A buyout of Danny Ferry’s contract with the Hawks was reached and approved Friday by the team’s board of managers, according to two people with knowledge of the negotiations. It will end the tenure of the general manager after he spent the past season on an indefinite leave of absence following racially insensitive remarks he made last June.
An official announcement will come in the next several days.
The move is the last of the ownership group known as the Atlanta Spirit, which is selling the Hawks and Philips Arena following a nearly year-long controversy that engulfed the franchise. A group led by Tony Ressler has reached agreement to buy the team for $730 million, a transaction that will be finalized Wednesday.
The buyout of Ferry’s contract will be the responsibility of the old ownership group. Ferry had two years remaining on the six-year, $18 million contract he signed in 2012. Ferry will receive substantially more than was due in the final two years of the deal.
The process of buying out Ferry began Wednesday when ownership members received notice of the meeting Friday to discuss the action, initiated by controlling owner Bruce Levenson and his Washington, D.C.-based partners. Negotiations were ongoing until a deal was reached and signed by Ferry in the early-morning hours Friday. The deal was approved by ownership at the 9 a.m. call hours later. Levenson and his partners own 50.1 percent of Hawks, clearing the way for approval.
The well-documented saga began in September when Levenson announced his intention to sell his share following the discovery of a 2012 email that contained racist remarks about the fan base and game operations. Later, the entire ownership group agreed to sell their stakes in the team.
Levenson’s email was discovered as part of an internal investigation following racially insensitive remarks Ferry made during a conference call with ownership and management last June. Ferry made comments about free-agent Luol Deng that were contained in a background report. A recording of the comments and the background report were obtained and released by The Atlanta Journal-Constitution.
The investigation was performed by the law firm Alston and Bird. The report found that Ferry should remain in his position but was to be disciplined, which included a fine. However, several days later Ferry asked for and was granted a leave of absence. He remained away from the team the entire season and watched as the roster he helped assemble produced a record-breaking season and advanced to the Eastern Conference finals.
Ferry has not spoken publicly since a statement announcing his leave. He has worked behind the scenes to clear his name and reputation. He received support from many around the NBA.
Coach Mike Budenholzer was placed in charge of basketball operations after Ferry’s leave. He reportedly will be named team president and head coach, and Wes Wilcox will be named general manager when the Ressler-led group assumes control next week.
