Want to Be LeBron’s Boss? 15% of Cavaliers Said to Be for Saleby
Gordon Gund said selling his piece of the NBA franchise
Cleveland team controlled by Quicken Loans founder Dan Gilbert
Billionaire venture capitalist Gordon Gund is selling his 15 percent stake in the Cleveland Cavaliers, who for the second year in a row are playing for the NBA championship, according to two people familiar with the situation.
The pro basketball franchise best known for four-time MVP LeBron James is worth about $1.1 billion, said valuations expert Peter Schwartz. The stake held by Gund, who owned the Cavaliers from 1983 to 2005, is worth as much as $160 million, said Schwartz, a presidential research scholar at New York University.
Gund, 76, and his late brother, George, sold their controlling interest in the team to a group led by Quicken Loans Inc. founder Dan Gilbert in 2005 for about $375 million. As part of the deal, Gund retained about a 15 percent stake. It’s not clear whether Gilbert has the right to approve prospective buyers, as is often the case in limited partnership sales.
Gilbert didn’t return an e-mail seeking comment. Cavaliers spokesman Tad Carper declined to comment. Gund is represented by BDT Capital Partners Managing Director E. Robbie Robinson, said the people, who asked not to be identified because neither the team nor Gund has disclosed the stake sale. Robinson didn’t respond to a request for comment.
NBA rules bar James, or any other player and those close to them, from purchasing stakes in teams. Any sale must be approved by the NBA.
The Cavaliers trail the Golden State Warriors 1-0 in the best-of-seven NBA Finals. It’s a rematch of last season’s championship, which the Warriors won in six games, and James’s sixth straight trip to the finals. Game 2 is June 5 in Oakland, California.
A championship would likely bolster the value of the Cavaliers, who have the highest payroll in the league. James, 31, is a free agent after the season, although he is widely expected to remain in Cleveland.
Unlike much smaller stakes in teams of about 1 percent to 2 percent, there wouldn’t be a significant discount applied to a 15 percent interest in a marquee franchise, according to Schwartz.
The Gund brothers bought the team from Ted Stepien in 1983 for about $20 million.