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24-Hour Fitness Founder Matrov 1 of 2 Finalists

The World Cup is down to two teams vying for the prize, and so is the candidates list of candidates to buy the Warriors franchise.

According to sources with knowledge of the negotiation, the four finalists groups submitted purchase of sale agreements with their offer. Two of the finalists groups were outbid and knocked out of the process. Warriors owner Chris Cohan, who hired Galiatoto Sports Partners to sell the franchise, could choose the winning bidder from the remaining two groups by August.

What is not reported in my story in today’s paper (I confirmed waaaaay after deadline) is that the group headed by CEO founder Mark Mastrov is one of the finalists, according to a source, who also confirmed that Mastrov’s bid topped $350 million. The other finalist?

Nothing I have been told leads me to believe Oracle billionaire Larry Ellison, the man everyone expects to end up owning the Warriors, is out of the mix. My reporter’s hunch is that he is one of the finalists. But I have not confirmed that.

I have previously reported the field was down to four finalists:

* a group headed by Oracle billionaire Larry Ellison

* a group led by former 24-Hour Fitness CEO Mark Mastrov

* a group headed by Texas-based Wall Street financier David Bonderman

* a group that includes Mandalay Entertainment chairman Peter Guber.

Who do you think is joining Mastrov in the finals?

Currently, one of the sources said, the remainig two purchase of sale agreements are being refined and tweaked. That process could include a revised offer. From what I’m told about the process, the bidders aren’t (supposed to be) aware of what opponents bid, so any revision of the offer would be based on how the purchase of sale agreement is tweaked or if the bidder thinks he needs to jump higher to get the franchise. After the purchase of sale agreement is finalized, Cohan will choose one and submit to the league to start the approval process.

Either way, one source said Cohan is extremely confident, even more than before, that the franchise will go for more than $401 million, which is the record price for an NBA franchise – set by Robert Sarver when he bought the Phoenix Suns.

One source said the six year, $80 million contract the Warriors gave power forward David Lee did not negatively impact the process. The bidding groups were informed of the process and none expressed concern about it. Some even liked it, a source said.

Marcus Thompson

  • whit

    “One source said the six year, $80 million contract the Warriors gave power forward David Lee did not negatively impact the process. The bidding groups were informed of the process and none expressed concern about it. Some even liked it, a source said.”

    Interesting and scary at the same time…

    This goes against the ‘throw the bums out’ mentality thats been floating around the team. If they don’t have a problem with the deal, does this mean that any of the management, (specifically Riley) has a chance to stay around?

    Just a thought…Just glad that the process is moving forward. Holding out hope that it gets done before the season starts. Lame duck situations are never good.

    good post marcus

  • Fierce South

    There should be a yacht race between the 2 finalists to decide the winner!

  • gmoney

    If we don’t match it, we will regret. It will seem like a bargain in 2 years. Just do it.

  • A’s in 2010

    Down to 2.. yeah right. Cohan isn’t eliminating anyone from the process, especially Ellison. He wants the most money he can get.

  • dan

    the good news is that the lee trade apparently did not stop/alter the ongoing sales. thanx Marcus.

  • Aaron

    Was Mastrov’s bid $350 for Cohan’s 80% share, or $350 million for 100% of the franchise?

  • John Starks

    I don’t mind if it’s Mastrov, but Ellison has the kind of public image that says “winner”. That would instantly catapult the W’s from a budget team to BAWSS status.

    As long as whoever it is doesn’t have tax trouble and is willing to hire someone with real basketball knowledge, I’m down. (I still hope it’s Larry)

  • MWLX

    Both of these groups — Mastrov and presumably Ellison — seem like they’d be a major upgrade from current ownership. Celebration time.

    “A’s in 2010″: So you’re selling your house and you DON’T want the most money you can get? What universe do you live in?

  • LarryDaMan

    Sounds like the other 2 bidders were never really relevant. Seems more likely Mastrov was brought in the bidding process just to drive the price up. If Ellison doesn’t win this for a “fair” price or decides to back out, it would be a disaster for the Warriors and the fans. Meh, what else is new?

  • A’s in 2010

    MWLX, learn to read you fool.

  • StephsMouthGuard

    Warriors in 2016!!!

  • jsl

    As one who used to negotiate deals not unlike this, there’re almost inevitable patterns always at play, and I can see what’s “most likely” happening here — even tho, from my vantage point, it’s all necessarily surmise.

    First, Bonderman and Guber were almost certainly pure stalking horses, ginned up by the broker to try to push the two “real” bidders — LE and Mastrov — higher. It likely worked to some extent with Mastrov — who cobbled together a $350MM offer (which the broker certainly wants out there in the ether — ergo MT’s column and blog) — while LE probably stood at around $315MM, knowing that Cohan would NEVER cut him out of the competition because he CAN pay the most.

