The Houston Rockets selling for $2.2 billion has other owners considering their options. That includes Brooklyn Nets owner Mikhail Prokhorov is looking to sell at the right price and timeline.
But the first team to be sold could be the Memphis Grizzlies.
A couple of minority owners have the rights to make an offer on the team this October and it’s possible primary owner Robert Pera may take it. Pera owns 30 percent of the team, the most of any minority owner (making him the primary owner), but Steve Kaplan and Daniel Straus have the rights to make an offer for the team, something broken down by ESPN back in 2016 and updated recently by The Ringer.
At that time, Kaplan and fellow minority owner Daniel Straus, an East Coast health care magnate and the team’s vice chairman, have an option to make a bid for controlling interest in the team at a price of their choice, sources said. At that point, Pera would have two options: buy out Kaplan and Straus at that named price, or sell his shares to them based on the same valuation. Control of the decision ultimately would rest with Pera.
Kapan and Pera have had a feud, which is part of this. The agreement set up between Pera and Kaplan/Straus back when Pera bought the teams says that Pera either needs to sell his shares to them at the price Kaplan/Straus set or buy them out, based on their percentage of that valuation. Pera is a largely absentee owner at this point who could turn a healthy profit selling his share.
There are 20 owners of the Grizzlies — including Justin Timberlake — all with a minority share, Pera just has the largest. Kaplan wants his own team, he was part of a group trying to buy both the Hawks and then the Timberwolves. This is his chance.
How much are the Grizzlies worth? Forbes estimated $790 million (their estimates are notoriously off), but based on what Forbes valued the Rockets at vs. what they sold for, the Memphis number is probably close to $1 billion. Pera owns 30 percent of the team, so we are talking around $300 million. If Kaplan bought the entire 30 percent, he would own a little more than 44 percent of the team.
Right now the Grizzlies are a profitable team, largely because the community has bought into with the “grit & grind” style and attitude and filled the building. However, while the team has retained Marc Gasol and Mike Conley, it has gotten older and will be in a fight to make the playoffs this season. A rebuild is in its future, which could impact future income and the sale price.
It’s all just something to watch. One way or another, there will be some movement in the Grizzlies ownership next month.