In the last 72 hours, the Boston Celtics have been one of the protagonists of the NBA world. Since Monday, they have announced the extensions of Jayson Tatum, who signed the largest contract in NBA history ($313.9 for 5 years), and Derrick White ($125.9 for four). And taking advantage of the noise, It has been made official that the franchise’s majority owners are going to sell the team. The NBA champion and team with the most titles in the history of the league is up for sale in a process that will begin at the end of 2024 and is scheduled to end by 2028. An operation that will break all records seen in American sport and that has a financial reasoning behind it. Because these Celtics are going to be, next year, the most expensive roster in NBA history.
Because with the renewals of Tatum and White, together with the contracts of Jrue Holiday, Kristaps Porzingis and the supermax of Jaylen Brown, which began this week, Boston is expected to pay more than $900 million over the next five years. Guaranteed money for the core of the team that secured the 18th banner for the franchise. Brad Stevens has understood the new CBA regulations and made all the moves before they began to apply, thus allowing his free agents to renew without restrictions. The only condition was that the owners agreed to pay the fine for exceeding the luxury tax: a fine that could reach $250 million next year alone.added to the $225 million that the squad will cost.
For context, the highest amount Boston has ever paid in luxury tax was $69 million, the 2022/23 season, and The record in the NBA was broken by the Warriors this year ($176 million, though the Suns are expected to pay nearly $200 million this year). Boston would combine the two figures and that money, the luxury tax, comes directly out of the owners’ pockets. There is a mathematical formula for calculating the fine and every five million it goes up, but with one addition: Teams that have paid tax three of the last four years are considered repeaters, and therefore, the penalty is greater. That penalty increases next year, further affecting the Celtics, who will have to pull out their checkbook if they want to keep their team.
And this is the chart, comparing what it will be like in 2025 and 2026, without the contracts of rookie Baylor Scheierman this year or the renewals of Al Horford, Sam Hauser and Luke Kornet next season. There are about five contracts missing, where each dollar represents at least $7.75.
Wyc Grousbeck and his group of investors purchased the Boston franchise in 2002. The price, at the time, was $360 million, which was a record at the time. Just 22 years later, Forbes has valued the Celtics at $4.7 billion, and that’s before the ring or the new TV deal. That’s a 1,200% increase. And some sports business specialists say the final figure should easily exceed five billion and even reach six billion. Far from, for example, the money that Mark Cuban took home ($3.5 billion) or the $4 billion that Mat Ishbia paid for the Phoenix Suns and Mercury in 2023. And as much as Grousbeck is a Celtics fan, that’s a lot of money.
It’s not the only reason to sell now. As others have done, Cuban, the owners of Milwaukee or even Michael Jordan in Charlotte, some experts believe that the value of franchises will stop growing exponentially, although in the next few years a new television agreement worth $76 billion will be signed or two new teams will arrive. Selling at the peak of value, with Boston a champion and before the new luxury tax structure kicks in, allows Grousbeck and the other departing owners to avoid being blamed for not paying up. Something that Stan Kroenke is being accused of doing in Denver, for example, for failing to retain key pieces of the former championship team.
It is still too early to know which potential candidates there are to buy the franchise, but it is certain that a very wealthy investor or capitalist group will be needed. And the trend in the NBA is for new owners to arrive with full coffers. The Adelson family, which bought the Mavericks, is worth $35 billion (to Cuban’s $5.4 billion), Mat Ishbia is worth eight times Robert Sarver and the Bucks’ new owners have four times the value of previous owner Marc Lasry.Most of them arrived at the beginning of the century and have seen how the values of the franchises have multiplied without restraint, and it is a good time to sell.. According to Forbes, there are only 627 people with a net worth of more than 5 billion, so it won’t be an easy task to find the right person.
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2024-07-04 06:43:46
#champion #sold
