The Brooklyn Nets are back in the news, now with a change in ownership. Mikhail Prokhorov’s ownership of the Nets is coming to an end, but another deep-pocketed international owner will be entering.
By: Ilana Siyance
Prokhorov, the Russian Billionaire who owned a 51 percent controlling ownership share in the National Basketball Association team, has sold his stake. The buyer is none other than Joe Tsai, the Executive Vice Chairman of Alibaba Group Holding Ltd., who already owned 49 percent of the team. While the financial terms weren’t disclosed, Bloomberg News reported that an in-the-know source said Tsai paid a total of $3.5 billion for the team and the Barclay Arena, including debt.
Tsai who is one of Alibaba’s 18 founders, has an estimated net worth of $10.5 billion, as per the Bloomberg Billionaires Index. Taiwan-born Tsai, a Yale Law School graduate, also owns the WNBA’s New York Liberty. His previous 49 percent ownership of the Nets was purchased at a $2.3 billion valuation, which was a record for a U.S. pro sports franchise. He had until 2021 to buy the remaining 51% of the organization, which he has now exercised. While the sale still requires formal approval of NBA owners, it is said to be a done deal, and the transfer is expected to be completed by the end of September.
“I will be the beneficiary of Mikhail’s vision, which put the Nets in a great position to compete,” Tsai said in a statement on Friday. “We are committed to maintaining Barclays Center iconic status by bringing together culture, community and entertainment for our fans and everyone in New York.”
As part of the changes at Prokhorov’s BSE Global, the parent company of the Nets and arena, Chief Executive Officer Brett Yormark also announced his resignation from the team. “When I was hired nearly 15 years ago, my goal was to realize the vision for Barclays Center, move the Nets to Brooklyn, and build a world-class sports and entertainment company,” Yormark said.
Prokhorov, the first non-North American owner of an NBA team, is a political activist who made his fortune in Russia’s precious metal sector. The 6 foot’9 inch founder of the Russian Political party named Civic Platform has an estimated net worth of $9.2 billion, as per Forbes’ estimate in 2018. In 2010, Prokhorov had purchased 80 percent ownership of the Nets and 45 percent of the Arena, for $223 million. The team and arena are now being sold for the escalated price of $3.5 billion, which is quite a hefty profit and may be the biggest net return in sports history.
As per Bloomberg News, Prokhorov has made some major improvements to the team, with the team making the playoffs last season for the first time in four years. Moreover, during the offseason, the Nets made the high profile acquisition of two celebrated free agents: basketball stars Kyrie Irving and Kevin Durant. The new additions are slated to finally free the Nets from the Knick’s shadow, as a promising NYC team in the NBA.
“It has been an honor and a joy to open Barclays Center, bring the Nets to Brooklyn, and watch them grow strong roots in the community while cultivating global appeal,” Prokhorov said. “The team is in a better place today than ever before and I know that Joe will build on that success.”