Steve Ballmer to buy Clippers for 2 Billion dollars - Page 3
Old 06-01-2014, 01:16 AM   #41 (permalink)
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This is probably the 3rd worst business decision ever made. The first was windows ME. The second was Microsoft not buying apple when it had the chance.

What an ass-hat. There is no way this franchise/building provides any kind of return on investment that is reasonable for 2 billion dollars.
ms was in no position to buy apple, they had so save them just so there is some competition, or else they may have been broken apart like at&t,

2 billion is fairly insane in terms of pure business, but less insane than 500m for milwaukee. The clips have a real chance to dominate LA basketball for the next decade and juding by the ridiculous money the lakers make in local tv deals, there's going to be some serious profits there.

no the flip side, if beats audio is worth 3 billion, the clippers price tag seems a bargain ...
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Old 06-01-2014, 01:28 AM   #42 (permalink)
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The leafs alone are worth more than the knicks on forbes. And they we just sold for a billion dollars. And they make a shit wack more money. And what do they knicks ahve to do with the clippers or MLSE?
Knicks would get 2 + Billion easily if they were put up for sale. Especially now
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Old 06-04-2014, 06:56 PM   #43 (permalink)
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More to my point on valuation:

Onswipe
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Old 06-04-2014, 08:13 PM   #44 (permalink)
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More to my point on valuation:

Onswipe
Just curious, what does it matter what the team is actually worth? A brick and mortar valuation is not in play here as everyone knows he overpaid to outbid everyone else and ensure he gets that team. It really is relative, to you and me it's like buying a house for a market value of $1,000,000 when it was built for $300,000. The house is worth $300,000 to replace and that's it's brick and mortar value to banks and builders but the market value really is what people are willing to pay at that point in time. Reality is he overpaid - think he cares? He's worth 20 billion and he used 10% of his net worth to acquire a team of which there are only 30 of and he will pass it on down to his family and heirs - increasing his exclusivity in an already exclusive club - which has another Microsoft billionaire. Not like he's hurting for coin and not like he doesn't have a multitude of other investments. He will eventually earn his money back and more in time - maybe not his lifetime but he didn't buy it for that imo.

One last point, the team has a lease for what, 8-9 years left at Staples center? At that point he could just build another arena in LA (as he promised to stay there and the league said so - so far) thus increasing the profits of that team - not like LA isn't big enough for 2 arenas.

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Old 06-05-2014, 12:49 AM   #45 (permalink)
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The economy is such that there aren't a lot of great investments right now. Everything is very competitive. Everything is low returns or small deals. When you have $20 billion dollars, it's probably really hard to diversify that money and find places to invest it.

Let's say he makes 20MM on his 2B investment per year, that's only a 1% return annually...but when you look at the value of NBA franchises and how much they've increased recently, it's a very attractive place to park his money.

The Business Of Basketball - Forbes

The capital appreciation is attractive, actually it's ridiculous, where else can you get a 25% increase in value?. The rich are getting richer, so if you can park you money in an exclusive game, 10 years from now it's going to be even more exclusive and the value will even be crazier.

The point is - Steve Ballmer didn't get $20B dollars by just spending because he can. He's most likely going to make money on his investment. But he also probably doesn't care much if he doesn't. He probably wants to win a NBA championship.

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Old 06-05-2014, 12:57 AM   #46 (permalink)
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More to my point on valuation:

Onswipe
So that is Sterling's own valuation at a court hearing regarding a discrimination lawsuit where he is likely to pay fines? (I'm guessing). I wonder what his own valuation is behind closed doors when he's selling to a prospective buyer? Close to $2B probably?

