OfficeMax, Office Depot agree to merger

Office Depot to buy Office Max as an attempt to compete with Staples.

Office Depot Inc. and Naperville-based OfficeMax Inc. confirmed Wednesday that they're planning to merge but left some key questions about the deal unanswered.

The all-stock deal calls for Office Depot to issue 2.69 new shares of common stock for each outstanding common share of OfficeMax. But officials declined to say where the newly merged company would be headquartered, who would sit in the CEO seat or even what it would be called.

OfficeMax CEO Ravi Saligram and Office Depot CEO Neil Austrian presented a united front during a Wednesday conference call with analysts, taking turns to explain the specifics of the deal.

"It takes two to tango," Saligram said. "Lo and behold, Neil and I have decided to tango."

The announcement of a merger, which Saligram said would "create a stronger, more global, more efficient competitor," put to rest years of speculation about a deal. The merger would unite the No. 2 company in the stationery and office supplies industry, Boca Raton, Fla.-based Office Depot, with the No. 3 company, OfficeMax, headquartered off Interstate 88.

A merger between the two chains "has made sense for years," Credit Suisse analyst Gary Balter wrote in a note this week.

Market leader Staples also would benefit from a merger, BB&T Capital Markets analyst Anthony Chukumba said.

"Clearly, you can't make this deal work unless you close a bunch of stores," he said. "Store rationalization is long overdue, and Staples will clearly benefit from just having fewer stores to compete with."

OfficeMax, with about 29,000 employees, operates 978 stores, including 10 in the Chicago area. Office Depot has about 39,000 employees and operates 1,675 stores, including seven in the Chicago area.

The two CEOs wouldn't say how many stores would be closed, but Balter has predicted about 600.

If the merger is completed, the company's board would have an equal number of directors chosen by Office Depot and OfficeMax. Based on Wednesday's stock closing price, the deal's value is about $976 million.

The combined company would have $18 billion in sales and achieve $400 million to $600 million in savings over three years, according to company officials.

Office Depot shareholders would own about 54 percent of the company and OfficeMax shareholders 46 percent.

It was not clear, though, whether those stockholders would be satisfied with the deal. One of OfficeMax's largest shareholders, Neuberger Berman, said this week that it would support a deal, depending on the terms.

The deal also is subject to approval by regulatory agencies, including the Federal Trade Commission.

Officials declined to say who would lead the combined business or where it would be located once the "merger of equals" is completed, likely by the end of the year.

"During the appropriate times ... our board will make the right decision," OfficeMax's Saligram said. "Now, we're independent companies, and we've got to go through lots of processes."

Saligram and Austrian will be considered to lead the company, but until a leader is chosen, they will remain in their positions.

"From the time we started talking, Ravi and I have grown very fond of each other. It's very clear we can work well together," Austrian said.

Their proposed partnership didn't begin well. The announcement of the planned merger was buried in an earnings release posted prematurely on the Office Depot website early in the morning, then quickly removed. The companies recovered, and about 8:30 a.m., they issued a joint statement announcing the proposed merger.

The mishap will likely be investigated by stock exchanges and regulatory organizations, according to a Chicago financial attorney.

"I am highly confident that the New York Stock Exchange, the Nasdaq and the Securities and Exchange Commission will be looking very closely at who pulled the trigger, who knew about this, and was this in good faith?" James McGurk said.

McGurk said he was not suggesting wrongdoing.

"When you think about it, you have two boards, lots of investment advisers, lawyers, and deals break down at the last minute. Are there lots of ways it could happen? Sure," he said.

OfficeMax shares closed Wednesday down 91 cents, or 7 percent, at $12.09. Shares of Office Depot closed down 84 cents, or nearly 17 percent, at $4.18.

Reuters contributed.

crshropshire@tribune.com

Twitter @corilyns

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Cops shoot suspect they say is wanted in string of heists

By Peter Nickeas




Tribune reporter

1:24 a.m. CST, February 20, 2013

Chicago police officers shot a man near a busy Bucktown neighborhood intersection after a pursuit that stemmed from an armed robbery at a Subway restaurant on the Near North Side, police said.

Police said the suspect is the same man wanted in more than a dozen robberies of North Side convenience stores and restaurants.

Police said the man shot tonight, about 11:50 p.m., fled from a Subway at 816 N. State Street and the pursuit ended when his SUV crashed into a car outside a Walgreens at 1601 N. Milwaukee Ave.

Police said the suspect did not respond to commands and made suspicious movements inside the vehicle before he was shot.

The other robberies police are investigating happened most often between 11:30 p.m. and 2:15 a.m.

Among the pair: two within hours of each other at 2200 N. Lincoln Avenue and 300 W. Chicago Avenue early in the morning of Feb. 6. 

