Joe Tsai is reportedly buying the Brooklyn Nets and the Barclays Center for around $3.5 billion. The agreement could be announced as soon as Friday.
The Taiwan-born Tsai is among the 18 co-founders of Alibaba. He currently sits as the executive vice-chairman of the company. Forbes estimates his worth to be around $9.9 billion. He is Alibaba’s second-largest shareholder after Jack Ma. The Yale-educated businessman is presumed to take on an even bigger role once Ma steps down from Alibaba.
The deal would give Tsai control of the Brooklyn Nets. In May 2018, Tsai was able to buy 49% of the Brooklyn Nets from Mikhail Prokhorov for $1 billion.
Upon closing the deal last year, Prohorov welcomed Tsai into the organization and said: “We are excited to have Joe as a partner. He brings tremendous global experience, a passion for basketball, and shares our vision for the development of the Nets”
In last year’s deal, Tsai was given the option to buy the remaining stake of the team in 2021. However, it seems that the deal would be coming earlier than expected. Prohorov currently owns 59% of the basketball franchise.
If the deal between Tsai and Prohorov has been finalized, this would give the former full ownership of the team — two seasons earlier than anticipated. With the team’s valuation of $2.35 billion, this deal would make it the highest price ever paid for a sports team franchise in history.
The current record is held by David Tepper and Tilman Fertitta. Tepper bought the NFL’s Carolina Panthers in 2018 for $2.2 billion. In 2017, the owner of multi-brand corporation Landry’s, Fertitta bought the Houston Rockets for the same amount.
The ownership of the Brooklyn Nets is not the only deal that Tsai is reportedly making with Prokhorov. In a separate deal, Prokhorov is selling his stakes in the Barclays Center to Tsai. The arena is where the Nets play during their home games. This follows the NBA’s preference for the team and the arena where they play to be under one ownership. If both deals are combined, it would amount to a record-breaking $3.5 billion.
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Joe Tsai is no stranger to sports team ownership. Before buying his stakes of the Nets, Tsai bought box lacrosse team — San Diego Seals. In January 2019, he headed a group that bought the WNBA’s New York Liberty from The Madison Square Company. A month after, Tsai joined The Raine Group and The Chernin Group in investing in a new lacrosse league — the Premier Lacrosse League.
With the Nets deal, this would make Tsai as the eight richest sports team owner in the world. In the NBA, he becomes second only to the owner of the Los Angeles Clippers, Steve Ballmer.
The change in the principal owner of the Brooklyn Nets comes after the team’s good run in the NBA last season. The team made it to the playoffs for the first time in four years.
Before the new NBA season starts, the Brooklyn Nets have already gotten the services of two free agents — Kyrie Irving and Kevin Durant. With the addition of the pair to the team roster, attendance is expected to increase. Last season, the Nets ranked 14th in terms of attendance with an average 14,941 per game.
While Tsai’s take over of the Nets is still subject for approval by the NBA, this move is seen as something positive and beneficial to and for the league. The NBA is currently growing at a rapid speed in China. To add, Joe Tsai is part of NBA China’s board. NBA China conducts the league’s business in the country.
With the NBA’s growth in the country, it has become such a massive business. The NBA has become China’s most popular sports league. With its growing fanbase, the NBA has also expanded its reach by opening NBA stores in China. In April of this year, the NBA opened its biggest official store outside of North America in Beijing.
Dubbed as the “Joe Tsai effect,” the Brooklyn Nets will be joining the Los Angeles Lakers in the 13th edition of the NBA China Games. The two teams will play two preseason games in Shanghai and Shenzhen in October.