By Larry Fine
NEW YORK (Reuters) - The NBA will lock out its players at midnight on Thursday as last-ditch negotiations over a new labor deal collapsed hours before the current agreement expires, the league and union representing its players said.
Following a three-hour bargaining session between the NBA and National Basketball Players Association, both sides walked away from the table far apart on several financial issues and the players opposed to a new salary cap system.
"It's with some sadness that we're going to recommend this to the (labor relations) committee because a lockout has a very large impact on a lot people, most of whom are not associated with either side." NBA Commissioner David Stern told reporters after meeting with the union in a midtown Manhattan hotel.
"That's why we had hoped that the proposal on which we had no choice but to end the negotiations would've been better and would've given us a different choice."
The lockout, which will mark the NBA's first work stoppage since the 1998-99 season was reduced by 32 games to 50, will take effect at 12:01 a.m. (0401 GMT) on Friday.
NBA officials have said 22 of the league's 30 clubs are losing money and that they are seeking contract changes to offset net losses they claim run to some $300 million.
"We just haven't been able to find that happy medium," said union chief Billy Hunter. "They are going to lock us out and now maybe we can really begin to negotiate."
The two sides have met twice a week for most of the past month and Hunter said the talks were much more professional than in 1998 when there was a lot of acrimony between the two sides. Still, the league rejected the union's latest proposal.
"We took a baby step, they didn't take any at all," said Hunter. "They started from what we considered an extreme number (initially) and trying to get to where we are, or us get to get to them, is mammoth."
Hunter would not discuss the union's proposal but said they requested information from the league and will schedule another meeting with them in the next couple of weeks after they have reviewed the documents.
The lockout would mark the second major North American sports league to shut down its operations, following the National Football League, which installed a lockout in March that is still in effect.
The current agreement calls for 57 percent of basketball related income be distributed to the players under a $58 million per team cap system.
The owners have asked for the revenue split to be 50-50, while the players reduced their counter proposal to 54.3 percent, or $100 million a year of additional revenue to the owners over a five-year term.
"We tried to avoid a lockout but unfortunately we didn't reach a deal," San Antonio Spurs forward Matt Bonner, a vice president of the NBPA executive committee told reporters. "We're going to keep working at it and hopefully get something done."
(Editing by Frank Pingue)