41

Warriors Could Be Sold Soon, and for Record Price

By now you’ve heard the Warriors are actvely looking to sell. They have hired Galatioto Sports Partners to sell the franchise (think of it like a real estate agent hired to sell a house). This has been in the works for some time. But it came out today because Street & Smith’s Sports Business Journal broke the story, prompting the Warriors to send out this  release.

******************************

WARRIORS RETAIN GALATIOTO SPORTS PARTNERS TO CONDUCT SALE OF TEAM

Leading Sports Advisory and Finance Firm Has Participated In More Than 70 Major Sports Transactions

OAKLAND, Calif. – The Golden State Warriors of the National Basketball Association (NBA) have retained Galatioto Sports Partners (“GSP”) to conduct a sale of the Team, it was announced today.  GSP, acting as the Club’s exclusive financial advisor, will manage all aspects of the sales process.  As such, all related inquiries should be made directly to GSP.

Neither the Warriors nor GSP anticipate making any further public comments regarding the sales process until and unless a definitive agreement on a transaction is reached.

The Warriors, currently majority-owned by Christopher Cohan, are a premier NBA franchise located in the San Francisco Bay Area, the fifth-largest market in the NBA.  The team plays its home games in Oakland, California, at Oracle Arena.

Galatioto Sports Partners, the leading sports advisory and finance firm, specializes in providing investment banking and innovative financing solutions to the global professional sports market.  GSP was established in early 2005 by Salvatore Galatioto.  The principals of the GSP have acted in a variety of capacities on more than 70 transactions in the major North American and European sports leagues.

****************************************

Obviously, information about this is flying around. The first name on every one’s tongue is Larry Ellis, the Oracle billionaire who has been linked to the team forever. (One team source told me they are absolutely convinced Ellison will buy the team and is determined to. Was even willing to bet.) But the game has changed a bit, as the Warriors’ confession today has shown.

I’ve been told by multiple people that $400 million is actually low in regards to what the Warriors want. Banking on the fact that this is the fifth-largest market and it’s really unknown how big the Warriors could be if they ever win, Cohan is looking at possibly getting upwards of $500 million. Sounds crazy, right? Well, I keep hearing he’s going to at least come close. That would require Ellison upping his price, which I have always heard at $350 or below (though hasn’t made an official offer, the Warriors once contended).

That seems ridiculous, considering a few things: the economy; they are 31 games under .500 and up against the cap; they have been the postseason once in 15 years; Forbes just placed the value of the franchise at $315 million back in December, before the Warriors’ season went completely awry; it is known Cohan wants to say, which figures to take leverage away from him; it is going to take a lot of work to turn this thing around (lot of firings and hirings, and buyouts and image building).

With that said, there is definitely confidence that Cohan – who bought the team for $119 million in 1995 – will cash out at some fairly surprising number.

I’m told 24-Hour Fitness founder Mark Mastrov has thrown his name in the mix. My colleague, Tim Kawakami, who was all over this a long time ago, said there are as many as six interested parties. That helps Cohan’s cause tremendously. All he needs is a bidding war to drive the price up. Just the hint of other buyers figures to drive the starting price up. (If you want to buy the owners, how does knowing Ellison is the front-runner influence your initial offer.

Another surprising element: some in the front office this thing can be done immediately. Obviously, it is all contingent upon Cohan getting the price he likes. But if that happens, the Warriors can at least come to an agreement with someone soon. Why does that matter? Because a pending ownership change impacts the moves the Warriors make this offseason.

From what I’m told, the Warriors are carrying on as if the ownership stuff is not happening. But if the new owner is pegged before the draft or July 1, when the free agency period begins, the Warriors will be maneuvering with the new boss looking on, no doubt consulting. So, if the new guy loves Monta Ellis and doesn’t want him to be traded, then that probably wouldn’t happen.

But what if no deal is reached by then? Can you take on another contract? Can they draft for Nellie’s system though the reality is that Nellie ball and his style of play may not be here?

