Mikhail Prokhorov Puts Brooklyn Nets Up For Sale [Report]
Is Mikhail Prokhorov putting the for-sale sign out for the Brooklyn Nets?
Reports suggest that the Russian billionaire who bought the team in May 2010 may be doing just that.
Prokhorov owns a 80 percent stake in the NBA team, plus 45 percent of the Barclays Center, the Nets’ Brooklyn home court where the team moved to from Northern New Jersey. He allegedly has hired investment bank Evercore Partners to explore unloading the team.
The declining value of the Russian ruble against the U.S. dollar may be motivating a potential transaction for the Nets.
According to Bloomberg News, the investment isn’t proving too lucrative for Prokhorov.
“Prokhorov paid about $220 million for his share of the Nets, which according to ESPN lost $144 million last season.”
Also a former Russian presidential candidate, running unsuccessfully against Vladimir Putin in 2012, Prokhorov has thrown money around George Steinbrenner-style, with little bang for his buck. This season, the Nets — with the league’s highest payroll — are currently in last place in the NBA Eastern Conference, with a record of 16-22. Last year, the Nets won 44 games but were knocked out of the playoffs in the second round.
“Prokhorov has run the Nets’ payroll to record levels, including a combined $190 million in salary and luxury tax for the 2013-14 season,” Yahoo! Sports reported. Added NBC Sports about what might have been a bad investment by Prokhorov: “[The Nets] have tons of committed salary for underwhelming players, and they’ve traded away many future draft picks.”
About a possible sale of the Brooklyn Nets, the team issued the following statement.
“As we have said for many months, ownership is always open to listening to offers — that’s just good business. There is nothing imminent in terms of a sale of any stake in the team.”
The Brooklyn NBA team is worth approximately $1.3 billion (or maybe more, according to some estimates), which is less than the Los Angeles Clippers, which sold for a staggering $2 billion after ownership famously or infamously switched from Donald Sterling to Steve Ballmer. “Because of their home in the No. 1 U.S. media market, and the infrequency with which marquee franchises become available, the Nets might fetch more than the record $2 billion former Microsoft Corp. Chief Executive Officer Steve Ballmer paid for the Los Angeles Clippers in a frenzied auction sparked by racist comments made by former owner Donald Sterling,” a valuations expert told Bloomberg.
The Atlanta Hawks are also up for sale.
In an interview in November, Mikhail Prokhorov was noncommital about selling the Brooklyn Nets.
“My position is that I will not give up control of the team. But you know, I am quite happy when somebody sending me a nice offer without taking my control of team. I think, for the time being, nothing is imminent, but still I think it’s not bad just to listen.”
BREAKING: @BrooklynNets are for sale, 2 sources say. Mikhail Prokhorov hires Evercore to sell the @NBA team. Story posting soon. #sportsbiz
— Scott Soshnick (@soshnick) January 13, 2015
[image credit: A. Savin]