It’s unclear if the man was shot inside or outside the vehicle and his condition is not known. He was taken to John H. Stroger Jr. Hospital of Cook County and is expected to survive, police said. 

Police from a number of nearby districts responded to the scene after officers called "10-1," a radio term used to signal an officer, firefighter or paramedic in distress. Detectives from two of the three city detective areas also responded to the scene.

Detectives approached people inside and out of the numerous bars that line the intersection asking if anyone saw anything. 

Traffic in the area, including CTA buses, is being rerouted through the neighboring side streets. 

 Check back for updates.

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Exclusive: Apple, Macs hit by hackers who targeted Facebook

BOSTON/SAN FRANCISCO (Reuters) - Apple Inc was recently attacked by hackers who infected Macintosh computers of some employees, the company said Tuesday in an unprecedented disclosure describing the widest known cyber attacks targeting Apple computers used by corporations.

Unknown hackers infected the computers of some Apple workers when they visited a website for software developers that had been infected with malicious software. The malware had been designed to attack Mac computers.

The same software, which infected Macs by exploiting a flaw in a version of Oracle Corp's Java software used as a plug-in on Web browsers, was used to launch attacks against Facebook, which the social network disclosed on Friday.

The malware was also employed in attacks against Mac computers used by "other companies," Apple said, without elaborating on the scale of the assault.

Twitter, which disclosed that it had been breached February 1 and that hackers might gave accessed some information on about 250,000 users, was hit in the same campaign, according to a person close to the investigation.

Another person briefed on the case said that hundreds of companies, including defense contractors, had been infected with the same malicious software. Though this person said that the malware could have originated from China, there was no proof.

"This is a new campaign. It's not like the other ones you read about where everyone can tell it's China," the first person said.

Investigations into the breaches are ongoing. It was not immediately clear when the attacks had begun, the extent to which the hackers had succeeded in stealing data from targeted systems, or whether all infected machines have been identified.

The malware was distributed at least in part through a site aimed at iPhone developers, which might still be infecting visitors who haven't disabled Java in their browser, the person close to the case said. There is a version that infects computers running Microsoft Windows as well.

Security firm F-Secure wrote that the attackers might have been trying to get access to the code for apps on smartphones, seeking a way to infect millions of end-users. It urged developers to check their source code for unintended changes.

Apple disclosed the breach as tensions are heating up over U.S. allegations that the Chinese military engages in cyber espionage on U.S. companies.

U.S. cyber security firm Mandiant reported over the weekend that it has uncovered evidence that the Chinese military is behind a slew of cyber attacks on U.S. businesses. The White House said it has repeatedly raised concerns about Chinese cyber theft with Beijing.

The breaches described by Apple mark the highest-profile cyber attacks to date on businesses running Mac computers. Hackers have traditionally focused on attacking machines running the Windows operating system, though they have gradually turned their attention to Apple products over the past couple of years as the company gained market share over Microsoft Corp.

"This is the first really big attack on Macs," said the source, who declined to be identified because the person was not authorized to discuss the matter publicly. "Apple has more on its hands than the attack on itself."

Charlie Miller, a prominent expert on Apple security who is co-author of the Mac Hacker's Handbook, said the attacks show that criminal hackers are investing more time studying the Mac OS X operating system so they can attack Apple computers.

For example, he noted, hackers recently figured out a fairly sophisticated way to attack Macs by exploiting a flaw in Adobe Systems Inc's Flash software.

"The only thing that was making it safe before is that nobody bothered to attack it. That goes away if somebody bothers to attack it," Miller said.

NATIONAL SECURITY

Cyber security attacks have been on the rise. In last week's State of the Union address, U.S. President Barack Obama issued an executive order seeking better protection of the country's critical infrastructure from cyber attacks.

White House spokesman Jay Carney told reporters on Tuesday that the Obama administration has repeatedly taken up its concerns about Chinese cyber theft with Beijing, including the country's military. There was no indication as to whether the group described by Mandiant was involved in the attacks described by Apple and Facebook.

An Apple spokesman declined to specify how many companies had been breached in the campaign targeting Macs, saying he could not elaborate further on the statement it provided.

"Apple has identified malware which infected a limited number of Mac systems through a vulnerability in the Java plug-in for browsers. The malware was employed in an attack against Apple and other companies, and was spread through a website for software developers," the statement said.

"We identified a small number of systems within Apple that were infected and isolated them from our network. There is no evidence that any data left Apple," it continued.

The statement said Apple was working closely with law enforcement to find the culprits, but the spokesman would not elaborate. The Federal Bureau of Investigation declined to comment.

Apple said it plans to release a piece of software on Tuesday that customers can use to identify and repair Macs infected with the malware used in the attacks.

(Editing by Andre Grenon, Edwin Chan and Richard Chang)

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No. 1 Indiana beats No. 4 Michigan State 72-68

EAST LANSING, Mich. (AP) — Victor Oladipo shook off a sprained left ankle with a spectacular performance to lift top-ranked Indiana to a 72-68 win over No. 4 Michigan State on Tuesday night.

