NEW YORK (CBSNewYork) — A tech billionaire is on the verge of purchasing a 49 percent stake in the Brooklyn Nets, but he could take over controlling interest in the NBA franchise in several years.
ESPN reported Friday that Joseph Tsai, co-founder of the Chinese e-commerce giant Alibaba, has reached an agreement in principle to become a minority owner of the team. The deal includes an option to take control of the Nets in four years, the report said.
In the meantime, Mikhail Prokhorov, who bought the then-New Jersey Nets in 2010, will remain the team’s principal and operating owner.
Tsai will reportedly pay about $1.127 billion, based upon a $2.3 billion valuation of the franchise. The agreement does not include ownership of the Barclays Center, of which Prokhorov also owns a majority share.
Tsai, 53, was born in Taiwan and attended high school at the Lawrenceville School in New Jersey and college at Yale University, where he earned his undergraduate and law degrees. He played lacrosse and football in high school and is said to be an avid NBA fan.
Prokhorov bought an 80 percent stake in the then-New Jersey Nets in 2010, moved the team to Brooklyn in 2012, and took full ownership in 2015.
“As I’ve said, I’m passionate about owning the Nets and our emerging sports and entertainment businesses and will continue to look at growth opportunities,” Prokhorov said in a statement in December. “My goal in seeking a local minority partner is to further strengthen the team’s New York presence in order to expand upon our business and community relationships.”
According to ESPN, the Nets lost $23.5 million last season, more than any team in the NBA other than the Detroit Pistons. In 2013-14, Brooklyn lost $144 million — $100 million more than any other franchise.
Last season, the Nets had the NBA’s worst record (20-62) and ranked 28th of 30 teams in home attendance (15,429). This year, the team is off to a 3-2 start, which includes an upset of the defending Eastern Conference champion Cleveland Cavaliers on Wednesday night at the Barclays Center.