Stakes in the National Basketball Association (NBA)’s ruling franchise Golden State Warriors could be up for the grabs. A group of investors in the franchise are looking to sell a five percent equity stake of the NBA’s team amid financial losses endured in the wake of the Covid-19 pandemic.
According to New York Post, Warriors’ investors are seeking $200 million for 5% stake which would give the NBA team’s valuation of $5 billion. This valuation would make the Golden State Warriors the most valuable NBA franchise.
Due to the pandemic, franchises across the sports are having excessive losses. There is no matchday revenue as fans are not allowed in arenas. The Warriors are losing about 50 percent of their expected revenue due to the pandemic. The franchise is in horrendous shape as they are maintaining the highest payroll in the NBA, while losing money off tickets, parking, concession stands and cash flow from the arena.
The identity of the sellers is undisclosed as such information is more than often not unveiled until an auction is done. It is believed that the largest stakeholder, Joe Lacob is not involved. Lacob is the Chief Executive and Co-executive Chairman of the Warriors with a 35% stake in the team.
Last November, San Francisco city officials did not allow 50 percent attendance in the arena and post that Lacob stated, the Warriors could lose $400m in revenue if they were to play this season without any fans at home games. As per the fair-market value, Golden State Warriors were second-placed with the total value at $5.21 Billion. If the data stands correct, the NBA franchise generates about 40 percent more than its previously projected annual revenue.