Oladipo's go-ahead putback, dunk and free throws in the final minute gave him 19 points to go along with nine rebounds, five steals and a block. Not bad for a guy who didn't play after halftime of his previous game, just three days earlier, because of the injury.

Hoosiers coach Tom Crean insisted that the junior shooting guard "wasn't even close" to 100-percent healthy.

"There's no doubt his foot hurt," Crean said. "That mind was right, and that was the biggest thing."

Indiana (24-3, 12-2 Big Ten) broke a first-place tie in the conference — with four games left in the regular season — and moved a step closer toward earning top seeding next month in the NCAA tournament.

"It was a huge win for us," Oladipo said. "We've come a long way."

The Hoosiers had lost 17 straight — since 1991 — on the road against the Spartans.

"Most of those guys weren't alive," Crean said. "It didn't affect them."

Michigan State (22-5, 11-3) blew opportunities at the line.

Trailing by three with 3.7 seconds left, Harris was fouled on a 3-point attempt. He missed the first one — setting off sighs in the sold-out arena — and after making the second, he deliberately missed the third.

Indiana got the rebound — Oladipo grabbed it, of course — and he hit two free throws to seal the win.

"We were right there," Gary Harris said somberly. "And, we could've won."

Keith Appling had missed the front end of a one and one with a little more than a minute left.

"I'd say I was more upset than surprised," he said.

Cody Zeller had 17 points — nearly doubling what he had in the previous matchup against Michigan State — while Jordan Hulls and Christian Watford scored 12 each for the Hoosiers.

Oladipo and Zeller went over the 1,000-point mark of their careers in the game, joining Hulls and Watford in the club, to give the storied program four players with that many points on the same team for the first time.

"They've got a lot of weapons," Izzo said. "They've got a lot of experience."

Harris, Indiana's Mr. Basketball last year, missed a layup in a crowded lane with 16 seconds left and finished with 19 points. Adreian Payne scored 17 and the rest of their teammates struggled offensively.

Appling, Michigan State's leading scorer, was held to six points on 1-of-8 shooting.

"My quarterback struggled a little bit," Izzo said.

Branden Dawson had eight points and Derrick Nix scored eight and some of his contributions offensively late in the game looked like they were going to help the school win its second game in the regular season against a No. 1 team.

Nix made a go-ahead shot — after grabbing rebounds off two of his misses — to put Michigan State ahead 64-63 lead with 3:08 left and scored again in the post on its next possession.

Harris made one of two free throws with 1:38 remaining to give the Spartans a game-high, four-point lead.

Watford responded with a three-point play on the ensuing possession to pull Indiana within a point and Oladipo did the rest.

Michigan State had won five straight and 11 of 12 with its only loss during the stretch at Indiana. In last month's five-point loss at Indiana, Oladipo had 21 points, seven rebounds, six steals and three blocks.

The rematch marked the first time two top-five teams have met at the Breslin Center.

It was the third matchup of top-four teams in college basketball this season — the second for Indiana, which beat then top-ranked Michigan — and was just the fourth with a pair of Big Ten teams since 1997.

"Nothing rattles us too much," Zeller said.

The highly anticipated and hyped game lived up to the billing with end-to-end action, scrambles for loose balls, 3-point shots, blocks in the lane and plenty of physical play.

And, a banged-up Oladipo was the star of the showdown.

"Oladipo is just a refuse-to-lose guy," Izzo said. "Winning time, he made the plays."

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Follow Larry Lage on Twitter: http://twitter.com/larrylage

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Drug overdose deaths up for 11th consecutive year

CHICAGO (AP) — Drug overdose deaths rose for the 11th straight year, federal data show, and most of them were accidents involving addictive painkillers despite growing attention to risks from these medicines.

"The big picture is that this is a big problem that has gotten much worse quickly," said Dr. Thomas Frieden, head of the Centers for Disease Control and Prevention, which gathered and analyzed the data.

In 2010, the CDC reported, there were 38,329 drug overdose deaths nationwide. Medicines, mostly prescription drugs, were involved in nearly 60 percent of overdose deaths that year, overshadowing deaths from illicit narcotics.

The report appears in Tuesday's Journal of the American Medical Association.

It details which drugs were at play in most of the fatalities. As in previous recent years, opioid drugs — which include OxyContin and Vicodin — were the biggest problem, contributing to 3 out of 4 medication overdose deaths.

Frieden said many doctors and patients don't realize how addictive these drugs can be, and that they're too often prescribed for pain that can be managed with less risky drugs.

They're useful for cancer, "but if you've got terrible back pain or terrible migraines," using these addictive drugs can be dangerous, he said.

