Shortly after LeBron James left, the Los Angeles Lakers were sold for 84.9 billion.
At the end of July, LeBron James announced that he would play for the Philadelphia team with a two-year, $8 million contract. On the Los Angeles side, the management has pinned more of its future on Luka Dončić. LeBron's 8-year tenure with the Purple and Gold Dynasty has come to an end.
Shortly after the trade closed, Joshua Kushner, founder of the renowned U.S. venture capital firm Thrive Capital, and Bob Iger, former CEO of The Walt Disney Company, plan to acquire the Los Angeles Lakers of the National Basketball Association (NBA) from TWG Global at a transaction valuation of up to $12.5 billion (approximately 84.3 billion yuan), which is expected to set a new record for global professional sports team transactions.
Sources familiar with the matter said the deal still requires approval from the NBA Board of Governors, and Kushner's affiliated investment platform also needs to complete due diligence.
According to another report from Titan Sports, Joshua Kushner and Bob Iger issued a joint statement stating that they are deeply honored to have the opportunity to become the owners of the Los Angeles Lakers, one of the most iconic sports franchises in the world.
Converted at the central parity rate of the RMB on that day, the transaction is valued at 84.9 billion yuan. This is the most expensive team control transfer in the history of human professional sports, a quarter higher than the record set 10 months ago. The creator of that previous record is exactly the seller in this deal.
Mark Walter only received unanimous approval from the NBA Board of Governors on October 31 last year to take over the Lakers from the Buss family for $10 billion. His ownership of the team lasted barely longer than a full NBA season played by LeBron James. According to reports, the entire deal was negotiated in less than 72 hours, with no prior rumors or bidding processes, and Walter was not publicly listing the Lakers for sale at the time.
From $67.5 Million to $12.5 Billion
Kushner and Iger were not originally targeting the Lakers.
Their previous target was Las Vegas. In March this year, the NBA Board of Governors officially approved research on adding expansion teams in Las Vegas and Seattle. The league hired investment bank PJT Partners to evaluate the market, arena infrastructure and acquisition teams, and the outside world expects the bidding price for the two new teams to be between $7 billion and $10 billion.
Kushner and Iger had already hired an investment bank to prepare a controlling stake offer of $8 billion to $10 billion, and were considered one of the two leading bidders. The problem is that this sum of money would only buy them a piece of paper: the team logo needs to be redesigned, fans need to be recruited from scratch, arena leases need to be negotiated, and the team roster has to be assembled one by one through the expansion draft, with the first year's revenue only a forecast.
Moreover, the Las Vegas arena would also need to be built by themselves, costing approximately $2.5 billion.
Spending $10 billion on an expansion team and another $2.5 billion to build an arena adds up to $12.5 billion. So why not just buy the Lakers directly for $12.5 billion? For the same total amount, the Lakers come with 11 championship titles, the second-largest media market in the United States, $551 million in existing annual revenue, and a team logo that requires no explanation to anyone.
After the news broke, U.S. sports business media FrontOffice Sports received feedback from multiple team owners that their phones were flooded with calls, and everyone thought it was one of the most bizarre things they had ever seen.
Walter also agreed very quickly. The transaction still needs to be voted on by the NBA Board of Governors, and Kushner's Thrive Eternal has not yet completed the due diligence process. The Buss family will retain approximately 15% of the equity, and Jeanie Buss will continue to serve as the team's manager.
Let's go back to May 1979. Jerry Buss paid Jack Kent Cooke $67.5 million, buying not just the Lakers, but also the Los Angeles Kings of the NHL, The Forum arena, and Cooke's 13,000-acre farm in California.
A month later, he used the first overall pick in the draft to select Magic Johnson, and won the championship in his first season as owner, kicking off the "Showtime" era. Buss once said at the time that his goal was to make the Lakers transcend regional identity, so that New Yorkers, Chicagoans and Bostonians would also root for the Lakers when watching games. He never ran just a team, but a show staged in Los Angeles.
Less than 10 years after taking over the team, he ran into a cash flow problem.
Some players asked him face to face whether he had ever thought about selling the team. According to ESPN reports, Buss replied that if he sold the team, he would become extremely rich, then sit at home wondering what to do with all that money, and the thing he wanted to do most was buy the Los Angeles Lakers. More than 30 years later, most of his six children voted in favor of cashing out to lock in the gains.
46 years, 11 championship titles, the value rose from $67.5 million to $10 billion, an increase of nearly 150 times. Excluding inflation, the Buss family's net profit from this transaction is about $9.93 billion, with an average annual rate of return of 11.7%.