    But Cohan (and Stern) would much rather have LE buy the team. (Biggest reason for Cohan: real money much sooner from a guy worth tens of billions; “financing” issues likely will cause some problems for Mastrov’s group.) And if LE HAS worked a deal with the minority owners he can cause Cohan a lot of legal headaches if Cohan tries to sell elsewhere. (No need to address these here — at least not yet.)

    So, while Cohan wants to maximize the sale price, unless the final bid difference is huge, I’d expect him to go with Ellison — tho his K with the broker (i.e. assuming brokerage fees are tied to sale price) could also cause problems if he decided to take a “lower” (face amount) bid, even though there were fewer — or no — strings attached.

    The key is that the broker now seems confident he’s pushed the sale price to about $350MM. (You might still hear a $400MM figure at the time a sale is announced, but my surmise would be that it would largely reflect weird “accounting” practices, and what people call “yonder” money — which comes in later, often MUCH later.) LE shouldn’t have to bid much above $350MM, if THAT much, because one can also surmise Mastrov probably put in close to his peak offer to get it up to $350. (And I suspect Cohan would ALWAYS give LE a “last” shot, anyway, if he’s got ANY brains left in that skull.)

    I’m guessing this continuing $400MM chatter is really just whistling past the graveyard: These guys are increasingly scared the price won’t go that high, and are trying to chat it up to that level with this “semi-open” process, leaking just the info they want out there. (For example, we’re NOT hearing much about how Mastrov’s bid is constructed, and whether any — or much — “yonder” money is involved.)

    Frankly, between the two (assuming I’m right on this), I’d much rather see LE get the team than Mastrov — especially if Mastrov’s group has to burn all their assets to acquire the team in the first place. Plus, I just don’t think Mastrov’s in Ellison’s league in the grey matter area. And, I conclude, that all this “leakage” is contrived for the purpose of maximizing an Ellison offer anyway. We’ll see soon enough.

    Finally, tho it’s also pure surmise, I wouldn’t put much credence in reports that no one had any objection to the Lee deal — and certainly not that anyone liked it (except maybe Bonderman or Gruber who’d thought it might drive the purchase price DOWN to a reasonable level). My sense is the LAST thing a guy like LE does is accept an invitation to become involved at this stage. He’s too smart for that, even if it means he’ll have a bigger hole (or holes) to fill after he acquires the team.

  • ZK

    Jsl,
    Thanks. That was very informative.
    I hope Ellison is the owner. Finally someone will bring life, personality and desire to win into at least one “yay” area team.

  • JimPunkrockford

    let me just say, i think a lot of people are having some “group thought” similar to what Jsl was saying, i don’t know where this comes from. i have posted links to stories about larrys financial situation, sure he is rich but he borrows most of his cash, he is paper rich, as most of his net worth is tied up in Oracle stock. financially Bonderman is the man with the loot, the dude has cash on hand. even Mastrov cashed in already. and as far as “smarts” goes, larrys well regarded as a hardcore sportsman but an intellectual light-weight. Mastrov started built and sold a company so he muct have something going on upstairs, the interviews i have seen of him seem like is is a competitive dude. Bonderman runs a hedge fund (read: is smart and competitive.)

    Peter Guber is the biggest douchebag on the face of the earth so, as a W’s fan, I’m sure will be our new owner.

  • TheLastWarrior

    Swingman Dorrell Wright to sign a 3 year deal with the Warriors…

  • kpc

    A’s In 2010 Says:
    July 10th, 2010 at 10:29 am
    MWLX, learn to read you fool.

    He seems to have understood perfectly. You, however, might want to give more thought to what the words spewing mindlessly from your mouth actually mean.

  • jsl

    LE’s not just paper rich.

    Want to guess how much Oracle stock he’s sold in the last year?

    (Hint: Far more than he needs to buy the Warriors.)

  • JimPunkrockford
  • JimPunkrockford

    “Larry Ellison, the founder of Oracle, lives like a king. But most of his wealth is tied up in Oracle stock. Mr. Ellison lives in part off loans”

  • Dre

    Ellison has the cash. He just dropped a few $Billions for Sun Micro. why pay cash for the dubs if he can get a loan to get it and make the revenue after paying off the loan. its a drop in the bucket.

  • sjbytes

    Mastrov will be just as bad as Cohan. Mastrov will be highly leveraged and won’t be able to spend money to get players. We should hope the “other party” wins the bidding.

  • JT the Bigga Figga
  • Squall

    Is Cohan going to televise “The Decision” for which owner it is?

  • lobo

    as with all franchises, the franchisor (yeah that the buyer) has a whole lot of rights and abilities written in the small print albeit we have not seen too many exercised in the world of sports…who do y’all think mr stern hopes to get the team??? obvious answer….ya’ think the small print has something in it about the net worth of the buying group and how much debt they can assume…..i think so and that is one of a host of reasons i will wager that ellison gets the team if he really wants it…..he will not overpay that i can assure everyone

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