Medication-related deaths accounted for 22,134 of the drug overdose deaths in 2010.

Anti-anxiety drugs including Valium were among common causes of medication-related deaths, involved in almost 30 percent of them. Among the medication-related deaths, 17 percent were suicides.

The report's data came from death certificates, which aren't always clear on whether a death was a suicide or a tragic attempt at getting high. But it does seem like most serious painkiller overdoses were accidental, said Dr. Rich Zane, chair of emergency medicine at the University of Colorado School of Medicine.

The study's findings are no surprise, he added. "The results are consistent with what we experience" in ERs, he said, adding that the statistics no doubt have gotten worse since 2010.

Some experts believe these deaths will level off. "Right now, there's a general belief that because these are pharmaceutical drugs, they're safer than street drugs like heroin," said Don Des Jarlais, director of the chemical dependency institute at New York City's Beth Israel Medical Center.

"But at some point, people using these drugs are going to become more aware of the dangers," he said.

Frieden said the data show a need for more prescription drug monitoring programs at the state level, and more laws shutting down "pill mills" — doctor offices and pharmacies that over-prescribe addictive medicines.

Last month, a federal panel of drug safety specialists recommended that Vicodin and dozens of other medicines be subjected to the same restrictions as other narcotic drugs like oxycodone and morphine. Meanwhile, more and more hospitals have been establishing tougher restrictions on painkiller prescriptions and refills.

One example: The University of Colorado Hospital in Aurora is considering a rule that would ban emergency doctors from prescribing more medicine for patients who say they lost their pain meds, Zane said.

___

Stobbe reported from Atlanta.

___

Online:

JAMA: http://www.jama.ama-assn.org

CDC: http://www.cdc.gov

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AP Medical Writer Lindsey Tanner can be reached at http://www.twitter.com

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Police say NY TV anchor threatened wife with death

A New York City TV anchorman issued a death threat against his wife as he was being arrested on charges of attacking her at their Connecticut home, according to a court document released Tuesday.

New York City police, meanwhile, disclosed that they were called 11 times to the couple's home when they lived in Manhattan. One call resulted in an arrest, but the case was sealed, they said.

In the Connecticut case, a Darien police officer wrote that Rob Morrison, who works for WCBS-TV, "threatened that if he was released from police custody, he would kill his wife."

The document was offered in Superior Court in Stamford, in support of an order of protection against Morrison. Judge Kenneth Povadator ordered Morrison to stay 100 yards away from Ashley Morrison except when they're both at work.

She works for "CBS Moneywatch."

Rob Morrison, 44, was charged Sunday with strangulation, threatening and disorderly conduct. Officers had been called by his mother-in-law to the couple's home in Darien. They said Morrison had been belligerent toward his wife throughout the night and had wrapped his hands around her neck, leaving red marks.

Morrison's lawyer, Robert Skovgaard, did not enter a plea at the arraignment. He said afterward a plea would come "at the appropriate time."

Skovgaard said Monday that the allegations had been exaggerated and on Tuesday he referred to his previous statement.

Outside the courthouse, Morrison said: "I did not choke my wife. I've never raised my hands to my wife."

The NYPD said it was called 11 times between 2004 and 2009 to the couple's home on West 90th Street. In the 10 cases that did not result in an arrest, the calls involved verbal disputes and harassment, with no allegations of physical violence, the police said.

It was not clear if violence was alleged in the case that was sealed. Skovgaard did not immediately return a call about the New York incidents.

Morrison was released Tuesday on the $100,000 bond he posted Sunday. He is due back in court in Stamford on March 26.

Morrison, who has been a combat correspondent and was a reporter and anchor for WNBC-TV, anchors WCBS-TV's news programs "This Morning" and "News at Noon." Ashley Morrison worked for Bloomberg Television before joining "CBS MoneyWatch."

The couple has a young son.

Skovgaard said that because of the order of protection, Morrison "will not be going home tonight."

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Associated Press writer Colleen Long in New York contributed to this report.

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OfficeMax, Office Depot shares soar on merger talk

Shares of OfficeMax Inc. skyrocketed 21 percent Tuesday on speculation that the Naperville-based office supply retailer is in talks to merge with rival Office Depot Inc.

In the first day of trading after news of a potential deal was reported, OfficeMax shares closed up $2.25, at $13, while Boca Raton, Fla.-based Office Depot stock gained more than 9 percent, closing at $5.02. Archrival and market leader Staples' shares picked up more than 13 percent, closing at $14.65.

Neither OfficeMax nor Office Depot representatives are talking, but observers predict a deal as early as this week.

A marriage between the two is seen a natural progression in a crowded industry facing increased competition from forces such as Internet giant Amazon.com and the likes of big discounters such as Wal-Mart and Costco.

Not long ago, bets were that Staples might link up with OfficeMax. More recently, there was speculation that Office Depot and OfficeMax would team up to compete against Staples.