Walter, who took over the team, was not a random outsider.
He is one of the founders of Guggenheim Partners, chairman and CEO of TWG Global, and holds equity in the Dodgers, Los Angeles Sparks, Chelsea FC and the Cadillac F1 team. The $700 million 10-year contract signed with Shohei Ohtani in 2023 also came from him.
In 2021, he and Todd Boehly bought 27% of the Lakers' shares from Anschutz at a valuation of $5.5 billion, and took over Anschutz's preemptive right to the remaining shares. So last year's controlling stake acquisition was less of a surprise attack than a pre-planned exercise of rights.
14 months later, the book value of the equity increased by $2.5 billion.
The $12.5 Billion Arithmetic Problem
According to Forbes statistics, the Lakers generate $551 million in annual revenue. $185 million of that comes from local cable TV and streaming platform Spectrum SportsNet, another approximately $110 million comes from national broadcast revenue shares of ABC/ESPN, NBC/Peacock and Amazon, and the rest comes from tickets, sponsorships, merchandise and non-event revenue of the arena. Dividing $12.5 billion by $551 million gives a price-to-sales ratio of about 20 to 22 times. Sports business media 4th Quarter once conducted an industry comparison, showing that the average multiple of NBA teams is around 13 times; the Celtics, which also do not own their own arena, have a premium of only just over 1 time.
What does a 20x price-to-sales ratio mean? NVIDIA, Datadog and Snowflake are roughly in this range.
It can also be calculated in reverse. If Walter wants to sell at $12.5 billion at the same multiple as when he bought the team, the Lakers' revenue needs to rise by 24% in one year. The estimated growth rate from fiscal year 2024 to fiscal year 2025 is 7%.
So this is not a discounted cash flow problem. What the buyer is paying for is not a multiple of profits, but a unique coordinate that cannot be replicated. To put it more plainly, the value of the "Los Angeles Lakers" brand itself has exceeded the value of the business under it.
The more troublesome part is that this high premium is highly dependent on a loosening contract. Last season, Spectrum SportsNet paid the Lakers $192.1 million, which is scheduled to rise to $218.1 million by the 2028-29 season; by contrast, the New York Knicks' revenue from the same item is only $106.6 million. And Charter Communications hired LionTree back in October 2025 to explore selling this TV network. The prerequisite for a successful sale is that the Lakers are willing to accept lower copyright fees. The huge premium of the Lakers over the Celtics almost entirely comes from this pillar.
The regional sports network business has already collapsed across the United States.
San Diego accepted a roughly 20% revenue drop, and Houston swallowed a drop of more than 30% after AT&T SportsNet went bankrupt. The NBA itself is also adjusting its expectations, and the league has lowered its salary cap forecast for the 2026-27 season. The buyer is paying a multiple of more than 20 times for high-margin revenue that could shrink by one-third at any time.
On the seller's side, there is another set of accounts.
According to reports from The Wall Street Journal and Bloomberg, the Manhattan U.S. Attorney's Office and the U.S. Securities and Exchange Commission are investigating the flow of approximately $16 billion in loans - these funds were lent to companies related to Walter and TWG Global, and through third-party entities, they finally appeared on the books of two Delaware life insurance companies he holds. The focus of the investigation is whether these related party transactions were fully disclosed to insurance regulators and whether they constitute fraud. Last September, the FBI executed a search warrant on a private plane at an airport in Chicago, seizing Walter's mobile phone and laptop, a detail that was not known to the public until the end of July this year.
In June this year, Delaware Life revised its financial statements. Previously, the outside world believed that such related party loans accounted for about 3% of its loan portfolio, and the revised figure is close to 42%.
Bloomberg published a follow-up report after the Lakers transaction news came out: TWG Global has been in contact with multiple investment institutions, hoping to introduce external capital to reduce the insurance company loans that have attracted the attention of the Department of Justice, and the sale of the Lakers is expected to greatly accelerate this process. Another person familiar with the matter told the media that in order to acquire the Lakers last year, Walter pledged a large number of assets and collaterals, and once the team is sold, these assets will be released.
TWG's response is that Walter and the company have always acted in good faith, are cooperating with relevant departments, and believe that these matters will be properly resolved.
It should be noted that the federal investigation itself does not constitute any determination of illegal conduct, and no one has been criminally charged so far. But the timing is so obvious that it can hardly be read as a coincidence. On the same contract, the buyer is paying for the brand that will still exist a hundred years later, while the seller is making arrangements for immediate liquidity.
