Thursday, December 17, 2015

NBA approves Prokhorov takeover of Nets/Barclays Center (operating company); arena transfer not on ESD agenda, total value said to be $1.9B

So, without any official notice, we learned yesterday from Scott Soshnick at Bloomberg News, NBA Approves Nets Transfer to Prokhorov at $1.9 Billion:
The National Basketball Association has approved ownership transfer of the Brooklyn Nets and Barclays Center to Russian billionaire Mikhail Prokhorov, a person with direct knowledge of the situation said.
The agreement values the team and arena at $1.9 billion. The person, who requested anonymity because the deal hasn’t been announced, declined to break down the valuation between the Nets and their venue.
Prokhorov, through his Onexim Sports & Entertainment, currently owns 80 percent of the team and 45 percent of the arena, which opened in 2012 and also houses hockey’s New York Islanders. Forest City Enterprises owns the remaining 20 percent and 55 percent, respectively.
If the arena is worth $1 billion, as so often bandied about, that puts the value of the team under $1 billion, which is par for most teams in the NBA, absent the $2 billion Los Angeles Clippers. That's a significant profit for Prokhorov, if not the vast numbers that have sometimes been suggested.

Forbes most recently valued the team at $1.5 billion, which now seems a stretch.

Note that only one, unnamed source provided the number.

ESD role?

Note that Prokhorov did not buy the Barclays Center but rather the operating company, as the arena is formally owned by New York State, a subsidiary of Empire State Development (ESD), to enable tax-exempt arena bonds. 

And despite calls yesterday by elected officials and neighborhood groups for ESD to intervene in the transfer of the operating company, it is not on today's ESD board meeting agenda. An ESD official has said this would be a simple staff signoff, not a public board vote.

There you go.
By the way, the unsubtle New York Post put it, Mikhail Prokhorov finishes buying clueless, sloppy Nets.

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