Friday, April 20, 2007

Web reports, ESPN and Earnhardts, oh my!

On the surface, it appears that this weekend’s "news" about the Dale Earnhardt Jr. contract talks is directly contradictory.
It started Thursday morning with a website called MaxChevy.com reporting that a 51 percent ownership stake in Dale Earnhardt Inc. for Earnhardt Jr. had "essentially been negotiated." Glen Grissom, a guy who’s been around racing for a long time and has a lot of good contacts, was behind that report.
Hours later, as it often does, ESPN pretended it invented the story by reporting in breathless terms at the top of its "NASCAR Now" show almost exactly what Grissom had – including the idea of a board of director-type structure set up for Earnhardt Jr. to "report" to.
ESPN did call DEI and talk to Max Siegel, the president of global operations there, to confirm that before taking the story and running with it. One of its online stories quoted a "source" in fleshing out details of the story, and it was fairly apparent that Siegel himself was that source.
Why, you might ask, did your faithful correspondent (in other words, me) not make the same phone calls. Well, it just so happened that on Thursday afternoon I was scheduled to go to Mooresville to see Kelley Elledge any way at the scrapbooking store she and Wendy Childers own up there.
I am working on a story for later this year about people in the sport with talents, interests and pursuits outside the sport, and the Scrap Shack is on that list. (By the way, if you’re ever in a position to bet on how many different shades of paper you can buy to put in a scrapbook, by all means take the over.)
As we wrapped that up, I asked Elledge if there was any news on the contract front. She said the sides were talking just about every day and there had been a lot of things talked about back and forth. So I drove back home and didn’t think much more about it.
Well, after catching the screaming headlines on "NASCAR Now" I tried to touch base with Elledge once again to make sure I hadn’t simply failed to ask the right question. She sent a reply to my e-mail inquiry early Friday morning, and that’s when I wrote a story saying that she said no formal offer for 51 percent ownership has been presented to her and, by extension, her brother.
So what’s the real story?
Well, I don’t think this is necessarily a case where anybody is off base with what is being reported.
Earnhardt Jr. has said he wants control of DEI. When he was pressed on what that means at Daytona’s media day in January, someone asked him if that meant 51 percent. Earnhardt Jr. said yes. In the weeks since, that number has sort of become the key fact in some minds.
If DEI has put forth some kind of proposal that offers Earnhardt Jr. 51 percent of the company’s assets, in terms of how it might add up on paper, I don’t think that necessarily equates to "control," and it’s control that he’s looking for.
Earnhardt Jr. knows that he’s going to be defined in his career by what he does on the track, and if he believes his team isn’t getting what it needs to compete at the sport’s highest level now he wants to change that so that he is ultimately judged on what he does to make sure he has a fair chance to reach his goals. If he falls short of expectations, that way he’d at least know he gave it everything he had.
Teresa Earnhardt, on the other hand, shouldn’t be expected to merely skip away happily after ceding control of a company she helped build. She’s smart, too, and she knows that in the court of public opinion if it appears Earnhardt Jr. has been offered what he’s asked for – that 51 percent number – and he says that’s not enough that the prevailing opinions about this whole soap opera might change.
If a board of directors is created to oversee the operation of the "new" DEI, how is that board constituted. Who’s on it and, more to the point, who gets to pick who’s on it? Answer that and you’ll answer who actually would have control of the company in such a setup.
DEI has been on the public relations defensive on this story since the first time Earnhardt Jr. spoke in January in response to the comments Teresa Earnhardt made in a Wall Street Journal story in December about her stepson needing to choose between being a NASCAR driver and a rock star.
Earnhardt Jr. and his sister have been calling the dance pretty much ever since then, using the leverage of Earnhardt Jr.’s popularity successfully to frame the reaction and discussion to this story in the garage as well as in the "NASCAR nation." What has happened in the past 48 hours, in my mind, is that DEI has tried to move that ball back toward midfield a little bit.
What’s really happening is that Max Siegel and Kelley Elledge are still talking about a new deal for Earnhardt Jr. Rest assured that both of them have plenty of smart people advising them along the way, too, and that include Teresa Earnhardt on the DEI said and Earnhardt Jr. himself on that side.
My belief, and it’s nothing really more than that, is that those talks have crossed a very critical point. I don’t think they’re talking any more about whether or not they can get a deal done, I think now they’re talking about how they can best get one done.
There’s a huge difference.

11 comments:

Anonymous said...