These guys aren't two hosers negotiating the price of a 2006 Dodge Grand Caravan. $2B was probably the right price.
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Old 06-06-2014, 05:19 PM   #47 (permalink)
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Now's a great time for Paul Allen to sell the Blazers. Good teams sell for big bucks.

as long as the team doesn't move to Seattle in 2 years of course.
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Old 06-06-2014, 11:47 PM   #48 (permalink)
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bill gates probably wishes now that he didn't donate 50+ billion dollars in the past 20 years, with all that money he could have bought all nba franchises and turn the league into WWW-Mania (the basketball version) with the champions picked on facebook via fan voting
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Old 07-24-2014, 04:07 PM   #49 (permalink)
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Another argument to support what I've been saying about Clips' valuation:

Bid Book Reveals Severe Overpay For Clippers By Ballmer - RealGM Wiretap

I know the whole thread is kinda moot at the moment, but sometimes I just can't understand these business people...
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Old 07-24-2014, 04:11 PM   #50 (permalink)
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Originally Posted by MikeToronto View Post
Another argument to support what I've been saying about Clips' valuation:

Bid Book Reveals Severe Overpay For Clippers By Ballmer - RealGM Wiretap

I know the whole thread is kinda moot at the moment, but sometimes I just can't understand these business people...
Don't forget that they got Shelley to sign off on accepting all legal costs that will come via Donald. That probably required a good bit of the overpay to get done.
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Old 07-24-2014, 04:54 PM   #51 (permalink)
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The accountans would have worked this out. Ballmer probably payed a million dollars alone in fees to consultants just for this transaction. Any overpay due to a the sentimintality of owning a basketball team would have been a small percentage of that $2B figure.
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Old 07-24-2014, 06:56 PM   #52 (permalink)
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Yeah, yeah, but have you read that "No team in the history of sports has sold for six times total revenues"?!

That's across all sports! That means that at 12.1 multiplier he has easily overpaid by 100% even if we assume that Clippers have the biggest potential to increase earnings across all the sports franchises ever sold!

Sorry, but this is some crazy shit...
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Old 07-24-2014, 07:31 PM   #53 (permalink)
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That's just one way to determine value. If you throw a capitalization rate of 5% on that $100,000,000 income stream, that is your $2B dollar value (5% is aggresive). But it's a unique market and obviously each purchase is a unique situation on to it's own so I don't think any simplified valuation model is going to be very accurate.

Really, I think the only way to say he overpaid is how much less of a price could he have bought the team for. If a second party was willing to pay $1.9B, I don't think you can say he overpaid. He paid what he needed too to get the team.

If he paid $2B and everybody else was around $1B, he overpaid quite significantly.

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Old 07-24-2014, 07:32 PM   #54 (permalink)
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Originally Posted by MikeToronto View Post
Yeah, yeah, but have you read that "No team in the history of sports has sold for six times total revenues"?!

That's across all sports! That means that at 12.1 multiplier he has easily overpaid by 100% even if we assume that Clippers have the biggest potential to increase earnings across all the sports franchises ever sold!

Sorry, but this is some crazy shit...
What does it matter? Just money to him, a thing to play around with and toy with....he has a few more billion. We should look at it relatively - like an old sought after car that there are only 30 of and 1 is for sale, 10 guys bid and all can easily over pay for it. The car is worth 100,000 but it's bought for 200,000 - same thing. Someone really wants, there are only a few that are ever sold in ones lifetime and he can afford it. In the case of the Clippers, the buyer just happens to be able to afford 2,000,000,000. That's more cheese than I'll ever see but to him? Meh...chance to join an exclusive club.

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Old 07-24-2014, 07:33 PM   #55 (permalink)
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Also - you notice in that onswipe link Sterling's value is $300m in a court hearing in 2009, and now in court he's claiming he could have sold it for $2.5B.
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Old 07-24-2014, 07:51 PM   #56 (permalink)
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http://a.espncdn.com/pdf/2014/0723/Exhibit_43.pdf

That's the link to "project claret" which was completed by Merrill Lynch. The multiple is actually 7x when adjusted for forecasted earnings based on the future tv contract negotiations.
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Old 08-12-2014, 11:15 PM   #57 (permalink)
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Steve Ballmer officially new owner of Los Angeles Clippers - ESPN Los Angeles

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The Los Angeles Clippers officially have a new owner.

Steve Ballmer's bid to purchase the Clippers closed Tuesday after the entry of an order by a California court confirmed the authority of Shelly Sterling to sell the team on behalf of the Sterling Family Trust, the league announced.
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Old 08-13-2014, 09:15 AM   #58 (permalink)
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Great to see Ballmer officially get the Clippers. Very happy that Sterling is now gone
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Old 08-13-2014, 12:13 PM   #59 (permalink)
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It's about damn time.
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