´ Steel Curtain Rising: Pieces of Steelers Ownership Restructuring Puzzle Falling into Place?

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Thursday, August 7, 2008

Pieces of Steelers Ownership Restructuring Puzzle Falling into Place?

Bouchette’s article in Sunday's Post-Gazette shed a lot of light on the Steelers ownership restructuring process, but also left many unanswered questions. Bouchette indicated that Dan Rooney had divested his shares of the race tracks and that his brother Art has divested 90% of his shares. Also brothers Tim and Pat have resigned from the Steelers Board of directors

This is an unequivocal sign that the dice have begun to roll.

Unknowns Still Remain

Bouchette’s article shed a lot of light onto a complex story, but many unknowns remain.
  • What is the value of Dan Rooney’s shares of the race tracks, and who bought/assumed control of them?

Given that the Racetracks are far more profitable than the Steelers, one has to figure that Dan Rooney’s shares in those have to give at least enough money to buy out one of his brothers, assuming that red tape and taxes that go behind transferring these share doesn’t eat up too much of their value. This has been a major issue since the story broke, and it still lacks clarity.

  • What’s Art Rooney Jr. up to?

Why did Art Rooney divest most his shares of the race tracks? Notice, Art Jr. did not resign his post on the board of directors -- does that signal that he intends to stay on as a Steeler owner? Does it mean that he is trying to position himself to make a power play to regain the role in running the team that he lost in 1986 when Dan fired him as head of scouting? Perhaps Art Jr. is just chasing in all around, but his partial divestiture is quite peculiar.

  • Why didn't John Rooney also resign from the Steelers Board of Directors?

The resignations of Tim and Pat Rooney signal their intent to get out of the football business, these were expected. But why has John Rooney not followed suit? There could be trivial reasons for this, but more hard news on this would be helpful.

  • What is Art II's stake in the Steelers be when this is over?

When the story broke, the reports talked about how Art II and Dan were trying to obtain controlling interest. Since then all reports have focused on Dan Rooney’s efforts. Writers could simply be saving space (not one of my graces, but hey, its my blog!) or it could be that Art isn’t going to be a buyer. I am ignorant on the rules of finance, but common sense indicates that, if/when Dan does buy out all or part of his brother shares, he simply can’t add his son’s name to the invoice and give him possession of the team. (Perhaps there are ways he can do this.)

Even if that Dan Rooney succeeds in obtaining controlling interest of the Steelers, he still must grapple with the issue of how to pass it on to his son Art II, without Art II getting crippled by inheritance taxes.

Joe Robbie’s heirs tired and failed to deal with the inheritance tax issue, but it can be done. Paul Brown was able to pass the team on to his sons. One would hope that Dan would have a plan for this, but it’s also possible that the restructuring process prevented him for addressing this issue.

Regardless, no journalist, inside or outside of Pittsburgh has written about this. It would be nice if they did.

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