How the NBL owner brokered the deal to seal Bogut

The secret meeting that will change Australian basketball forever took place inside a luxury yacht at Melbourne’s Docklands.

Jeff Van Groningen, Kings Managing Director, Andrew Gaze, Kings Coach, Andrew Bogut, Larry Kestelman, NBL Owner and Jeremy Loeliger, NBL CEO this week

The date is April 10, 2018, and the secret meeting that will change Australian basketball forever is taking place inside a stationary luxury yacht moored at Pier 35 at Melbourne’s Docklands.

A fly on the wall would be struck by the almost comical contrast between the physical statures of the two men at the table, who present like something out of the movie Twins, starring Arnold Schwarzenegger and Danny de Vito.

On one side is a 1.7m Energizer bunny, who makes up for his lack of height with force of personality; on the other, an imposing 2.13m man mountain whose face is known in the lounge rooms of sports fans around the world.

The pair are Larry Kestelman, the 95 per cent-owner of the National Basketball League, and NBA basketball star Andrew Bogut, the man who for many years routinely topped the list of this country’s richest sporting stars.

They are aboard Kestelman’s $13 million, 37-metre yacht, colourfully named Vegas, which doubles as a mobile office and accommodation centre that the founder of Australian Internet service provider, Dodo, uses regularly for business and pleasure. The meeting moves quickly. Bogut puts his cards on the table, telling Kestelman: “I would love to play out my career in Australia.”

Kestelman is surprised by how rapidly Bogut reveals he wants to come home.

“We’d had chats before, but I wasn’t sure it would come to anything,” the straight-shooting Kestelman has told The Weekend Australian. “If you’d told me a few weeks ago that Andrew Bogut would join the NBL, I would have said it’s unlikely.”

So quickly does the conversation evolve that Bogut is soon workshopping with the Dodo founder which city he should play in. Bogut asks Kestelman: “Where can I make the most impact in the game?” Kestelman gives an opinion that sticks in Bogut’s mind when he makes his final decision a fortnight later: “I believe it’s Sydney. They need you more to help them fill their venue and to make a splash.”

The Bogut deal — which will see him take a 10 per cent ownership of the Kings after his two-year playing deal is done and with the option to buy more — could yet prove to be one of the most significant signings in Australian sport, breathing new life into a game on life support just three years ago.

In rebuilding the NBL, Kestelman has set his sights high. “I want an Australian version of the NBA,” he says boldly.

It is not just on the court that Kestelman wants to replicate the NBA. He is also aiming high with the business side of Australian basketball, hoping to make it profitable for the first time in decades.

Kestelman has also poached one of the NBA’s top commercial executives, Matt O’Brien of LeBron James’ Cleveland Cavaliers, to become its commercial director.

O’Brien has until now run the global corporate partnership development division of the Cavaliers. He says he is coming to Australia because it was an “incredibly exciting time” for the NBL: “The NBL is enjoying huge growth and is now rated among one of the best leagues in the world outside of the NBA.”

This week’s Bogut announcement has capped the biggest period of publicity for basketball in Australia since the halcyon days of the NBL in the 1990s.

A record seven Australians play for teams that made the current NBA playoffs, headed up by the man many believe could be a future NBA Hall of Famer, Ben Simmons, already widely compared to LA Lakers legend Magic Johnson.

Other Australians, including Aron Baynes, Joe Ingles, Matthew Dellavedova, Thon Maker and Patty Mills, have also made significant marks over the last few weeks in the NBA playoffs.

This combined talent has sports fans salivating at the prospect of the men’s Australian basketball team winning its first medal on the world stage, either at next year’s World Cup in China or in 2020 at the Tokyo Olympics.

Another factor exciting Kestelman is the prospect of two sold-out matches — with a cumulative crowd of 100,000 fans — between the resurgent Boomers and the US Dream Team at Etihad Stadium in August next year ahead of the World Cup.

The prospect of a team containing Simmons as the main playmaker, Mills and Ingles making three-point shots, and Bogut, Baynes and Dellavedova in defence, taking on the likes of James, Stephen Curry and Kevin Durant, excites the irrepressible Kestelman.

“The two matches at Etihad will be the biggest basketball matches ever staged in Australia,” he declares.

Kestelman is using the two matches as a key sweetener for his bid for a more lucrative rights deal for the NBL, after the current deal with Foxtel, SBS and the ABC expired in the season just passed.

Asked what he thought the latest rights to the NBL would fetch, Kestelman replies: “I don’t know what they’re worth. We just want the largest media companies to get behind us, work with us and back us to take it to the next level. They have spent a lot on other sports. I hope they’ve left a little bit behind for basketball.”

To try and maximise what he makes from the media rights, he has recruited the longstanding former AFL CEO, Andrew Demetriou, who has become the co-chairman of the advisory board of the NBL alongside Kestelman. Ex-Football Federation of Australia chief Ben Buckley, a former lieutenant of Demetriou at the AFL, who negotiated many of that sport’s key media rights deals, is also helping the NBL.

