According to a report from The Deal Pipeline, Joshua Harris (pictured above) is, in fact, leading a group of investors to buy the Sixers. The talks are ongoing but an announcement is expected within the next two to three weeks. A few more details to follow:
- Harris and the rest of the group will fund the purchase out of their own pocket. The deal is not being done by private equity firms.
- The sales price is expected to be $300M+.
- The Wells Fargo Center will not be a part of the deal.
- The source basically said Snider cares more about hockey and the team needs "someone to be the face of the team and get fans to come back."
- The source also said a work stoppage will happen, and when the dust settles, the NBA will be more favorable for the owners (hence, a good time to buy).
- The Sixers have been looking for a buyer for a while now. The success they had this season made it a good time to do the deal.
Other reports are now trickling in as well. This one from Forbes cites the Sixers bargain-basement TV deal could be an immediate win for the new owners, pumping up revenues by $12M by their math. Of course, what that story doesn't take into account is the usage fees Comcast charges the Sixers for the arena, which they also own. If Comcast sets the rent low, that takes away the immediate gains from a more lucrative TV deal.
My take here is that this is probably going to wind up being a good move for the team. On the one hand, this group clearly isn't getting into this situation to lose money. On the other hand, there seem to be clear means to pump up the revenue outside of basketball decisions (TV rights, for example). This is most likely an opportune time to get into the NBA ownership racket, the next CBA will almost surely be more favorable to the owners. I think it's a very positive sign that the money is coming from this group of investors directly rather than from a PE firm's fund. It hasn't been decided if they will use leverage to accomplish the purchase.
It's going to come down to how motivated the new owners are to put a winner on the floor, and how smart they in going about it. Kate Fagan said the sale will have no impact on basketball operations in the short term, but I find that hard to believe. There's no way Comcast will do anything that could potentially devalue the franchise prior to ink being on the contract and league approval in the bag. At the very least, you'd have to think the potential buyer will have some input on whether a deal should happen or not.
This deal may come with a new president/GM attached in Jason Levien who worked in Sacramento's front office until a year ago when he was pushed out. Levien gave up a lucrative gig as an agent to run a team, it's not too much of a leap to think this will be his chance.
The story linked to at the top of this story is only available to The Deal Pipeline subscribers. It was written by Lisa Ward and myself.