Timberwolves could Sell for 1.5 Billion

[UnFadeable21]

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Forbes

In July, Sportico reported that Glen Taylor had hired Raine Group to sell his Minnesota Timberwolves. “Taylor is seeking at least $1.2 billion for the franchise that Forbes says is worth $1.38 billion, one of the people said,” Sportico reported.

The sale price has been climbing due to significant interest from various buyers. According to my sources, who would not reveal the names of the bidders, Taylor has already turned down an offer of $1.45 billion for the Timberwolves. One of the sports bankers told me he expects the team to sell for about $1.5 billion—also about 6.4 times normalized revenue.

The sale of the Jazz includes ownership of the team’s arena. But with the Timberwolves, who do not own their arena, the sale includes operating rights to the arena. This is an important distinction. The Jazz are the only major team sport in Utah. But the Timberwolves must compete with three teams for their entertainment dollars—Vikings (NFL), Twins (MLB), Wild (NHL). Moreover, when it comes to non-NBA events like concerts, the Timberwolves must go toe to toe with the Wild, who have a newer arena. As the Star Tribune reported, should the Timberwolves leave their arena lease before the end of the 2034-35 season the team they would owe the city of Minneapolis $50 million.

Bankers, however, remain cautious about Taylor selling the team. After all, he has had the tema on the market before only to change his mind. But the big picture here is that despite everything that has been going on the NBA remains a hot item—both for the bragging rights that come with owning an NBA team as well as potential buyers remain confident that even at more than six times revenue their investments will pay off in the long run.

[Jedzz]

A new thread, I thought this title would mean a sale was made.

You running for president with these posts lately? Learned a few tricks from the old trumper did ya?

6 times revenue. 1.5 bil. Tells you how much these values they put on teams are just monopoly games. Soon max contracts will be reaching half a billion dollars and the players will only sign if they get team stock.

[UnFadeable21]

A new thread, I thought this title would mean a sale was made.

You running for president with these posts lately? Learned a few tricks from the old trumper did ya?

6 times revenue. 1.5 bil. Tells you how much these values they put on teams are just monopoly games. Soon max contracts will be reaching half a billion dollars and the players will only sign if they get team stock.

A mod can merge this thread. No problem. I thought a sale was final too.

[King Malta]

Didn't you read the article before posting it?

Not to appear snarky but this was indeed a pretty misleading thread title.

[Jedzz]

Not to appear snarky

Oh you meant it!

[UnFadeable21]

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[minimus]

...

How many new threads you need? No offense, but please keep posting in existing threads about same topic. Otherwise MIN board will be a complete mess.

[Jedzz]

After this draft and two month offseason, the bid could start at One dollar or 1.75B.

I'm ready to approach the city of Minneapolis for one of those one dollar purchases of the stadium should they be sold and moved in order to save the city from having to pay to keep it up.

[UnFadeable21]

Whoever buys the team can still move the team by paying the 50 million buy out contract lease with Target Center and Minneapolis.

[KGdaBom]

Whoever buys the team can still move the team by paying the 50 million buy out contract lease with Target Center and Minneapolis.

I still believe that purchase language can be written into the sale prohibiting a move for at least a certain amount of time.

[Slim Tubby]

Whoever buys the team can still move the team by paying the 50 million buy out contract lease with Target Center and Minneapolis.

If we end up drafting Ball or Edwards, I'll help the Wolves load up their vans and even pitch in $20.00 for gas.

[winforlose]

Whoever buys the team can still move the team by paying the 50 million buy out contract lease with Target Center and Minneapolis.

I still believe that purchase language can be written into the sale prohibiting a move for at least a certain amount of time.

This is correct. There are any number of ways to draft it so that the buying party could face an independent penalty. However, the NBA came out and said that they will not bless any deal where the penalty is unreasonable in their judgment. I have no idea what their judgment will actually entail, but it does make it harder to keep the team here.

[Jedzz]

Whoever buys the team can still move the team by paying the 50 million buy out contract lease with Target Center and Minneapolis.

I still believe that purchase language can be written into the sale prohibiting a move for at least a certain amount of time.

This is correct. There are any number of ways to draft it so that the buying party could face an independent penalty. However, the NBA came out and said that they will not bless any deal where the penalty is unreasonable in their judgment. I have no idea what their judgment will actually entail, but it does make it harder to keep the team here.

That begs the question of why you would need the NBA to step in. If a buyer doesn't approve of stipulations in the contract of a sale they simply don't have to buy, period. If they choose to buy, then they have agreed to the stipulations in the sale contract. Not sure what the NBA has to do with that accept for outlandish contract stipulations that would somehow endanger the NBA itself.

Unless they categorically wouldn't for example bless any deal for any team that locks a team to a single city for 100 years. Sure, that would be unreasonable. So where is the cut off? 25 years, 10 years, 5, 3, or is time itself considered an unreasonable stipulation. Would they prefer a financial fine? Ok, so where is the cutoff in a financial fine for moving the team? 10 billion? 500MM? 1MM? Who decides unreasonable? How about if new owners cannot move the team within the next 5 years or you will pay an additional 50% of the sale price to the former owner? How about if moving within 5-10 years you will pay an additional 25% of the sale price to the owner? Are these unreasonable if the owner says his sale price is derrived on todays money and the agreement that the team stays and if moved he or his family/estate expects to be paid the appreciation of the teams value on top of what has already been paid because without the agreement of staying time in the contract he simply would not have sold. I don't know if you can say that is unreasonable. Don't accept the deal if you don't like it. Go after a different team.

