Right now, NBA teams have no revenue flowing in, forcing them into some hard decisions. Just like most every other business in America right now. NBA owners are often getting hit on multiple fronts, with their core business and NBA team being hit at the same time. They are looking for some cash, some liquidity.
In San Antonio, the Spurs are selling off a minority share of the team, something first reported by Sportico’s editor and chief Scott Soshnick (writing for now at Variety). This would not be a majority share of the team, but rather a minority partnership.
It isn’t known which member of the National Basketball Association team’s ownership group is selling or how large a stake is available. The Spurs are controlled by the Holt family, but the ownership group includes a number of investors.
It has become increasingly difficult for owners to unload limited partnerships, or LPs as they’re known, as the valuations of professional sports franchises have skyrocketed. The Spurs, for instance, are worth about $1.8 billion, according to Forbes magazine, meaning a 5% stake would cost about $90 million.
That said, because limited stakes often come without a board seat or a say in how the franchise is run, there’s usually what’s referred to as an LP discount of 10-25%.
Whoever is selling their shares, the Holt family emphasized in a statement this is not going to mean the Spurs are on the move.
“As an ownership group we remain 100 percent committed to the city of San Antonio. Every day we celebrate the amazing relationship that exists between our community, our fans, and our Spurs. San Antonio is home and will remain home.”
This also does not mean changes in how the Spurs are run; they have been considered a model franchise in the NBA for decades.
This may not be the last owner to sell part — or, for some, maybe all — of their shares of the team as they deal with the economic fallout of the coronavirus.