NBA changes PE rules ahead of proposed $12.5bn Lakers acquisition
The NBA is changing its rules governing private equity investment in franchises, clearing a potential regulatory hurdle for the proposed $12.5bn acquisition of the Los Angeles Lakers by Joshua Kushner and Bob Iger, according to a report by Bloomberg.
The National Basketball Association (NBA) has revised its regulations concerning private equity investments in franchises, potentially clearing a regulatory obstacle for a $12.5 billion acquisition of the Los Angeles Lakers by Joshua Kushner and Bob Iger, according to Bloomberg. This updated policy allows a private equity firm and its executives to invest in the same NBA team, enabling Kushner and Iger to combine personal capital with investments from Thrive Eternal, their investment firm.
The NBA has not commented on the amendment, while Thrive Eternal has not responded to inquiries. The record-breaking $12.5 billion valuation for the Lakers acquisition has sparked discussions about whether Thrive Eternal can participate financially due to Kushner’s role at the firm and the league’s past restrictions on private equity executives investing alongside their firms.
Under the modified rules, a private equity firm investing alongside one of its executives would be barred from holding an interest in another NBA franchise. This change may broaden the potential buyer pool for NBA teams, given the rising valuations of franchises and the increased capital needed for controlling interests. The new framework may also be applicable to existing NBA owners with private equity backgrounds, such as Atlanta Hawks owner Tony Ressler and Boston Celtics owner Bill Chisholm, who are associated with Apollo Global Management and Symphony Technology Group, respectively.
The Lakers deal, however, still requires approval from the NBA Board of Governors, with a decision potentially announced later in the year.
Written by urgent.news from Private Equity Wire's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
