Donald Sterling's Punishment: Selling the LA Clippers for $2 Billion
Ever since the audio surfaced of Los Angeles Clippers owner Donald Sterling's lambasting his girlfriend (who will now and forever be known as "V. Stiviano") for her inclination to post pictures of herself with African Americans, namely Magic Johnson, on her Instagram account, the saga of "What will happen to the Clippers?" has been a roller coaster.
Shortly after NBA commissioner Adam Silver's decision to banish Sterling from the NBA and force a sale of his team, Sterling did an interview with Anderson Cooper that was just as meandering and nearly as offensive as the "V-Stiv" tapes. (Also, woefully uninformed on the difference between HIV and full blown AIDS.)
In the last week, Sterling at one point ceded control of the team to his estranged wife Shelly in hopes of a sale of the team, and then just days later sent a 32 page response to the NBA saying he would never sell the team.
All of this seemed to be the "work" of a man who was either being trampled by old age, by be a woeful lack of self awareness, or both.
Thursday night, for purposes of NBA fans, employees of the Clippers, and Adam Silver, it ceased mattering.
For Thursday night, as reported by ESPN.com, former Microsoft CEO Steve Ballmer had reached a signed agreement to purchase the Los Angeles Clippers from the Sterling family trust for $2 billion.
Yes, say it again -- TWO. BILLION. DOLLARS.
For those keeping track, that's the second highest amount for any North American professional sports franchise (the Dodgers $2.1 billion is still the record), and easily the highest purchase price for an NBA franchise, surpassing the Milwaukee Bucks $550 million purchase price from about a month or so ago.
This was Ballmer's second attempt at NBA ownership, as he was part of a group that attempted to purchase the Sacramento Kings last year and move them to Seattle. By all accounts, the Clippers will remain in Los Angeles, as Ballmer has said on the record that moving them would be detrimental to the franchise value.
As for winners and losers in this whole tribulation, some are more obvious than others.
The winners, as best I can tell, are:
1. The federal government Because Sterling paid around $13 million for the team back in the early 80's, the cost basis on a $2 billion windfall is almost nothing and Sterling will be forced to pay maximum long term capital gains tax on his profit, which means Uncle Sam has about $600 million coming in on this deal. I can't wait to see how they fuck up the use of it!
2. The National Football League There is currently no NFL team in Los Angeles. The last two professional sports franchises in Los Angeles to be sold are the Dodgers ($2.1B) and Clippers ($2.0B). Football is more popular right now domestically than either baseball or basketball. Do the math. A pigskin gold mine awaits.
3. Clippers sales reps On the heels of the Stiviano tapes, sponsors were climbing off of the Clippers' bandwagon in droves, awaiting the termination of Sterling as owner. Most of them climbed back on once Silver made his ruling to oust Sterling. I can only imagine the sponsorship salespeople having to go through cancellation hell again if Sterling had decided to try and hold on.
The losers, as best I can tell, are:
1. Radio hosts, bloggers, or anyone needing content A "Sterling vs NBA" trial for him to try to maintain ownership of the team would have provided numerous epic television moments, and in all likelihood, at least a few "Holy shit" stories about other NBA owners when it came time for the airing of the dirty laundry. A trial would have been Donald Sterling's personal Festivus. This blog was a HUGE loser yesterday.
2. Attorneys No trial means no legal fees, but I'm fine with this. Lawyers always win, I'm fine with them needing to go find somebody else to sue.
3. Donald Sterling We learned late Thursday night why he finally had to give in on the sale of his team:
Espn has learned that experts had declared Donald Sterling mentally incapacitated, leaving Shelly as sole trustee & power to sell the team— Ramona Shelburne (@ramonashelburne) May 30, 2014
Must be nice to be considered a "loser" on a transaction where you net out $1.3 billion in profit after taxes.
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