A merger would initially bump the combined companies ahead of Staples in store count. Together, OfficeMax and Office Depot operate about 2,653 stores, although analysts predict that at least 600 would be shuttered. Staples, which is based in Framingham, Mass., operates about 2,300.

Analysts say that Office Depot and OfficeMax have long lists of good customers and when put together could improve operating efficiencies and, therefore, profit.

"The basic challenge that both companies face is that they play in such a competitive space that they are forever locked in a battle to gain market share," said Tim Calkins, clinical professor of marketing at Northwestern University's Kellogg School of Management. "The truth is, when you have that much competition, it's very hard to maintain good margins; there's just relentless pressure."

Both chains have been working to reduce costs, closing underperforming stores and moving into smaller locations, but even if they team up, some analysts still give Staples the edge.

"We think there are a lot of things that Staples is doing better, that even after (Office Depot and OfficeMax) combine, they might not be able to match Staples immediately and maybe not ever," said Morningstar analyst Liang Feng.

OfficeMax is a little more than a year into a major turnaround plan led by CEO Ravi Saligram, an engineer by training who worked at Leo Burnett and was a top executive at Aramark International before he was tapped to lead OfficeMax in 2010. Saligram is largely credited with leading the company's improved performance last year, with its stock price climbing 99.6 percent, from a low of $4.89 to a high of $9.76, though sales in stores open at least a year remained flat.

Like many retailers faced with competition from the Internet, OfficeMax has aimed to shrink and become more nimble.

"We're beginning to gain some momentum," Saligram told the Tribune in a December interview. "It's a journey, but we'll do it very deliberately."

Industry analysts agree that Saligram's strategy is gaining traction. Credit Suisse analyst Gary Balter predicted Saligram likely would be tapped to lead the combined business.

Saligram said the company has focused on a "three-pronged" approach that began in late 2011 and included turning around the company's core business and continuing to boost its online business and shrink store size.

That included plans to cut 5 million square feet of space, expand product offerings to include janitorial and sanitation supplies, and court the small-business customer in its bricks-and-mortar stores.

"We are obsessed with the small-business customer," Saligram said. "That's our core."

The problem with that approach, according to Feng, is that while small-business customers are most profitable for office suppliers, they are also the most fickle.

That strategy also isn't far from Staples'.

For consumers, little would change after a merger, analysts say. Competition is so fierce for the office supply industry that the threat of higher prices is next to nothing.

But a marriage would help in one regard: Consumers likely struggle to distinguish between the two suppliers, Calkins said.

"The brands are so similar, it's hard for anyone to keep them straight," he said.

The Wall Street Journal reported Monday that the two companies were in advanced merger talks.

OfficeMax reports fourth-quarter earnings Thursday.

Wall Street is expecting sales to decline to $1.75 billion and adjusted earnings per share to drop to 27 cents per share.

crshropshire@tribune.com

Twitter @corilyns

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Rose returns to 5-on-5 drills for first time since injury

A sense of doubt has evolved into a hint of optimism about Derrick Rose's comeback from knee surgery.

The Bulls guard, who last week mentioned the possibility of sitting out the season, appeared to take another step Monday as he participated in 5-on-5 drills during practice.

"He was able to get out there, and it's good," teammate Kirk Hinrich said. "It was something that (we) as a team needed, as far as every individual coming off the (All-Star) break needed to scrimmage a little bit. And I'm sure it was good for (Rose), helpful to ... give him a good gauge of where he's at."

Coach Tom Thibodeau said Rose did "what everyone else did'' and said his participation wasn't out of the ordinary based on the previously stated outlook. The plan all along was to have Rose return to 5-on-5 action after the break.

Rose cited his inability to dunk as the reason he knew he hadn't fully recovered, and Joakim Noah said Rose still wasn't dunking Monday. The Bulls went through three scrimmages of seven to eight minutes, during which Rose ran full-court. It was unclear how much contact Rose endured or how much pressure he put on his left knee.

"He's doing what he should be doing,'' Thibodeau said. "He's focused on his rehab, doing more and more. We just have to be patient. When he's ready, he'll go.''

Thibodeau reiterated how his players need to pick up their intensity after dropping five of the last seven games and six of the last 10. A Rose return would instantly inject life into the 30-22 Bulls, although they've performed admirably at times in his absence while currently holding the Eastern Conference's fifth seed.

Until Rose steps on the court for a game, his teammates have to lean on each other.

"When we're right and we're playing the right way, we've proved that we can beat everybody,'' Noah said. "We've also proved that if we don't come with the right (attitude), don't play together, we can lose to anybody.''

The return of Hinrich to the lineup for Tuesday night's game in New Orleans should provide a boost. The Bulls went 2-5 with Hinrich sidelined by a right elbow infection and committed 15.6 turnovers per game in the losses.

