LOS ANGELES: Josh Kushner and Bob Iger are buying the Los Angeles Lakers basketball team for a record-breaking price of US$12.5bil, according to sources.
Kushner, founder and chief executive officer (CEO) at Thrive Capital, and Iger, former CEO of Walt Disney Co who is also an adviser at Thrive, had been seeking to acquire an National Basketball Association (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 the Iger-Kushner side and the deal moved quickly, with talks unfolding over three or four days and the final agreement coming together in the past 24 hours, Iger said in an interview with Bloomberg News.
The deal represents a 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 professional sports franchise, exceeding the US$9.6bil 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 US$10bil.
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 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 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.
“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 said in a statement at the time.
“We are cooperating with authorities, and we are confident these matters will be resolved favourably.”
Walter’s firm is in talks with investors to raise money to help pay down loans on the books of its insurers that had drawn scrutiny from the Justice Department, Bloomberg reported on Wednesday.
TWG Global has approached multiple investment firms about a range of deals to raise cash, Bloomberg reported.
Iger stepped down from the head of Disney, the parent company of ESPN, earlier this year.
He 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, US$76bil deal with the NBA in 2024 that kicked in with the league’s most recent season.
Kushner and his holding company Thrive Eternal, which targets cultural institutions and sports franchises, made waves recently when soccer’s governing body Fifa tried to raise US$4.2bil from investors.
This included Thrive that would have created a for-profit arm housing the organisation’s media and commercial rights. — Bloomberg