VC Firms Start Buying Sports Teams
The institution that took over the team is best known for its investment in OpenAI.
Joshua Kushner is 41 years old this year, with a net worth of about $5.2 billion. Thrive Capital he founded invested in Instagram, Spotify and Stripe in the early stage, and is an important shareholder of OpenAI. He also co-founded the insurance company Oscar Health, and previously held minority equity in the Miami Heat and Memphis Grizzlies.
This year, he set up a new vehicle called Thrive Eternal, which uses a perpetual capital structure - no fixed duration, no exit schedule, for buying and holding sports teams and what he calls "other iconic brands" in the long term. Its first transaction was a minority stake in the San Francisco Giants, and the second is the controlling stake of the Los Angeles Lakers.
Bob Iger's resume needs little introduction. In March this year, he stepped down as CEO of The Walt Disney Company for the second time, passing the baton to Damaro; earlier, he and his wife Willow Bay became controlling owners of the National Women's Soccer League club Angel City at a valuation of $250 million in 2024. During his tenure at Disney, he was in charge of ESPN, and he also negotiated several multi-billion dollar broadcast contracts with the NBA.
Kushner once wrote a manifesto-like statement for Thrive Eternal, the gist of which is: Some assets have qualities that technology cannot replicate, they are rooted in traditions, identities and shared experiences; in a world where intelligence is extremely abundant, creation is infinitely expanded and distribution is highly fragmented, such assets will only become more important. Translated into investment language, that means artificial intelligence is shortening the life cycle of almost all business models, and scarcity premiums should be given to targets that cannot be killed by technology.
Over the past three months, he has made three consecutive moves.
In June, he participated in the Las Vegas expansion team bidding. In July, he approached FIFA - the organization plans to put commercial rights such as World Cup broadcast and sponsorship into a newly established subsidiary, and sell up to $4.2 billion in equity at a valuation of $20 billion. Thrive Eternal was directly named as the lead investor, without any formal bidding process. This deal was called off on July 31, as opposition from continental football associations outweighed the offered capital. In August, he targeted the Los Angeles Lakers.
The accounts of the first two deals actually make sense. Las Vegas has clear samples of relocation premium: the Raiders' valuation tripled in six years, and the Golden Knights' value rose from a $500 million expansion fee to $2.1 billion eight years later. As for the FIFA deal, measured by the revenue multiple of comparable assets, the implied valuation can reach $600 billion, three times Kushner's entry price. Only the Lakers deal seems overpriced no matter how you calculate it.
Unless this deal is never meant to be settled within a lifetime.
The events that took place in the same time window can be connected into a clear line. After acquiring Arctos, KKR disclosed that this sports-focused institution's first two funds have invested $4.7 billion, with a net internal rate of return of about 22%, and its portfolio includes the Buffalo Bills, Golden State Warriors, Paris Saint-Germain and Fenway Sports Group. Apollo injected $2.6 billion into the parent company of the New York Yankees. The San Diego Padres changed hands for $3.9 billion, setting a new MLB record. Jeff Bezos appeared on the list of consortia bidding for a minority stake in Liverpool FC.
Changes on the institutional side are the fundamental reason. The new NBA broadcast cycle starting from the 2025-26 season is 11 years with a total of about $76 billion, while the previous contract was 9 years for $24 billion. If expansion and the 2027 fall NBA Europe league are both implemented, conservative estimates say this will bring a total of about $20 billion in revenue to the 30 existing team owners, at least $65 million per team - and this sum will not be counted as basketball-related income, so no part of it needs to be shared with players.
In other words, the way team owners make money is shifting from running the team well to selling their equity well.
In the New York Times DealBook interview about the Apollo and New York Yankees deal, sports investment banker Sal Galatioto said a widely quoted line: if he had to bet, the New York Yankees would still exist 100 years later with a higher probability than Apple. This sounds like a joke, but it is a very serious statement in asset allocation - when technology compresses the business cycle to less than 10 years, assets that can withstand a 20-year, 50-year holding period have become scarce resources.
The S funds, continuation funds and patient capital that have been discussed in China's primary market in the past two years are essentially the other half of the same problem: how long can capital be deployed, and what kind of assets are worthy of such a long holding period. Kushner's answer is cultural scarcity.
Whether this answer is right will probably not be known until a hundred years later, but the market has already paid the money in advance.
This article is from the WeChat official account "Rongzhong Finance" (ID: thecapital), author: Wang Tao, editor: Wuren, published with authorization from 36Kr.