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NBA weighing investment vehicle to buy minority shares of individual teams

NBA

At the end of the day, the NBA is still a business. The whole world was reminded of this very fact of late, with news emerging pertaining to the league’s reported interest in investing on a small stake in individual teams.

In an article by Scott Soshnick of Bloomberg, this potentially money-making move is explained in more detail.

In a memo sent to owners, a copy of which was reviewed by Bloomberg News, the league says it’s exploring the potential formation of “a new capital vehicle that could purchase passive, minority ownership interests across multiple NBA teams.”

It is also being reported, however, that this plan is still in its early stages, and that at this point, the league is still testing the waters by asking team owners to weigh in on this matter.

The NBA is soliciting feedback from owners, seeking to gauge their interest in selling to such a vehicle, or allowing members of their ownership group to do so. The memo said specific terms — such as how much or little the vehicle could acquire from any team — haven’t been determined.

Owners are asked to respond by Wednesday.

While this is generally seen as a move to “provide additional liquidity for the sale of team ownership interests,” we should definitely expect some mixed reviews from the rest of the basketball world. We’re pretty sure that should this deal push through, the league will lay out a very transparent business model for the same. Nonetheless, it’s hard not to consider whether or not the NBA will now have some vested interest in some teams that they may potentially partially own.