[winforlose]

I still believe that purchase language can be written into the sale prohibiting a move for at least a certain amount of time.

This is correct. There are any number of ways to draft it so that the buying party could face an independent penalty. However, the NBA came out and said that they will not bless any deal where the penalty is unreasonable in their judgment. I have no idea what their judgment will actually entail, but it does make it harder to keep the team here.

That begs the question of why you would need the NBA to step in. If a buyer doesn't approve of stipulations in the contract of a sale they simply don't have to buy, period. If they choose to buy, then they have agreed to the stipulations in the sale contract. Not sure what the NBA has to do with that accept for outlandish contract stipulations that would somehow endanger the NBA itself.

Unless they categorically wouldn't for example bless any deal for any team that locks a team to a single city for 100 years. Sure, that would be unreasonable. So where is the cut off? 25 years, 10 years, 5, 3, or is time itself considered an unreasonable stipulation. Would they prefer a financial fine? Ok, so where is the cutoff in a financial fine for moving the team? 10 billion? 500MM? 1MM? Who decides unreasonable? How about if new owners cannot move the team within the next 5 years or you will pay an additional 50% of the sale price to the former owner? How about if moving within 5-10 years you will pay an additional 25% of the sale price to the owner? Are these unreasonable if the owner says his sale price is derrived on todays money and the agreement that the team stays and if moved he or his family/estate expects to be paid the appreciation of the teams value on top of what has already been paid because without the agreement of staying time in the contract he simply would not have sold. I don't know if you can say that is unreasonable. Don't accept the deal if you don't like it. Go after a different team.

This is not my primary area of law. I don’t know how the NBA is structured and how the individual teams function within league. Based solely on articles I have read, my guess is the league must bless any sale. There are a lot of reasons why this might be the case. Principal among them being profit sharing and reputation. You wouldn’t want someone with a history of bankruptcy and mismanagement to become a business partner for fear they sink the franchise. Likewise, you would want the new owner to have enough financial means to run the franchise appropriately after purchase. The league having veto power means they have final say on any deal. The league has made clear they won’t tolerate any deal they deem unreasonable. I cannot possibly speak to what they find reasonable or not. In property law you could prevent the team from moving for the life of a person. In contract law you could institute financial penalties for breaking the pledge not to move the team. In the end, the league gets to decide the max number of years and dollars by which Glen may contract for the team to remain in Minnesota. A part of this could also be they want owners to have flexibility in case a more profitable opportunity arises. Whatever the case may be, Glen has limited options.

[Jedzz]

Whatever the case may be, Glen has limited options.

Maybe, but he's still in the drivers seat. All of us should sit back and shut up before daddy gets mad and pulls this thing over and makes us all walk home.

[KGdaBom]

Whatever the case may be, Glen has limited options.

Maybe, but he's still in the drivers seat. All of us should sit back and shut up before daddy gets mad and pulls this thing over and makes us all walk home.

Glen's the only one with options. He has the option to keep the team or sell the team. Those options are limited to two, but that's more options than anybody wanting to buy the team has.

[Slim Tubby]

Did the KG group lack the financing necessary to acquire the team from Taylor? That talk has disappeared unless I missed some updates.

[shrink]

I hadn’t thought about this before, but I heard on a podcast that with Biden winning the election, estate taxes are likely going to become much more severe, especially for a rich guy like Glen Taylor. This may mean that he will rush to get a sale done before the end of the year, which may also mean he could be less picky about a buyer. Doogie says he has rejected all offers that could move the franchise out of the state - I worry he may not continue to hold the line.

[MarxyLebronist]

Whoever buys the team can still move the team by paying the 50 million buy out contract lease with Target Center and Minneapolis.

I still believe that purchase language can be written into the sale prohibiting a move for at least a certain amount of time.

Sale can't happen soon enough. Things are stuck in neutral in MIN as always. Wish it wasn't so.
Liked the defense they flashed in UTA, and the injury is the injury.

But this endless sale noise needs to finally be put to rest immediately. If there's no arena coming, that's just the facts and it's time to let another market make it happen the way the league prefers. SEA is ready, and many other places with plenty of capital for future development would love to host them this season in a TV-only run that only helps set up a fabulous opening next season. Hey, let Oakland have a team back even. Whatever gets it done. Heart is with MIN making it work, fur sure, but it's coming up toward a decade of the team always being on the block. One playoffs first-round exit in 20 years, yet another high pick being wasted (to say nothing of next year's already out the door).

[KGdaBom]

Whoever buys the team can still move the team by paying the 50 million buy out contract lease with Target Center and Minneapolis.

I still believe that purchase language can be written into the sale prohibiting a move for at least a certain amount of time.

Sale can't happen soon enough. Things are stuck in neutral in MIN as always. Wish it wasn't so.
Liked the defense they flashed in UTA, and the injury is the injury.

But this endless sale noise needs to finally be put to rest immediately. If there's no arena coming, that's just the facts and it's time to let another market make it happen the way the league prefers. SEA is ready, and many other places with plenty of capital for future development would love to host them this season in a TV-only run that only helps set up a fabulous opening next season. Hey, let Oakland have a team back even. Whatever gets it done. Heart is with MIN making it work, fur sure, but it's coming up toward a decade of the team always being on the block. One playoffs first-round exit in 20 years, yet another high pick being wasted (to say nothing of next year's already out the door).

I'm a Minnesota Sports fan as most of us here are. You think we give a rat's a$$ about whatever other markets are ready. I live in AZ and if they moved to Las Vegas they would be a lot closer. You think I care?