When former Microsoft CEO Steve Ballmer's won an auction for the Los Angeles Clippers, his $2 billion bid shattered the previous record sale price for an NBA franchise, which was $550 million for the Milwaukee Bucks. Despite paying such an exorbitant fee for the team, Ballmer said in an interview with ESPNLosAngeles.com that he views the transaction as a "reasonable purchase."
When former Microsoft CEO Steve Ballmer won the auction for the Los Angeles Clippers, his $2 billion bid shattered the previous record sale price for an NBA franchise, which was $550 million for the Milwaukee Bucks. Despite paying the record-breaking fee for the team, Ballmer said in an interview with ESPNLosAngeles.com that he views the transaction as a "reasonable purchase."
ESPN.com obtained the Clippers' sale bid book, created by Bank of America, which estimated that the $2 billion sale price would be 12.1 times the team's expected revenue in 2014. Yet Ballmer said that compared to acquisitions he has made in the tech world, the Clippers purchase was not that unusual.
From the ESPNLosAngeles.com interview:
"Lots of people run lots of numbers," he said. "I feel like I paid a price I'm excited about. It obviously was a price that was negotiated, and I feel very good about it. It's not a cheap price, but when you're used to looking at tech companies with huge risk, no earnings and huge multiples, this doesn't look like the craziest thing I've ever acquired. It's my own personal money, and you're just as careful with your own money as you are with your shareholders' money.
There's real earnings in this business. There's real upside opportunity. So compared to the things I looked at in tech, this was a reasonable purchase and it's one I'm really excited about. Plus, I'm really excited about the product. I love it. I've been to over a hundred basketball games in the last year, and that's just high school games."
The sale was made official Tuesday. Ballmer is quickly becoming involved in basketball decisions, including reportedly planning to engage coach and president of basketball operations Doc Rivers in contract extension talks.
As part of the sale, Shelly Sterling, wife of former owner Donald Sterling, will retain courtside seats, VIP passes for games, titles of "Owner Emeritus" and "Clippers' No. 1 Fan" and three championship rings if the Clippers win an NBA championship.
- Alex Hampl