Demetriou has told The Weekend Australian Kestelman’s aim for the media rights to the sport is less about the size of what is paid for the rights, and more about gaining as much exposure as possible.

“It’s not necessarily only about more dollars,” Demetriou said. “If you can grow the game, the dollars will flow. It’s about getting as many eyeballs as possible on the game.”

Kestelman says the new-found profile for basketball in Australia is a far cry from where the game was three years ago. He only agreed to a 2015 proposition from the clubs for him to pump in $7 million to save the NBL, if club owners agreed to give him a controlling interest.

“I had taken over a business which had one sponsorship deal, with Wilson balls, and that was worth less than $100,000,” he recalls. “Our TV deal had expired, and there were no other sponsors. I was starting with a blank canvas.”

He vividly recalls a meeting at his company’s offices on Queens Road in Melbourne’s CBD on July 1, 2015, the first day of his ownership of the league, at which the NBL’s position was starkly underlined.

Present at the meeting were Jeremy Loeliger, who was rapidly appointed as the NBL’s new CEO, Kestelman’s son Justin, who was appointed head of marketing, and Guy Neville, who was appointed to run the day-to-day operations of the league. It was a young and inexperienced group with little experience in running a sport, but there was no time for procrastination — they had just three months before the new NBL season would be underway.

To focus his core group’s minds, Kestelman immediately implemented a 100-day plan to reboot the then-failing league. His first question to the group: “What do we need to do differently?”

“We’re in the business of entertainment,” he says now. “Having been to the NBA, it’s all about entertainment. As far as I’m concerned, we’re in the business of family entertainment — and we happen to play basketball in the middle of it.”

Kestelman said in the meeting he did not see sport as his only competition, but also events such as Disney on Ice.

“I believe every sport is in competition with everyone else,” he said. “The world has become smaller, and if you’re not uplifted — win, lose or draw — it’s not going to succeed. That’s what I wanted: the emotion. We looked at what the sport needed to look like. As a result, now there’s cheerleaders, fireworks, music, smoke machines, and high action for two hours.

“We also took it up a notch into a concert-like atmosphere. We have DJs, bands and artists at every game. It starts from the moment you come to the game. In Melbourne, we have a double decker bus, dancers and people shooting hoops.”

By the end of Kestelman’s impromptu 2015 meeting, no one present was under any illusion about what they had to do: save the NBL in 100 days.

“It was like the military — everyone had an action plan. We had 100 days to rebuild the business. The game in Australia had been just game of basketball, not entertainment. But we’re much more used to watching the NBA, which is all about entertainment.”

Three years on, the plan is paying dividends. Crowds have increased 50 per cent on their levels for the 2014-15 season before he took control. Stadiums of up to 13,000 people are regularly sold out in Melbourne, Perth and Adelaide. But a few years back, the Melbourne Tigers played out their final days inside of a few thousand spectators at Melbourne’s State Netball and Hockey Centre.

TV audiences are also now on the rise. Ratings on ESPN for the NBA in the current US season are up 30 per cent on last year, while cumulative average audiences for the latest NBL season rose by 40 per cent-plus, as interest in Australians in the NBA moves to a new level.

Corporate Australia is embracing the NBL again, with the sport’s sponsorship stable growing from one to 15 in three years. New names include Hungry Jacks, Qantas, Kmart, Chemist Warehouse and Australia Post.

But Australia’s biggest city has until now been the missing piece in the NBL puzzle, as Kestelman strives to find the right formula for success on and off the court.

When Kestelman took over the NBL, the Sydney Kings were a basket case, having barely played in the finals for many seasons. Kestelman’s first big move with the Kings in 2016 was to draft Andrew Gaze to take charge of them and put them on back on the map.

It is widely accepted in the NBL that a strong Kings means a strong NBL, and conversely, that the NBL cannot fully succeed without a strong Kings, as was the case when they were winning championships during the 1990s and early 2000s. The Kings have not yet had on-court results in their current incarnation, due to injuries and some questionable recruiting. But no one is questioning the team’s latest signing. Basketball pundits believe Bogut’s presence in Sydney, alongside of two former NBL MVPs, Jerome Randle and Kevin Lisch, and yesterday’s announcement the Kings are poaching Daniel Kickert from the Brisbane Bullets, could add up to one of the league’s best rosters yet.

Given that Sydney has by far the biggest stadium in the NBL with the 21,000-capacity Qudos Bank Arena in the city’s Olympic precinct, the team is likely to set a new NBL attendance record with an opening game blockbuster in October against Melbourne United.

But Kestelman insists Bogut is just the start of the NBL’s growth. He may be the first long-term NBA player to come back to the NBL, but Kestelman is determined Bogut will not be the last. “We have only just begun,” he says. “Andrew is I think the first of many. I’d love to see the day where we have multiple NBA players in the league, like Joe Ingles and Patty Mills.”

Kestelman’s passion has won over Demetriou, who says he is not being paid for his time and advice to the NBL.

“I just liked him. I liked his enthusiasm, his energy, and I appreciated he was doing it for the right reasons,” Demetriou says. “He just loves the game.”