Mon, Apr 5, 2021
By Jim Vassallo (Veri.bet Writer)
The sister of Dean Spanos, the controlling owner of the Los Angeles Chargers, has petitioned a court to put a portion of the organization for sale.
The petition was filed on Thursday, April 1, by Dea Spanos Berberian in Los Angeles County Superior Court. Berberian would like for at least one-third of the team to be put up for sale.
In the petition, Berberian stated that mounting debt has created a yearly loss for the family trust of an estimated $11 million.
The family trust has $353 million in debt and expenses as of September 30. Almost half of that ($164,778,931) is from the investment of the trust in the Los Angeles Chargers. The stake in the Chargers makes up 83% of the holdings in the trust.
"The trust is so heavily concentrated in owning a minority stake in a professional football team that beneficiaries have no choice but to depend almost solely on the rise or fall of the team," the petition says. "Maintaining the status quo is not an option."
A letter was included in the petition from Dean Spanos that stated he would hire an investment bank to help any of the family members who own a stake in the franchise sell it. Berberian claims in her petition that this would take that long.
"Every day that passes increases the risks that the charitable beneficiaries and the Spanos family legacy will suffer irreparable financial and reputational damage," the filing says.
The family members who own stakes in the franchise include Spanos, Berberian, Alexandra Spanos Ruhl, and Michael Spanos. Each of them owns 15% stakes in the team. The family trust owns 36% of the team and the last 4% is owned by non-family members.
When Alex and Faye Spanos died in 2018, Spanos and Berberian were named as co-trustees of the trust.
The Chargers were purchased by Alex Spanos in 1984. Dean took over managing the team in 1994.
A statement was issued by Dean Spanos, Michael Spanos, and Spanos Ruhl about the filing:
"Our parents, Alex and Faye, wanted the Chargers to be part of the Spanos Family for generations to come. For the three of us, the Chargers is one of our family's most important legacies, just as it was for our parents. Unfortunately, our sister Dea seems to have a different and misguided personal agenda," the statement said. "If Dea no longer wishes to be part of this family legacy, the three of us stand ready to purchase her share of the franchise, as our agreements give us the right to do."
The Chargers are valued at $2.6 billion in the latest rankings issued by Forbes. The share of the franchise for the trust could be worth as much as $850 million. The reason for such a high value is that it would be tied to how much Daniel Snyder spent to purchase the remaining 40.5% of his partner's minority stake in the Washington Football Team ($875 million).
The value of the organization is expected to increase with the new media rights deal announced in March by the NFL. The deal will bring in more than an estimated $10 billion per year starting in 2023.