Major ownership drama may be coming

[winforlose]

So apparently A-Rod is having trouble raising his half of the money so Lore is footing the bill and amassing more ownership interest. However, if Lore and A-Rod together cannot gather sufficient funds for the final takeover, we could end up with an ownership group instead of a partnership. All of this is due to the break up of A-Rod and Jlo.

https://www.google.com/amp/s/nypost.com/2022/08/29/a-rods-1-5b-deal-to-buy-t-wolves-at-risk-and-some-blame-j-lo-breakup/amp/

[Klomp]

The NYPost is the definition of clickbait fluff, stop freaking out about stuff that probably doesn't matter

[winforlose]

The NYPost is the definition of clickbait fluff, stop freaking out about stuff that probably doesn't matter

Maybe you are right. Not sure one way or the other. Worth mentioning.

[Nick K]

The NYPost is the definition of clickbait fluff, stop freaking out about stuff that probably doesn't matter

Yep. I think that's it.

I don't think ARod and JLo ever married. But she was an impressive partner with her money to potentially support his endeavors. He has plenty of money but he isn't liquid. I think he works it out but might end up being a subordinated owner to Lore.

I don't see this as a deal breaker whatsoever.

[Note30]

I thought Lore was footing the majority of the bill this whole time lol

[Dewey]

Not a huge JLo fan, but I'm not gonna lie ... I'd be ok with her sitting court-side if it ever came to be.

[Saltine]

clickbait... He can easily get a loan with his real estate holdings as collateral if he actually needs the cash.

[Klomp]

Read on Twitter

[HartfordWhalers]

Read on Twitter

Wasn't the report that Glen thought the value had gone from 1.5b that this deal was locked up at, to now a higher the 2b area?

If so, if I were Glen I would be happiest if the deal fell through and I could sell the remaining 80% at that higher valuation, and (pre-tax) net an extra 400m.

[HartfordWhalers]

clickbait... He can easily get a loan with his real estate holdings as collateral if he actually needs the cash.

And yet he didn't before, which certainly makes that assumption at least somewhat questionable.

The two were supposed to put up 300m (250m cash and take on 50m in debt). Assuming the articles percentages are correct -- and it looks like they aren't being disputed anywhere -- Arod put up 100-105m instead of the 150m he was supposed to.

Now, this is speculation, but if he really was that illiquid, it wouldn't be that surprising if it was Arod putting up just 50m cash and taking on the full 50m of debt, with Lore putting in the 200m cash.

Will be interesting to see how this (super slowly) evolves.

[thinktank]

clickbait... He can easily get a loan with his real estate holdings as collateral if he actually needs the cash.

False.

You can’t buy an NBA team with loaned money. It’s a rule. You have to pay for it with your own money.

[winforlose]

Look guys, I don’t know how credible any of this is. I saw it, thought it was worth sharing, and in the days since it has been picked up by everyone. That said, every story sights the same source. Could be all smoke and no fire. The 13 and 7 split was what made me wonder if this was legit. Either way it is something to keep an eye out for.

[Saltine]

Paying your partner in cash, which you borrowed against your assets, is not the same as leveraging yourself to buy a team... The entire story is nonsense. The share of the team that Arod owns is irrelevant to everyone but Arod and some idiots in New York.

[younggunsmn]

I think we all knew going in Lore was going to be the majority partner.
What share Arod has is not significant as he is more the face of the group.
A good chunk of his share will probably be leveraged, most likely against his real estate holdings.

The real estate market/rising interest rates could play a bit of havoc with the deal, as well as possibly the recently "closed" carried interest loophole in the tax code. Financial environment definitely less friendly than a year ago.

I'm not an expert in what those kinds of loans would look like as far as term/fixed/variable, but I imagine they are a good bit less friendly than your standard 30 year fixed home loan.
Most sports owners rely on the value of the team perpetually going up to keep rolling them forward and cashing in on that sweet sweet equity (which is what makes them attractive to lenders).
Taylor bought the team for what 90 million way back when?

[minimus]

Clickbait

[NebWolvesFan]

Lore really seems good at making money. He just started that new fresh food delivery business and it's already worth $3.5 billion. He could sell that tomorrow and probably get $2 billion. He will have the money to buy the team.

ARod also has stakes in a lot of businesses. He may need to sell his stakes in those buildings to pay his share.

I could see Lore telling Arod he doesn't have to go all in. I could also see another partner brought into the mix. Johnny Athletic said the team's worth is already jumping to $2 billion. And if Ant can help get a new arena built, the value could jump to 2.5 or 3 billion. There will be a long line of guys willing to pay 150 million for 10 percent in a business that could be worth 2.5 billion in 10 years. That's 100 million dollar profit along with the prestige of being an NBA owner.

I'm not worried.

In fact, it looks like Lore has played Taylor - telling him he needs mentoring lol - to get the old man to give his team away for 1.5 billion.

[Neeva]

I’d be fine with Lore being the full owner.

[shrink]

I was always skeptical that A-Rod was going to be an equal partner with Lore. We gasp at the money sports stars make, but it’s a fraction of what billionaires have. I think of them as a separate class of “rich.”

To me, this situation seemed analogous to the previous Wolves offers, where one group tried to make Kevin Garnett a partner, while he only has a fraction of the wealth needed to buy a sports franchise. A billionaire buyer (or ownership group) is rarely a household name and doesn’t bring media splash with his offer. Pairing with a sports star gets people excited, which creates pressure on the current owner to sell, and the NBA Board of Governors to vote to accept him. With no heirs that want the Wolves, I think Taylor has been ready for a while (except for a brief period where Flip got him excited and he switched from selling to upping his ownership share). But Lore has to worry that if he made an offer without A-Rod, the guy who made his money from diapers.com and Wal-Mart does not give the impression of a high class new owner.

Now that we feel we know Lore though, A-Rod’s money or influence doesn’t seem all that important.

[Dewey]

I was always skeptical that A-Rod was going to be an equal partner with Lore. We gasp at the money sports stars make, but it’s a fraction of what billionaires have. I think of them as a separate class of “rich.”

To me, this situation seemed analogous to the previous Wolves offers, where one group tried to make Kevin Garnett a partner, while he only has a fraction of the wealth needed to buy a sports franchise. A billionaire buyer (or ownership group) is rarely a household name and doesn’t bring media splash with his offer. Pairing with a sports star gets people excited, which creates pressure on the current owner to sell, and the NBA Board of Governors to vote to accept him. With no heirs that want the Wolves, I think Taylor has been ready for a while (except for a brief period where Flip got him excited and he switched from selling to upping his ownership share). But Lore has to worry that if he made an offer without A-Rod, the guy who made his money from diapers.com and Wal-Mart does not give the impression of a high class new owner.

Now that we feel we know Lore though, A-Rod’s money or influence doesn’t seem all that important.

I think one of the keys to remember is Lore’s portfolio is continuing to generate income via ongoing business revenue. A-Rod may have a portfolio upfront with some money and investments, but a far lessor degree of ongoing business revenue. The word “sustainability” maybe fits here and I think helps explain who carries the weight.