Recent sales indicate Timberwolves value increasing, owner says
Minnesota Timberwolves owner Glen Taylor said his team almost certainly is worth more than the $430 million listed by Forbes Magazine in January, based partly on the recent sales of NBA teams that continue to drive up franchise values.
Taylor spoke Friday before the NBA announced approval of the sale of the Los Angeles Clippers for $2 billion to former Microsoft CEO Steve Ballmer.
Taylor said the Timberwolves’ value likely was more affected by the recent sales of the Sacramento Kings ($534 million) and the Milwaukee Bucks ($550 million) than the scandal involving Clippers owner Donald Sterling and the forced sale of the team.
“The Milwaukee sale, again, I think there were four strong bidders in that, that probably pushed it up more than what Glen Taylor thought it might go for,” he said. “It pushed up the value, which was good for the Timberwolves.
“What it’s probably telling you right now is that there’s more buyers out in the market than there are teams for sale.”
Taylor, the interim chair of the NBA’s board of governors, has been at the center of the political storm involving Sterling, whom the NBA is trying to oust following recordings that were made public in which Sterling made racist remarks.
Taylor also expanded on reports that he was considering selling at least a minority interest in the Wolves. Taylor purchased the franchise in the early 1990s for $88.5 million.
Taylor, who also has a purchase agreement to buy the Star Tribune, the state’s largest media outlet, said he is interested in selling a minority interest in the team, with the understanding that a new partner eventually might take over the team.
“We’re looking for somebody to come in as a partner, but not that Glen Taylor is going to go out,” he said. “It’s a different type of sale than where (former Milwaukee Bucks owner) Herb Kohl just sold the club.”
Added Taylor: “We have no financial reason to do it, or a rush to do it.”
In its latest rankings, Forbes listed the Timberwolves’ value at $430 million, and ranked the team 26th out of the NBA’s 30 teams. Forbes said the Timberwolves had $116 million in revenue — the New York Knicks, the top-valued team, had $287 million in revenue. The business magazine also said the Wolves had a $2.7 million operating loss for the 2012-13 season, one of four NBA teams that Forbes said posted operating losses.
The Bucks, before the team’s sale, were last among NBA teams in value in the Forbes’ rankings, at $405 million.
Richard Painter, a professor of corporate law at the University of Minnesota, said even though NBA teams seem to be drawing more interest from buyers, owning a team still has to make financial sense.
“Having the teams go for more money is great,” he said. “But, ultimately, the value’s going to be driven by whether it’s a successful business or not. There are only so many people who, for ego, are going to go buy teams and then (expect to) lose money.”
Painter, a onetime adviser to President George W. Bush, said Taylor’s ownership of the Timberwolves — buying for $88 million and now having the team worth at least $430 million — is “a pretty good investment. (It’s) nothing outlandish. He would have been better off investing in Microsoft or Apple.”