With all due respect to Nate Robinson and his scoring ability, Hinrich runs the offense more efficiently and is a better defender.

"He's a huge part of what we do, and it just feels good to have Kirk back,'' Noah said. "What he brings to our team, it's hard to measure. His defensive intensity, the ball movement ... it's all big.''

The Bulls have lost two straight and take on a 19-34 Hornets team that has won its last two and is 5-5 over the last 10. Four of the Bulls' next six opponents have sub-.500 records, but the Heat (36-14) and Thunder (39-14) are in that stretch too.

"We have to clean some things up offensively and defensively,'' Thibodeau said. "But the biggest challenge is going to be the level of intensity, to get that back.''

vxmcclure@tribune.com

Twitter @vxmcclure23

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Burger King takes down Twitter account after hack attack

NEW YORK (Reuters) - Hackers breached the Twitter account of fast-food chain Burger King, posting the online equivalent of graffiti and sometimes making little sense.

Burger King Worldwide Inc suspended its Twitter account about an hour after it learned of the attack at 12:24 p.m. EST on Monday, company spokesman Bryson Thornton said in an email.

"It has come to our attention that the Twitter account of the BURGER KING® brand has been hacked," the company said in a statement. "We have worked directly with administrators to suspend the account until we are able to re-establish our legitimate site and authentic postings."

Several tweets carried the logo of Burger King's larger rival McDonald's, but spelled the latter company's name incorrectly. Others sought to tarnish Burger King, the third-largest U.S. hamburger chain, and its employees.

"Just got sold to McDonalds," one tweet said, adding "FREDOM IS FAILURE".

(Reporting by Ilaina Jonas; Editing by Dale Hudson)

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Jerry Buss, Lakers' flamboyant owner, dies at 80

Jerry Buss built a glittering life at the intersection of sports and Hollywood.

After growing up in poverty in Wyoming, he earned success in academia, aerospace and real estate before discovering his favorite vocation when he bought the Los Angeles Lakers in 1979. While Buss wrote the checks and fostered partnerships with two generations of basketball greats, the Lakers won 10 NBA titles and became a glamorous global brand.

With a scientist's analytical skills, a playboy's flair, a businessman's money-making savvy and a die-hard hoops fan's heart, Buss fashioned the Lakers into a remarkable sports entity. They became a nightly happening, often defined by just one word coined by Buss: Showtime.

"His impact is felt worldwide," said Kobe Bryant, who has spent nearly half his life working for Buss.

Buss, who shepherded his NBA team from the Showtime dynasty of the 1980s to the current Bryant era while becoming one of the most important and successful owners in pro sports, died Monday. He was 80.

"Think about the impact that he's had on the game and the decisions he's made, and the brand of basketball he brought here with Showtime and the impact that had on the sport as a whole," Bryant said a few days ago. "Those vibrations were felt to a kid all the way in Italy who was 6 years old, before basketball was even global."

Under Buss' leadership, the star-studded, trophy-winning Lakers became Southern California's most beloved sports franchise and a signature cultural representation of Los Angeles. Buss acquired, nurtured and befriended a staggering array of talented players and basketball minds during his Hall of Fame tenure, from Magic Johnson, Kareem Abdul-Jabbar and James Worthy to Bryant, Shaquille O'Neal and Dwight Howard.

Few owners in sports history can approach Buss' accomplishments with the Lakers, who made the NBA Finals 16 times during his nearly 34 years in charge, winning 10 titles between 1980 and 2010. Whatever the Lakers did under Buss' watch, they did it big — with marquee players, eye-popping style and a relentless pursuit of success with little regard to its financial cost.

"His incredible commitment and desire to build a championship-caliber team that could sustain success over a long period of time has been unmatched," said Jerry West, Buss' longtime general manager and now a consultant with the Golden State Warriors. "With all of his achievements, Jerry was without a doubt one of the most humble men I've ever been around. His vision was second to none; he wanted an NBA franchise brand that represented the very best and went to every extreme to accomplish his goals."

Buss died at Cedars-Sinai Medical Center in Los Angeles, said Bob Steiner, his assistant and longtime friend. Buss had been hospitalized for most of the past 18 months while undergoing cancer treatment, but the cause of death was kidney failure, Steiner said.

"When someone as celebrated and charismatic as Jerry Buss dies, we are reminded of two things," said Abdul-Jabbar, the leading scorer in NBA history. "First, just how much one person with vision and strength of will can accomplish. Second, how fragile each of us is, regardless of how powerful we were. Those two things combine to inspire us to reach for the stars, but also to remain with our feet firmly on the ground among our loved ones. ... The man may be gone, but he has made us all better people for knowing him."

With his condition worsening in recent months, several prominent former Lakers visited Buss to say goodbye. Even rivals such as Dallas Mavericks owner Mark Cuban and Clippers owner Donald Sterling hailed the passion and bonhomie of the former chemist and mathematician who lived his own Hollywood dream.

