L.A. Clippers Sold to Steve Ballmer for $2 Billion
UPDATED: Both the former Microsoft CEO and the wife of disgraced owner Donald Sterling confirmed that a deal had been reached to sell the team.
Former Microsoft CEO Steve Ballmer is buying the Los Angeles Clippers for $2 billion.
The news came following weeks of speculation on the fate of the team, after owner Donald Sterling was banned for life from the NBA following the emergence of an audio tape in which Sterling is heard making racist remarks.
Both Ballmer and Donald Sterling's wife, Shelly Sterling, who's been handling the sale of the team, which she owns through a family trust, released statements confirming they'd reached a deal for the former Microsoft executive to buy the NBA franchise.
Shelly said that she'd signed a binding contract for Ballmer to buy the team.
"I am delighted that we are selling the team to Steve, who will be a terrific owner," Shelly said in a statement. "We have worked for 33 years to build the Clippers into a premiere NBA franchise. I am confident that Steve will take the team to new levels of success."
Ballmer added: "I will be honored to have my name submitted to the NBA Board of Governors for approval as the next owner of the Los Angeles Clippers. I love basketball. And I intend to do everything in my power to ensure that the Clippers continue to win -- and win big -- in Los Angeles. LA is one of the world's great cities -- a city that embraces inclusiveness, in exactly the same way that the NBA and I embrace inclusiveness. I am confident that the Clippers will in the coming years become an even bigger part of the community. I thank Shelly Sterling for her willingness to entrust the Clippers franchise to me, and I am grateful to NBA Commissioner Adam Silver and his colleagues for working collaboratively with me throughout this process."
Indeed, Ballmer's purchase still has to be approved by the NBA, but if the sale goes through he will have paid the highest-ever price for an NBA team.
The previous record was set last month with the sale of the Milwaukee Bucks for $550 million. Donald bought the Clippers in 1981 for $13.5 million.
On Friday, NBA spokesperson Mike Bass said in a statement: "Commissioner Silver has consistently said the preferred outcome to the Clippers proceeding would be a voluntary sale of the team. Shelly Sterling advised the NBA last night that an agreement had been reached with Steve Ballmer, and the NBA Advisory/Finance Committee met via conference call this morning to discuss these developments.
"We await the submission of necessary documentation from Mrs. Sterling. In the meantime, the June 3 special meeting of the NBA Board of Governors remains as scheduled," he confirmed.
"Ballmer was chosen over competitors that included former NBA star Grant Hill, Los Angeles-based investors Tony Ressler and Steve Karsh, and a group that included David Geffen, Oprah Winfrey, Larry Ellison and executives from Guggenheim Partners, according to The Los Angeles Times.
Shelly's statement noted that she made the deal "under her authority as the sole trustee of The Sterling Family Trust, which owns the Clippers." Donald Sterling's attorneys contend that he is a co-owner and therefore must give his assent for the deal to go through. They also say he won't be giving it.
"Sterling is not selling the team," said his attorney, Bobby Samini. "That's his position. He's not going to sell."
Dick Parsons, the former Time Warner CEO and chairman of Citigroup, who was named interim CEO of the Clippers earlier this month, told KTLA, "I hope this thing goes through, as soon as it is resolved, the better for everyone -- the team, the family, the players, the staff.
"I know Steve [Ballmer] from my days at Time Warner. He is a good honorable man. He clearly wants into this league and he paid a knockout price."
When asked if he thinks Sterling will take the matter to court, Parsons replied: "I think it is a possibility -- I hope that doesn’t happen. I hope rationality prevails… you have a price on the table that is the highest that will ever be paid for a team. I hope that someone is able to bring that to Donald's attention."
Ballmer beat out rival bidders after presenting an "all-around superior bid," according to an individual with knowledge of the negotiations. The individual, who wasn't authorized to speak publicly, said Ballmer made more than an hour-long personal visit to Shelly Sterling's Malibu home Sunday and laid out his plan.
"He knocked their socks off, they bonded, had a good connection," the individual said. The amount was also the largest of the offers, and Ballmer was one potential buyer to deal with rather than numerous members of a group.
Though Donald Sterling's attorneys now say he won't agree to sell the team, a May 22 letter obtained by The Associated Press and written by another of Sterling's attorneys that says that "Donald T. Sterling authorizes Rochelle Sterling to negotiate with the National Basketball Association regarding all issues in connection with a sale of the Los Angeles Clippers team." It includes the line "read and approved" and Donald Sterling's signature.
Samini said Sterling has had a change of heart primarily because of "the conduct of the NBA." He said NBA Commissioner Adam Silver's decision to ban Sterling for life and fine him $2.5 million as well as to try to oust him as an owner was him acting as "judge, jury and executioner."
"They're telling me he should stand back and let them take his team because his opinion on that particular day was not good, was not popular?" Samini said. "It doesn't make sense. He's going to fight."
It's unclear how the agreement will affect the special hearing of NBA owners planned for Tuesday in New York to consider the charge against Donald Sterling for damaging the league with his comments. A three-quarters vote of the 30 owners to support the charge would have resulted in the termination of both Sterlings' ownership of the franchise. The deal is expected to be presented to the league before Tuesday, according to the individual.
Silver has said his preference would be for the franchise to be sold rather than seized -- and that means sold in its entirety, with neither Sterling retaining a stake. Though according to the deal's terms Ballmer will own 100 percent of the team, Shelly Sterling may continue to be involved under conditions worked out privately with Ballmer, the individual said.
Magic Johnson, whom Sterling singled out as someone he said he didn't want at Clippers games in the recorded audio that surfaced, praised Ballmer's purchase of the team on Twitter.
This is not the first NBA franchise that Ballmer has shown interest in. He was part of the effort to bring an NBA team back to Seattle following the move of the SuperSonics to Oklahoma City to become the Thunder in 2008.
Ballmer stepped down as CEO of Microsoft earlier this year.
The Hollywood Reporter has reached out to the Clippers for comment.
Earlier on Thursday, Donald Sterling's lawyer Maxwell Blecher indicated that the Clippers owner would take a litigious route toward a forced sale.
"Mr. Sterling is not going to consent unless the NBA does something about the illegal charges they have filed against him, and so far we've heard nothing to indicate that will occur," Blecher said on CNN.
A spokesperson for Geffen confirmed to THR that his group had withdrawn their bid for the team.
Guggenheim Partners also owns THR.