Obviously, this is all speculation. No one knows what Cohan is thinking or what he really wants. Not even the guy he hired to run his franchise.

For your perusal, here are some excerpts from the article by John Lombardo, which can be read in full on Sports Business Journal’s website:

Recent NBA team sales cannot be considered robust deals. The Charlotte Bobcats just sold for roughly $275 million, less than the $300 million Bob Johnson paid for the expansion team in 2003. But the Warriors’ price could surpass the NBA-record $401 million sale of the Phoenix Suns to Robert Sarver in 2004, said Marc Ganis, president of SportsCorp Ltd.

***

… the Warriors are committed to playing in the arena through the 2016-17 season. Terms of the lease call for the Warriors to pay a base rent of $1.5 million and about $700,000 a year from the team’s $30 million, 10-year naming rights deal with Oracle Corp. that expires in 2016. In addition, the Warriors pay a share of parking, premium seat and concessions revenue to the county, up to a maximum of $7.4 million a year.

***

Sal Galatioto, president of Galatioto Sports Partners, confirmed that the company has been retained by the team, but would not comment further. Galatioto Sports most recently represented Johnson in his deal to sell the Bobcats to Michael Jordan. The company also represented the Ricketts family in its recent purchase of the Chicago Cubs for $845 million and is representing Tom Hicks in his sale of the NHL’s Dallas Stars.

Marcus Thompson

  • http://warriors.realgm.com/articles_archives.phtml Daniel Leroux

    Marcus,

    You accidentally typed Larry Ellis instead of Larry Ellison right after the press release.

    My off the cuff and unconnected analysis on the substance of the matter: The biggest issue is that no one knows what Cohan’s price is. I don’t think he’s going to get a bidding war, he’ll get a group of people that are willing to pay a much smaller amount and once the price gets above that line, he’ll be left with Larry and possibly one or two others.

  • thenab90

    Please God let Larry Ellison hurry up and buy this team!

  • Hook Mitchell

    I wonder how much comission this company gets to broker the deal.

    1% of $400 billion is …….$4 billion right?

    10% of $400 billion would be $40 billion?

    Astronomical figures

  • Owen

    Hook Mitchell – it’s millions of dollars not billions. Still I wouldn’t mind it.

  • Whack-A-Dub

    Hurray, Stephen Curry will not be underrated forever because he is under bad management and the team sucks!! Huzzah.
    Please Larry. You’re the only one we want to buy this train wreck of an organization.

    Marcus, is this the first positive post in 14 years or what? this post deserves an award

  • Whack-A-Dub

    Thank god Larry is the only one that could match 500mil and not commit suicide out of regret…though he would probably pay it up with bloo-”Oracle” money…

    Cmon, Larry Legend, we’re waiting

  • nate

    The firm most likely gets a fixed price fee (probably not more than a million dollars)

  • Pingback: » Blog Archive » Cohan hangs the “FOR SALE” sign on Warriors’ HQ, but how much will he get?

  • Pboss

    Love this!

    MT, didn’t Larry Riley say to you before the trade deadline that the W’s are at a disadvantage because they are are not a big market team? How is a top 5 market (which they are now using as a big selling point for a new buyer) not a big market? They have known they are sitting on a NBA gold mine and have done nothing with it…. thank goodness its almost over!

  • thenab90

    man just think when larry ellison steps into the oracle fans are gonna treat him like a rock star!

  • Squall

    I got 5 on it to get Cohan out.

  • dan

    uncle larry just sits and waits for the best offer then he will swoop in for the kill ala the Sun deal. He waited for Sun and IBM to talk and talk but finally they could not agree on a price, boom Oracle got Sun. You watch, Larry will submit some low ball offer, 350mil or so then wait for the other guys if in fact they exist. Does Larry really want it? Thats the question we don’t know yet..