"He was a great man and an incredible friend," Johnson tweeted.

Buss always referred to the Lakers as his extended family, and his players rewarded his fanlike excitement with devotion, friendship and two hands full of championship rings. Working with front-office executives West, Bill Sharman and Mitch Kupchak, Buss spent lavishly to win his titles despite lacking a huge personal fortune, often running the NBA's highest payroll while also paying high-profile coaches Pat Riley and Phil Jackson.

"Jerry Buss was more than just an owner. He was one of the great innovators that any sport has ever encountered," Riley said. "He was a true visionary, and it was obvious with the Lakers in the 80's that 'Showtime' was more than just Magic Johnson and Kareem Abdul-Jabbar. It was really the vision of a man who saw something that connected with a community."

Ownership of the Lakers is now in a trust controlled by Buss' six children, who all have worked for the Lakers in various capacities for several years. With 1,786 victories, the Lakers easily are the NBA's winningest franchise since he bought the club, which is now run largely by Jim Buss and Jeanie Buss.

"We not only have lost our cherished father, but a beloved man of our community and a person respected by the world basketball community," the Buss family said in a statement issued by the Lakers.

"It was our father's often-stated desire and expectation that the Lakers remain in the Buss family. The Lakers have been our lives as well, and we will honor his wish and do everything in our power to continue his unparalleled legacy."

Johnson and fellow Hall of Famers Abdul-Jabbar and Worthy formed lifelong bonds with Buss during the Lakers' run to five titles in nine years in the 1980s, when the Lakers earned a reputation as basketball's most exciting team with their flamboyant Showtime repartee.

The buzz extended throughout the Forum, where Buss turned the Lakers' games into a must-see event. He used the Laker Girls, a brass band and promotions to keep Lakers fans interested during all four quarters. Courtside seats, priced at $15 when he bought the Lakers, became the hottest tickets in Hollywood — and they still are, with fixture Jack Nicholson and many other celebrities attending every home game.

"Anybody associated with the NBA since 1980 benefited greatly from Jerry Buss' impact on the game," Steiner said. "He had a different way of looking at things than I did, and people who had been raised in basketball."

Buss paid the Lakers' bills through both their wild success and his groundbreaking moves to raise revenue. He co-founded a basic-cable sports television network and sold the naming rights to the Forum at times when both now-standard strategies were unusual, further justifying his induction to the Naismith Memorial Basketball Hall of Fame in 2010.

"The NBA has lost a visionary owner whose influence on our league is incalculable and will be felt for decades to come," NBA Commissioner David Stern said. "More importantly, we have lost a dear and valued friend."

Showtime couldn't last forever, but after a rough stretch in the 1990s, Buss rekindled the Lakers' mystique by paying top dollar to hire Jackson, who led O'Neal and Bryant to a three-peat from 2000-02. Bryant and Pau Gasol won two more titles under Jackson in 2009 and 2010.

The current Lakers (25-29) have struggled mightily despite adding Howard and Steve Nash in a couple of moves that were typical of Buss' big, brash style. Los Angeles could miss the playoffs this spring for just the third time since Buss bought the franchise.

"Today is a very sad day for all the Lakers and basketball," Gasol tweeted. "All my support and condolences to the Buss family. Rest in peace Dr. Buss."

Although Buss gained fame and another fortune with the Lakers, he also was a scholar, Renaissance man and bon vivant who epitomized California cool his entire public life.

Buss rarely appeared in public without at least one attractive, much younger woman on his arm — at Southern California football games, high-stakes poker tournaments, hundreds of boxing matches promoted by Buss at the Forum — and, of course, Lakers games from his private box at Staples Center, which was built under his watch. With his failing health, Buss hadn't attended a Lakers game in the past two seasons.

After a rough-and-tumble childhood that included stints as a ditch-digger and a bellhop in the frigid Wyoming winters, Buss earned a Ph.D. in chemistry from USC at age 24, and had careers in aerospace and real estate development before getting into sports. With money from his real-estate ventures and a good bit of creative accounting, Buss bought the then-struggling Lakers, the NHL's Los Angeles Kings and both clubs' arena — the Forum — from Jack Kent Cooke in a $67.5 million deal that was the largest sports transaction in history at the time.

Last month, Forbes estimated the Lakers were worth $1 billion, second most in the NBA.

Buss also helped change televised sports by co-founding the Prime Ticket network in 1985, and he received a star on the Hollywood Walk of Fame in 2006 for his work in television. Breaking the contemporary model of subscription services for televised sports, Buss' Prime Ticket put beloved broadcaster Chick Hearn and the Lakers' home games on basic cable.

Buss also sold the naming rights to the Forum in 1988 to Great Western Savings & Loan — another deal that was ahead of its time.

