LA Lakers sold in record $17.7b deal as Trump associate and former Disney chief swoop

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Josh Kushner and Bob Iger are buying the Los Angeles Lakers basketball team for a record-breaking price of $US12.5 billion ($17.7 billion), according to people familiar with the matter.

Kushner, managing partner and co-founder at Thrive Capital, and Iger, former chief executive officer of Walt Disney Co. who is also an adviser at Thrive, had been seeking to acquire an NBA expansion team in Las Vegas but pivoted to make an offer to buy the Lakers from financier Mark Walter, whose sprawling investment empire is under federal investigation.

The first inquiry came from Iger-Kushner side and the deal moved quickly, with talks unfolding over a matter of three or four days and the final agreement coming together in the past 24 hours, Iger said in an interview with Bloomberg News on Wednesday.

The deal represents a longtime dream of Iger, who has overseen billion-dollar NBA rights contracts for Disney’s ESPN division, but not owned a professional basketball team. It underscores the booming prices private equity firms are willing to pay for the top-tier sports franchises globally as those media rights continue to climb.

The executive recalled that Kushner, who is the brother of President Donald Trump’s son-in-law, likened buying the Lakers to purchasing the Mona Lisa. “This is a beachfront property on one of the best beaches in the world as I see it,” Iger said.

Founded in 1947, the Los Angeles Lakers have been a powerhouse in the NBA. After moving from Minneapolis in 1960 to become the NBA’s first West Coast team, the Lakers have been in the finals 32 times and won 17 championships, establishing them as one of the most successful legacies in professional sports. Their “Showtime” era in the 1980s was led by superstar players like Kareem Abdul-Jabbar and Magic Johnson. The fast-paced game the Lakers pioneered continues to influence the sport to this day.

The Lakers’ sale price is the highest ever for a US professional sports franchise, exceeding the $US9.6 billion paid for the National Football League’s Seattle Seahawks in July.

“It’s stunning in terms of the amount and size,” said Lee Berke, CEO of sports media consultancy LHB Sports, Entertainment & Media. “If I was an NBA team, I’d be thrilled.”

Walter, who also owns the Los Angeles Dodgers baseball team and is an investor in English Premier League club Chelsea, bought a majority stake in the Lakers from the Buss family just over a year ago, in a deal valued at $US10 billion. Despite the change in majority owner, the league said at the time that Jeanie Buss, one of the children of the longtime owner Jerry Buss, would remain the team’s controlling governor for the foreseeable future.

The billionaire CEO of Guggenheim Partners is dealing with a federal investigation into potential improprieties at two of his insurance companies and his global investment firm. Walter’s holding company, TWG Global, holds stakes in the sports teams as well as Walter’s insurance companies and in Guggenheim.

Part of the inquiry involved representations Guggenheim made to outside parties about its revenue, Bloomberg reported in July.

“Mark Walter and TWG have always acted in good faith, and those who have done business with Mark know him as honest and straightforward,” TWG Global, Walter’s holding company, said in a statement at the time. “We are cooperating with authorities, and we are confident these matters will be resolved favourably.”

Iger stepped down from the head of Disney, the parent company of ESPN, earlier this year but his association with sports goes back decades. A longtime Clippers fan, Iger previously worked at ABC Sports under media legend Roone Arledge and became the division’s vice president of programming in 1987. He joined Disney following the company’s acquisition of ABC and ESPN in 1996. The NBA aired on ABC from 1965 until 1973 and on ESPN between 1982 and 1984 before returning to both channels in 2002. Disney, Comcast Corp. and Amazon.com Inc. signed an 11-year, $US76 billion deal with the NBA in 2024 that kicked in with the league’s most recent season.

Kushner and his newly formed holding company Thrive Eternal, which targets cultural institutions and sports franchises, made waves in the last two weeks when soccer’s governing body FIFA attempted to raise $US4.2 billion from investors including Thrive that would have created a for-profit arm housing the organisation’s media and commercial rights. The deal died after extreme pushback from UEFA and Concacaf.

Source: Read the original article on www.smh.com.au