  • Dubfan

    To hook Mitchell – it’s $500 million, not billion. No doubt a tidy commission nevertheless, but there’s a rather substantial difference between the 2 figures.

  • Pingback: SLAM ONLINE | » Who Will Buy the Golden State Warriors?

  • Whack-A-Dub

    Hurray, we might see the end of this! Hopefully they are not partenering just to sell tickets for next year, but if they aren’t,great! The first Bay Area team to stop sucking. Hell, the third Cali team to not suck since Magic Johnson & the Chargers.

  • Whack-A-Dub

    Hurray, we might see the end of this! Hopefully they are not partnering just to sell tickets for next year, but if they aren’t,great! The first Bay Area team to stop sucking. Hell, the third Cali team to not suck since Magic Johnson & the Chargers.

  • Whack-A-Dub

    what the hell?

  • Hari

    Hire an editor please.

  • mb

    Whoever buys this sad team should move them back to SF (if possible) and lose the stupid “Golden State” name. San Francisco Warriors sound right.
    Of course we could also lose them to San Jose to join the Niners –YIKES!

  • Whack-A-Dub

    It’s the Tug-O-Warriors: who can Cohan rip 200 extra mil out of? Only time will tell…

  • Hook Mitchell

    Yeah my bad $400 million not $400 billion

    (Slap myself)

    so that makes it semi-quazi-astronomical figures?

  • Whack-A-Dub

    tug-o-warriors

  • Whack-A-Dub

    Haha Riley, “It won’t affect who we draft or our belief in this team”…is that seriously your last words Riley? Seriously, your job is gone, buddy. Have fun with Cohan’s enormous debt.

  • mrutta

    Please tell all fans to NOT renew season ticket purchase until Cohan has sold.

    There is no better way to make sure Cohan sells than to send a message to someone like Cohan, greed and squeezing profits out of the Warriors is what Cohan is all about.

    Please, please, please. Why is Cohan selling, he needs the cash and he is trying to get more than the team is worth. All potential buyers want fans and when they buy they can if they chose offer what Cohan is offering now, reduced pricing for a period of time.

    Cohan out is what all fans should be concentrating on now.

    Why do you think Cohan would offer reduced pricing right now if you renew your tickets other than he needs and wants the cash. Please, please, please.

  • E_CULB

    Whoever the new owner is please do whatever it takes to get the CIF state championship games back in Oakland!!!

  • dubfan

    If Ellison does buy the team, look how much he’s going to save on the use of Oracle name by not having to pay himself for that privilege.

  • http://www.animalhiphop.com Animal

    Wow there are a ton of typos in this post. Hard to read.

    But this is awesome news!

  • Usually Lurking

    @17

    I think the City of Oakland and/or Alameda County owns the arena and Oracle’s deal is with the city/county for naming rights (aka advertising).

    Oracle does not own the arena, so as I understand it, owning the Warriors and buying naming rights are two separate deals.

  • thenab90

    COME ON LARRY (ELLISON) BUY THIS TEAM!!!!!! YOU WILL BE A BAY AREA ICON/LEGEND!!!!!!!!!!!!!!!!!!!!!

  • Whack-A-Dub

    NOBODY BUY SEASON TICKETS!!! WAIT FOR NEW OWNERSHIP!!! DO NOT BUY THEM NOW!! THAT’s WHAT COHAN WANTS!!

  • Brian

    DING DONG! THE WITCH IS DEAD! OH HAPPY DAY! Hopefully Robert Rowell will leave with the deal. Don’t let the door hit you on the way out.

  • GSW_Hoops

    Watch the guy leverage Season Ticket renewals and then back out of the sale of the team.

    Christopher Cohan is one of the sleaziest people in pro sports ownership history. And that is really saying something.

  • TownLove

    Excited about a possible new owner. Not excited about the possibility of blowing everything up and starting over. Although I would love to see Rowell out the door. I like Riley and Nelly and hope the new owner keeps them around in some capacity. We’ll see.