Born in Salt Lake City, Gerald Hatten Buss was raised in poverty in Wyoming before improving his life through education. He also grew to love basketball, describing himself as an "overly competitive but underly endowed player."

After graduating from the University of Wyoming, Buss attended USC for graduate school because he loved its sports teams. He also became a chemistry professor and worked in the missile division of defense contractor McDonnell Douglas before carving out a path to wealth and sports prominence.

His real-estate portfolio grew out of a $1,000 investment in a West Los Angeles apartment building with partner Frank Mariani, an aerospace engineer and co-worker.

Heavily leveraging his fortune and various real-estate holdings during two years of negotiations, Buss purchased Cooke's entire Los Angeles sports empire along with a 13,000-acre ranch in Kern County. Buss immediately worked to transform the Lakers — who had won just one NBA title since moving west from Minneapolis in 1960 — into a star-powered endeavor befitting Hollywood.

"One of the first things I tried to do when I bought the team was to make it an identification for this city, like Motown in Detroit," he told the Los Angeles Times in 2008. "I try to keep that identification alive. I'm a real Angeleno. I want us to be part of the community."

With showmanship, fearless spending and a little drafting luck, Buss quickly succeeded: Johnson, Abdul-Jabbar and coach Paul Westhead led the Lakers to the 1980 title. Johnson's ball-handling wizardry and Abdul-Jabbar's smooth inside game made for an attractive style of play, and the Lakers came to define West Coast sophistication.

Riley, the former broadcaster who fit the L.A. image perfectly with his slick-backed hair and good looks, was surprisingly promoted by Buss early in the 1981-82 season. He became one of the best coaches in NBA history, leading the Lakers to four straight NBA finals and four titles, with Worthy, Michael Cooper, Byron Scott and A.C. Green playing major roles.

"I was privileged to be part of that for 10 years and even more grateful for the friendship that has lasted all these many years," Riley said. "I have always come to realize that if it weren't for Dr. Buss, I wouldn't be where I am today."

Overall, the Lakers made the Finals nine times in Buss' first 12 seasons while rekindling the NBA's best rivalry with the Boston Celtics, and Buss basked in the worldwide celebrity he received from his team's achievements. His partying became the stuff of Los Angeles legends, with even his players struggling to keep up with Buss' lifestyle.

Johnson's HIV diagnosis and retirement in 1991 staggered Buss and the Lakers, the owner recalled in 2011. The Lakers went through seven coaches and made just one conference finals appearance in an eight-year stretch of the 1990s despite the 1996 arrivals of O'Neal, who signed with Los Angeles as a free agent, and Bryant, the 17-year-old high schooler acquired in a draft-week trade.

Shaq and Kobe didn't reach their potential until Buss persuaded Jackson, the Chicago Bulls' six-time NBA champion coach, to take over the Lakers in 1999. Los Angeles immediately won the next three NBA titles in brand-new Staples Center, AEG's state-of-the-art downtown arena built with the Lakers as the primary tenant.

After the Lakers traded O'Neal in 2004, they hovered in mediocrity again until acquiring Gasol in a heist of a trade with Memphis in early 2008. Los Angeles made the next three NBA Finals, winning two more titles.

Through the Lakers' frequent successes and occasional struggles, Buss never stopped living his Hollywood dream. He was an avid poker player and a fixture on the Los Angeles club scene well into his 70s, when a late-night drunk-driving arrest in 2007 — with a 23-year-old woman in the passenger seat of his Mercedes-Benz — prompted him to cut down on his partying.

Buss owned the NHL's Kings from 1979-87, and the WNBA's Los Angeles Sparks won two league titles under Buss' ownership. He also owned Los Angeles franchises in World Team Tennis and the Major Indoor Soccer League.

Buss' children have pledged to continue his commitment to the Lakers' distinctive success, although their efforts haven't been rewarded in the past three years while Jerry Buss ceded many decision-making responsibilities to Jim Buss, the Lakers' executive vice president of player personnel and the second-oldest child. While daughter Jeanie runs the franchise's business side, Jim Buss now has the final say on basketball decisions.

Jerry Buss still served two terms as president of the NBA's Board of Governors and was actively involved in the 2011 lockout negotiations, developing blood clots in his legs attributed to his extensive travel during that time.

"I am blessed with a wonderful family who have helped me and guided me every step of the way," Buss said in 2010 at his Hall of Fame induction ceremony. "This support is the best anybody could ever have."

Buss is survived by his six children: sons Johnny, Jim, Joey and Jesse, and daughters Jeanie Buss and Janie Drexel. He had eight grandchildren.

Arrangements are pending for a funeral and memorial service, likely at Staples Center or a nearby theatre in downtown Los Angeles.

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Associated Press writers Beth Harris and Andrew Dalton contributed to this report.

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