Pablo Torre Finds Out
The Sporting Class: How the NBA's Masters of the Universe Box Each Other Out
Thu, 03 Apr 2025
Franchise valuations are going up, up, up — and the first $10 billion team can't be far away. But inside the owners' meetings, though, generational warfare is underway: Can A-Rod snag the Timberwolves from the iron grip of an 83-year-old billionaire? Will the Celtics make private equity sexy? And how long until every NBA game is on national TV? Pablo Torre & The Expiring Assets (aka John Skipper and David Samson with a cold) are back to appraise Gollum's ring and stare into James Dolan's all-seeing Eye of Seventh Avenue. • Previously: How the Billion-Dollar War to Own the Timberwolves Went Nuclear https://www.youtube.com/watch?v=tmOkcQwZ-s8 • Subscribe to Nothing Personal with David Samson https://www.youtube.com/@NPDS Learn more about your ad choices. Visit podcastchoices.com/adchoices
Chapter 1: What is the main focus of today's NBA discussion?
Well, that's if there's a board of governors. Baseball doesn't have that. They've control people. And so there's one control person. But I would say that Alex Rodriguez will be at every owner's meeting. It's not set with just one person like John Henry and Tom Werner own the Red Sox, but John Henry's the control person, but both go to meetings.
But what Rob Manfred does, and you can call Adam Silver and see if he does this, Rob will do one per club meetings. where you only meet with the control people. No substitutions allowed. So that one only Mark would be able to go to and not Alex if Adam is extremely strict on that issue.
Chapter 2: What happened with the Timberwolves ownership saga?
But is the governor is the voting member? So if there are league issues, is that the sole purpose
prerogative and the sole thing that a governor gets to do is he basically is the voter for that club well you actually can bind that club uh when it comes to league matters and then if you really want to go into detail we can talk about partnership agreements where the agreement between alex and mark most assuredly discusses what rights the governor has
when the governor has to go back to Alex and talk about what Mark would vote for to bind the Minnesota Timberwolves. That's part of a partnership agreement where they discuss and figure out their own governance. But in terms of the NBA, when votes are taken or MLB or the NFL,
It's one person voting one time per club for every vote to approve a CBA, to approve a broadcast deal, to approve a rule change. You name it. When the vote happens, one person per club gets to make that vote.
Now, it is worth reiterating, though, that Glenn Taylor is a bit of a legendary and infamous figure in the NBA. And a lot of my reporting into this did establish that the guy, when it came to trying to pry away his team, held it with a grip that can only be described as, yeah, ironclad. I mean, the guy bought the team, the T-Wolves, for $88 million in 1994, John. Mm-hmm. 88 million dollars.
Then again, 2021 agreed to this three part sale with these tranches, which were then delivered, but then disputed whether they came in on time. And this was a big crux of what had to go eventually after a dispute that was made public on my show in large part had to go to arbitration and arbitration happened immediately. And there's a whole backstory there that I cannot wait to fully report.
But all you got to know for now is that February, there's arbitration in Minneapolis. It is a three judge panel. Two judges rule in favor of Mark and Alex. The one votes in favor of
And so now we're at this point where I am told reliably that one factor that determined whether Glenn Taylor was going to appeal or not appeal that arbitration ruling was the fact that the NBA's tax bill, the luxury tax bill that you got to pay as an owner of the team for your roster is due at the end of June. And so Glenn Taylor had to do the math.
If I do a Hail Mary here to appeal, is it possible that I could rest control back into my iron grip? Or am I better not risking what is, it seems, according to last check, and again, I can't define second apron right now because I frankly don't understand the fine details, the finer points of it, but a load of money. that the T-wolves would have to pay Glenn Taylors like Mark and Alex, guess what?
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Chapter 3: How are franchise valuations changing in the NBA?
Chapter 4: What is the significance of step transactions in NBA sales?
And this has been a snag, it turns out, in the Celtics' step transaction.
So this is a major issue that all the leagues have as these prices go and continue to rise at the level that they're getting to. Part of the Celtics transaction involves another private equity firm called Sixth Street Partners, and they've circled the billion dollars. That means that they're willing to put in a billion dollars into the Celtics deal.
Because when a team is worth 7.3, you're not spending 7.3. You're spending 7.3 minus the debt that is associated with that team. So just pretend they've got half a billion dollars in debt. That means a buyer has to come up with approximately, just call it $6.8 billion. So you go out and you put a group together, a syndicate.
And if you go to a private equity firm and they agree to put a billion dollars in, the NBA rule says that the control person, the governor, William Chisholm, has to put in a billion dollars at least of his own money into the deal. That's the rule. The problem is these rules are going to get broken soon as these numbers keep going higher.
So Adam Silver is going to have to figure out what exceptions he's going to be willing to make.
