million. But in April, Forbes estimated Arsenal’s value at $1.2 billion, behind only Manchester United and Real Madrid among the world’s most valuable soccer franchises.

Selling his Rams stake, estimated to be worth about $350 million, could be one way for Kroenke to raise funds for an Arsenal takeover.

Whatever he decides, it looks like Kroenke is in a position to determine his own course.

“It will be a choice based on lifestyle more than anything else,” Ganis said. “He creates business opportunities that end up being his choice instead of someone else’s.”