I wonder what Junior thinks of Max now. I believe that he was wary, took Max at face value and now has to be wondering exactly who the real Max is. Max works for Teresa. That's where his bread is buttered. So if Junior decides that Max is not to be trusted, this will play out very interestingly. Max should be careful. Even if he "wins" and gets what Teresa wants, they'll lose if they lose Junior. I'm starting to think that Teresa really doesn't care if Junior leaves or not. I hope I'm wrong but I really wonder where her head is sometimes.

Anonymous said...

Does ANYBODY really believe that Teresa gives a darn about Jr. and the race teams? I think she wants to dump the race teams and just make big money off of her dead husband's name. If anyone is in doubt of this, read Jayski. Teresa and Max have set up Earnhardt Entertainment Division. She has taken millions of DEI dollars and put it in an Entertainment Division to make movies and music!!!! Who really thinks that Dale Sr. would have taken money from his race teams, who are struggling a bit, and put it in an ENTERTAINMENT DIVISION????
She is biding her time until Dale Jr.'s deadline and then she'll probably come out with a story about how unreasonable Kelly and Dale Jr. are. DEI racing is on it's last legs. The greatest racer in NASCAR history(an opinion)-his legacy is going to be an ENTERTAINMENT COMPANY.

Anonymous said...

One more time, Teresa Houston Earnhardt could care less about what goes on on the track---IT is all about the money and licensing the "3" as long as she can milk it. With the sponsorship dollars she has had from Anheuser there is no reason Junior has not had Hendrick/Roush caliber equipment for the last 6 years. Did it ever occur to anyone that Junior stepping into the 5 car Sunday might have been a " try one of ours in real race conditions even if it is wrecked and see how it feels". Budweiser has been on the 25 before and I am sure that if Teresa and her token minority CEO don't give Kelley and Junior at least what they have earned by birthright, Rick won't have a problem in the world saying bye to Casey Mears. And oh by the way, Richard can't wait to put the 3 back in action with an Earnhardt in it. Junior deserves better than the treatment he is getting. JR Racing wouldn't have any problem being competitive with the help of others. Wake up and smell the Budweiser Teresa.

Anonymous said...

I never did believe the "news" that was announced at Texas that Jr. was offered 51%. And I never thought Jr. would leave DEI.

It is a "huge difference" that all parties are working on finding an agreement, and that is good news for this member of the Jr. Nation.

It also sounds like Kelley is doing much better. I think that's the best news I've heard all week.

Thanks for sharing David.

Shirley

Anonymous said...

DEI seemed to be doing fine until the insane swapping of Jr and Mikey's teams in 05. It destroyed Jr's year and nothing can help Mikey. Also, Jr said they had sent some engineers over to Truex's camp to help him win the championships. In this day they just can't take a year or so "off" like that.
INMHO Maxey has his own agenda and wants to get more minorities into Nascar instead of concentrating on what DEI needs. It's no surprise that entertainment is getting connected to DEI since that's what he knows best instead of racing.
Certainly someone needs to grab the DEI reins and get back to winning races before Jr leaves and takes Budweiser with him. Trust me, we fans don't care what company he drives for! OG

DBW said...

DEI has plenty of room to house a museum, recording and movie studios, as that appears as the direction it is headed. None of the long time Earnhardt fans I know, including myself, do not and will not blame Jr for looking out for his family, Kelly and Kerry. In fact, the longer this goes on, the more supportive fans are going to be when he moves on and does what is best for his family. Don't worry, Truex, Menard and the techncial brain trust of DEI won't let the door hit them on the way out, either!

Good luck making movies Theresa, as Earnhardt race fans are looking forward to JR the "Race Driver", not JR the "Rock Star"

BUDGIRL said...

Taylor Nicole is the only
Earnhardt Teresa cares about,
I think she never cared about
Big E other kids.The passion
of racing left her in 01>

Anonymous said...

Why should JR. need a contract to race for the company his father started for his children? Why did he have to fight Teresa for the rights to his own name?Why is Teresa bringing people in the company to start other divisions. The bottom line is MONEY for Taylor and to hell with Dale other children. I hope he leaves DEI, and goes to RCR. DEI will sink out business in less than a year. It is too bad Teresa doesn't have a good advisor or show her all the fans who will leave DEI if she persists in the craziness.

Anonymous said...

Wow. This is utterly unbelievable. I'm in shock.

ESPN actually confirmed a story?

They just must not have Jack Roush's phone number.

Anonymous said...

I don't think Dale Jr. or Kelley would consider Max a "token minority CEO" he appears to be qualified, and working hard to keep Dale Jr. at DEI. In fact, I think that if the decision was his, he would give Dale Jr. what he's asking for.

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