Ultimately, though, relative to sports business, what this continues to mean is that the valuation of clubs is going up, up, and up. And just for fun, what year would you assume we'll see a team be sold for $10 billion?
Well, it depends what team. I would tell you that if the Yankees or the Cowboys decided to sell now or if there were a death in the family or something that caused the sale or a divorce like happened with the Dodgers, I think it just depends on which team. Because you're conveniently forgetting that the Mavericks just sold for a value of only 1.75, I believe.
And that was a pretty recent transaction. So the Celtics are truly in rarefied air, not just in number, obviously, but also as an asset. Pablo, I may have the number wrong, but I think I'm close.
So Cubans sold 72.3% of the Mavericks to the Adelson family for 3.5% in December 2023. If you're to break that down into its component parts, I don't know what the Mavericks alone would be. I assume there's other stuff in there. Coco will help me figure out. Because buildings and land, of course, are always in these deals. They get sort of like flattened into a basic purchase price.
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Chapter 5: How does private equity affect NBA team ownership?
I don't really care. I'm just interested in why that would matter. That would matter. What are you protecting by not saying, oh, I used to suggest that I had the most expensive season tickets in the world because when ESPN bought rights, we did often call up and get some free tickets. Never a free season ticket. Just want to be clear. Never a free season ticket.
John, the way it worked when you were at ESPN is we get a call from MLB saying John Skipper would like three tickets and he will only be in the owner's suite. I never said that. It couldn't be me. John, where were you during the World Series in 03? Were you sitting like in the dug?
Were you sitting in the outfield? We're back to Frost-Nixon.
No, no.
I suspect that the magnanimous...
Owners and management of the Florida Marlins would extend me the invitation to come up and say hello to the owner, which I would just enjoy doing. But I actually prefer to watch the game from somewhere other than a suite almost any time I would rather sit in the stands.
You can deny as you wish, but people would call and say, John Skipper's coming to a game. You must do the following. It was parking. It was dealing with when you're being dropped off by a driver. We knew when you were in the building, we had like people would, it'd be an alert, like Skipper's here.
Think how much easier it would be now. You could just put a GPS on me and track me at all times.
I want to do a bit of cleanup on Isle Samson. So it is now the TD Garden, not the Boston Garden anymore. It is also true that we have proof as always.
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Chapter 6: What are the implications of high-value team sales?
Well, what's been happening, I am told, is that James Dolan no longer goes to these meetings. He is, of course, the control person, but he sends an emissary in his place who works for MSG and for him in a legal capacity. And that owner's representative, David, says, has been instructed to, it seems, vote against all of the stuff that everybody else wants to do.
Like, there's just reporting by me and now The Athletic indicating that James Dolan, what is the term for how he is functioning at these meetings? I want to say he's an obstacle, but what is the actual better term in your guys' view? An annoyance? He's the dissenter. He is his emissary. He's at the center of attention. Habitually dissents, I guess, is the reporting we can offer here.
But a dissenter is someone who does it with thought. And to me, what Dolan does is what Steinbrenner, George Steinbrenner was famous for this, John and Pablo. He would not go to owner's meetings. He only went to when Bud Selig would get his extensions. And the vote for his extensions, he would show up, vote, and that's it. No other meetings would he ever go to.
And the Yankees were famous back in George's day for voting no on everything. We do a motion on the floor that we're going to approve something so ridiculous that there's no way there's a dissent. Like we're going to approve the fact that Thursday comes after Wednesday or that we're going to do an owner's meeting in Milwaukee, let's say.
and there'd be a vote, and Yankees either no or they'd abstain. So we'd have to announce it as 29-1, or when Bud got really angry, he would just have the Yankees abstain, and it would be 29-0 with one abstention. but it means nothing. It's such a joke because there's no difference in baseball or basketball between 23 to seven and 30 to zero. They have the same exact impact on your business.
Now, if it's 22 to eight and Jimmy Dolan can find seven other clubs to vote with him in order to change how the NBA central office spends its money or to change how RSNs are treated, if you can get eight teams, you can actually make a difference. But Dolan, and can't get anyone to work with him.
I would argue that he still is a dissenter. You said that the requirement for that is that he puts thought into it. He is voting his own interest. It may not be aligned with the league's interest, but he has what has traditionally been a very lucrative regional sports network. It is one that is likely to survive significantly longer than most other regional sports networks. And he is simply...
In this case, I'm not discussing any vote because I'm not familiar with all the votes at the NBA. But at this case, he simply is at odds with what the rest of the league has decided is good for it, right? And that is the NFL is a national league. Everything is national, right? And that has been good for the NFL. The NBA has clearly decided they want to be a national league.
And I believe said on this program before that they are the league after the NFL most suited to have everything become national. So that's where they're headed. But that means they have to take games that have previously been regional games, local games, and make them national. And in most cases, those regional sports networks have disappeared. They're no longer significant drivers of revenue.
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