    BTW, I cant see anyone out bidding Ellison. The guy has to big of an ego to allow that to happen.

  • Perry

    Don’t forget that Chris Cohan is a Jew….

    Jews are known for their shrewd business sense…..

    This is not a stereotype, it’s an actual fact…

    Anyway, regarding Ellison, I don’t know how committed he really is.

    I just don’t know enough about the situation or his intentions.

    My only hope is that if he DOES come in, that he makes ‘winning’ a top priority. I hope his head is in the right place. Owning a professional sports franchise is a different ballgame all-together.

    The Maloofs and Mark Cuban have been very successful in providing a complete overhaul of their respective organizations. If Ellison does come in, hopefully he follows the examples of the owners in Sacramento and Dallas……

    When the Los Angeles Dodgers’ O’Malley family sold the Dodgers to Rupert Murdoch and Fox back in the mid 90′s……..it never helped the Dodgers reach any further than the divisional playoffs…..

    They got some big names like Garry Sheffield and big name managers like Davey Johnson, …..but Murdoch never truly learned how to run a sports franchise. He was a savvy media tycoon,……..but not as savvy as a pro sports team owner.

    You guys wouldn’t know shit about that though….because you guys are all Giants fans……..

    Let’s hope Ellison has his ducks in a row…..

    First things first:

    He has to get rid of Don Nelson. Don Nelson has again destroyed this franchise with his favoritism and his persecution of certain players. He is too involved in personnel decisions and he’s too fat, old and drunk for that…….

    Send that fat Scandinavian back to Sweden.

    Bring in some legitimate basketball minds: Byron Scott, Tom Thibodeau, Jerry West….whatever….just get me a Coach with a legitimate offensive and defensive philosophy and players that can fit that philosophy and a GM that knows personnel.

  • Hook Mitchell

    Whatever happens…

    I just want the warriors to STAY IN OAKLAND.

    Hearing talk about a new owner possibly moving the team is FRUSTRATING

    I hope talks bout moving is all speculation.

    My herrera impersonation:

    FALSE RUMOR MONGEROR

  • Harp’s Dubs

    @Perry – your basketball insights are usually on point. KEEP YOUR CULTURAL/RACIAL OPINIONS TO YOURSELF. There’s no place for that stereotyping/prejudicial/hateful garbage on this blog!

  • TownLove

    Amen Harp. Its unnecessary and it doesnt have anything to do with anything.

  • Whack-A-Dub

    I thought we all hate Cohan here. If this isn’t a Warriors blog, I want to know where one is.

  • Whack-A-Dub

    NOBODY BUY ANY TICKETS!! AT ALL!! DO NOT FEED INTO COHANS TRAP!! UNLESS YOU WANT HIM TO BE HERE FOR ANOTHER 5 YEARS

  • Hook Mitchell

    I don’t HATE Cohan.

    But when he bought the team, that was when warrior players STOPPED visiting/volunteering at schools in West Oakland.

    With Fannie Mae and her family they were contantly in our neighborhood.

    I do think it’s time for a change of ownership
    Fans just had enough of him to say the LEAST.

    He signed big money checks for questionable contracts.

    Jason caffey
    Danny fortson
    Derek fisher
    adonal foyle

    He was willing to spend $$$ on players
    but he had the WRONG people in charge making decisions for him

    that is his fault. Only himself to blame.

    Whatever happens

    KEEP THE WARRIORS IN OAKLAND

  • robert rowell

    enough with the “Golden State” hate. it is most unique moniker for any pro franchise.

    “Oakland Warriors” sounds lame compared to it. i’m all for moving the team out of the hell hole that is the 880 corridor, but even San Francisco Warriors doesn’t have the ring the Golden State does. why we don’t rep that on our jerseys i’ll never understand. but it is the realest.

    “i’m the golden state heavyweight carrying the belt,
    I’m a one man army i don’t need no help.” -X to the Z.