Joseph Tsai reportedly purchasing remaining 51% share of Brooklyn Nets, for $1.35B

[fast+forward]

Why does Prokhorov want to sell?

He paid ~350mn for Nets and OpRights to Barclays.

10x in less than 10 years much?

I understand the team is worth a lot more now, but shouldn’t the team continue to appreciate if the league is healthy?

Either he needs cash now for some reason, has conflicting interests or he foresees the league taking a tailspin

Maybe he senses frozen assets in his future.

[HeartBreakKid]

Hope the deal includes the real estate. Otherwise...yikes!

Edit: I predict these 4B+ sports franchise valuations are going to look terrible sooner rather than later (if not immediately). Using Forbes numbers (2019 Nets = ~50M NI) and an aggressive discounted cash flow analysis over ten years instead of five @ only 5% discount rate, Nets should be worth ~400M.

Perhaps you might argue that's an impractical valuation method because these franchises are really rare pieces of art and hold value beyond the financials. Sure, except there are ~2000 billionaires in the world. Let's assume that 5% are die hard NBA fans and want to own an NBA team regardless of supporting financials. So 100 potential owners, many of which wouldn't be able to come up with the full 4B, and many of which already own an NBA team. Where is the NBA going to get all these future "collectors"?

They don't need to have a full four billion - these are joint ventures. To become an NBA owner you just need a plurality not a majority I think.

[SWYM]

Why does Prokhorov want to sell?

He paid ~350mn for Nets and OpRights to Barclays.

10x in less than 10 years much?

I understand the team is worth a lot more now, but shouldn’t the team continue to appreciate if the league is healthy?

Either he needs cash now for some reason, has conflicting interests or he foresees the league taking a tailspin

Nets are NOT going to appreciate 10x every ten 10 yrs.

Dude just killed it for 40% of his net worth in less than 10 years in an all cash deal.

[TheFinishSniper]

Given Nets were likely pain for him since purchase it makes sense to sell it when team is starting to look good. Only reason he kept a team likely all this years was Nets were sucking blackhole. With no star, no picks or young prospects till end of 2017.

[VanWest82]

Hope the deal includes the real estate. Otherwise...yikes!

Edit: I predict these 4B+ sports franchise valuations are going to look terrible sooner rather than later (if not immediately). Using Forbes numbers (2019 Nets = ~50M NI) and an aggressive discounted cash flow analysis over ten years instead of five @ only 5% discount rate, Nets should be worth ~400M.

Perhaps you might argue that's an impractical valuation method because these franchises are really rare pieces of art and hold value beyond the financials. Sure, except there are ~2000 billionaires in the world. Let's assume that 5% are die hard NBA fans and want to own an NBA team regardless of supporting financials. So 100 potential owners, many of which wouldn't be able to come up with the full 4B, and many of which already own an NBA team. Where is the NBA going to get all these future "collectors"?

They don't need to have a full four billion - these are joint ventures. To become an NBA owner you just need a plurality not a majority I think.

NBA has restrictions on that, I think. Either way, I misread the title. The way it was originally worded made it sound like 51% of the total value equaling 2.35B when in fact that was the total value.

[ChiCitySPORTS#1]

Wait - am i reading this right? 2.35B for 51% of the nets? That would be a valuation of almost $5B. Thats ludicrous

[bisme37]

Why does Prokhorov want to sell?

Wants to devote all of his time to insulting the Celtics on RealGM.

[Clay Davis]

Weird, his wikipedia page says that Joseph Tsai is Chinese-Canadian but there seems to be no mention of any Canadian roots on his Wikipedia page.

[Forbes]

I think the timing of this buy is great. It sounds like a lot now but these values just keep rising every year. Between the TV deals and the league just becoming a cash cow, Durant and Kyrie marketability, potentially a winning team for the next couple of years. Not a bad investment at all.