Earlier this year, Brooklyn Nets majority shareholder Mikhail Prokhorov was looking to sell his share of the team and their stadium, but now it looks like the Russian oligarch has changed his mind.
According to Mitch Abramson of the New York Daily News, Prokhorov’s seeking to buy out the team and its $US1 billion home stadium, the Barclays Center.
The word is that the 10th wealthiest man in Russia might want to settle a debt of an undisclosed amount that Bruce Ratner, the team’s minority shareholder, owes him — though no one can be for sure.
The team, which is currently juggling debt due to a bad television deal and high payroll for players, is worth about $US1.5 billion, reported Forbes.
The sense within the industry is that Prokhorov wants to buy the team to sell it at a higher profit later, the Daily News reported.
“We can confirm that Onexim Sports and Entertainment is looking at various ways to restructure debt owed to the company in connection with its US assets,” said a spokesperson for Prokhorov and his holding company, ONEXIM, over email to the Daily News. “One possibility is the conversion of such debt into equity and consolidation of shares, but there are other scenarios also under consideration by Onexim and its partners, and no decision has yet been made.”
In other words, it’s a proposed debt-to-equity swap.
Prokhorov owns 80 per cent of the team, and 45 per cent of the stadium.
At the time of purchase, Prokhorov agreed to pay 80 per cent of the team’s $US220 million debt, ESPN reported. Russia’s own tenuous economic situation may also be a factor in Prokhorov’s decision.