New Partner and Arena for Kings Reported

Owner Bruce McNall of the Los Angeles Kings has reached an agreement to sell a major stake in the franchise and will become a partner in a group committed to building a state-of-the-art arena for the National Hockey League team, sources said Tuesday.

The site of the proposed arena has not been determined, but the sources said it possibly would be constructed at the Inglewood location of the Forum, where the Kings now play, if negotiations to include that building’s owner, Jerry Buss, in the deal are successful. Buss also owns the National Basketball Assn.’s Los Angeles Lakers, who would also play in the new arena.

“Jerry is not committing the way Bruce is at the moment, but he understands the deal and wants a new building,” one source said.

Buss is expected to attend a news conference at the Forum today, when the principals will announce the agreement.

McNall, who sources said will retain controlling interest in the Kings, agreed to sell a “significant and substantial” portion of the team to two IDB Communications executives, chairman Jeffrey Sudikoff and director Joe Cohen. As part of the deal, McNall would have an unspecified interest in the planned arena, in addition to whatever cash he receives now.

McNall, who also has investments in rare coins, movies and horse racing, is reportedly facing financial difficulties. He had been involved in negotiations with other parties, including Sony Corp. of America, about selling a share of the Kings.

The new stadium, which would cost an estimated $125 million to $150 million, is planned to be a “full entertainment center,” where fans can watch the game, shop in retail stores or play interactive video games, said one source. It is also envisioned that the complex would include television production facilities.

“Sudikoff views this as an incredible opportunity for his company,” one source said. Cohen is a former executive of Madison Square Garden and, until Dec. 8, was on the board of SMG, a subsidiary of Spectacor. SMG manages the Los Angeles Memorial Coliseum and Sports Arena.

Sudikoff and Cohen are expected to transfer their stake in the new entity to IDB Communications after an undetermined time. It was unclear why IDB is not part of the deal from the outset, but the decision to invest was said to call for “quick, decisive action.”

Indeed, Sony was believed as late as Monday to still be in the running. The Kings would be a prized asset for Sony, which already owns Columbia Pictures and TriStar Pictures, and record label Sony Music.

IDB, based in Culver City, is a telecommunications operator best known for transmitting broadcast feeds and voice, data and video traffic on behalf of corporate clients.

Headed by the 38-year-old Sudikoff, the 10-year-old company is expected to post revenues of $300 million this year and profits should reach $22.7 million.

Under Sudikoff, IDB has pursued an aggressive strategy of the niche market in telecommunications services. After going public in 1986, IDB embarked on a series of acquisitions, increasing its revenue fivefold since 1989.

IDB made news in November when it raised $500 million after two of the company’s largest principals sold their shares in the open market.

By investing in the Kings, IDB would be following a strategy similar to that pursued by home video retail giant Blockbuster Entertainment, which was awarded the expansion baseball team Florida Marlins and Florida Panthers hockey team.

Blockbuster, which also acquired Spelling Entertainment and Republic Pictures, is seeking to become a broad-based company with interests spanning entertainment and sports.

Entertainment companies and sports franchises are believed to be key assets in the rapidly developing world of interactive television. And a stake in the Kings would give IDB a platform from which to launch other forays into entertainment, sports and retailing.

It was unclear whether IDB plans to use its technical facilities to start a cable TV channel that would telecast Kings games. The Kings signed a 20-year deal with Prime Ticket in 1988, but it could not be determined if that deal was renewable on an annual basis.

The proposed arena would seat about 20,000, some in luxury boxes, and would be modeled after the stadium under construction in Chicago for the NBA’s Chicago Bulls and NHL’s Black Hawks.

According to the sources, the principals would search for another location within the Los Angeles area if Buss does not agree to become part of the deal. They also would attempt to recruit other tenants, including the NBA’s Clippers, who are seeking an alternative to the Sports Arena.