Alibaba Co-Founder Buys NBA Team For Record Price
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Alibaba co-founder, Joseph Tsai, has concluded a deal for the controlling interests in NBA team Brooklyn Nets for $2.3 billion – an all-time record-high price for any U.S. sports franchise.
In addition to the $2.35 billion deal for the 51 percent stake, which makes Joseph Tsai the sole owner of the team, he will also pay nearly $1 billion more in a transaction for the Barclays Center.
According to a report which cites two anonymous sources, the transaction is expected to complete by the end of September, pending approval by the NBA’s Board of Governors. Tsai purchases both the team and the stadium from Russian billionaire Mikhail Prokhorov, from whom he also already purchased a 49 percent stake from in 2018.
Tsai’s 2018 acquisition included the option to become the sole controlling owner in four years. The team’s recent acquisition of megastars, Kevin Durand and Kyrie Irving from free agency, likely played a role in Tsai’s decision to exercise the right early and the team will undoubtedly experience an exponential boost in popularity, if not win rate.
Chinese exposure to global assets through major acquisitions continues to increase and sports teams, specifical football in Europe, have been trending for years. Examples of stakes purchased include in Aston Villa, West Bromwich Albion, Wolverhampton Wanderers and Southampton in England; Italy’s A.C. Milan and Inter Milan; Spain’s Atletico Madrid; and Slavia Prague in the Czech Republic.
And Tsai’s links with China through the gargantuan tech firm – in a nation where the NBA estimates one-fifth (300 million) of the population plays basketball – is likely to create synergies.
The team is in a better place today than ever before and I know that Joe will build on that success, Prokhorov said.
Questions & Answers
Q.What is the total value of Joseph Tsai's investment in the Brooklyn Nets and the Barclays Center?
What is the total value of Joseph Tsai's investment in the Brooklyn Nets and the Barclays Center?
Joseph Tsai's total investment is $2.3 billion for the controlling interest in the team, plus nearly $1 billion more for the Barclays Center. He already owned a 49 percent stake from a previous transaction.
Q.When is the deal expected to be finalised and what is required for its completion?
When is the deal expected to be finalised and what is required for its completion?
The transaction is expected to be finalised by the end of September. This is pending approval by the NBA’s Board of Governors, according to a report citing anonymous sources.
Q.Did Joseph Tsai have a prior ownership stake in the Brooklyn Nets before this latest deal?
Did Joseph Tsai have a prior ownership stake in the Brooklyn Nets before this latest deal?
Yes, Joseph Tsai purchased a 49 percent stake from Mikhail Prokhorov in 2018. That earlier acquisition included an option to become the sole controlling owner within four years.
Q.What factors may have influenced Joseph Tsai's decision to exercise his ownership option earlier than planned?
What factors may have influenced Joseph Tsai's decision to exercise his ownership option earlier than planned?
The team's recent acquisition of megastars Kevin Durant and Kyrie Irving from free agency likely played a role. This is expected to boost the team's popularity and potentially its win rate.
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