Nets owners Joe Tsai and Clara Wu Tsai have agreed to sell a 15% stake in BSE Global – the team’s parent company – to Julia Koch and her children, according to a report from Scott Soshnick and Eben Novy-Williams of Sportico. The New York Post first reported the negotiations in February.
BSE Global was assessed with a valuation of $6 billion for the upcoming sale, per Sportico and Brian Lewis of The New York Post. That’s a significantly higher valuation than any NBA franchise has received as part of a stake sale, though it also takes into account the WNBA’s New York Liberty and the Barclays Center. The Tsais paid a total of $3.3 billion for the two teams and the arena, assuming full control in 2019.
The massive new figure likely reflects the impact of the NBA’s and WNBA’s upcoming TV deals, as well as the “growth in the economics” of the Barclays Center, Soshnick and Novy-Williams write.
“The $6 billion valuation is not stretched at all if you take into account a potential new NBA media deal, a hot WNBA team with exponential growth, and Barclays Center doing really well as a top concert venue,” one source told Lewis.
The widow of late billionaire David Koch, philanthropist Julia Koch inherited 42% of Koch Industries, one of the largest conglomerate companies in the United States, when her husband died. She and her family are said to be worth $65.2 billion, per Forbes.
Julia Koch’s group, which also includes her children David Jr., Mary Julia, and John, won’t have a path to gradually take over majority control of the Nets in stages – like the Tsais did when they initially bought in – as part of this deal. She also won’t become an alternate governor for the franchise. However, the Kochs will be given the right of first offer if Tsai decides to sell his majority stake in the team down the road.
The NBA’s advisory committee has reviewed the terms of the sale and recommended that the league’s Board of Governors approve it in a June 24 vote, per Sportico.