In late February, Boston experienced a sudden cold snap.
In the president's office at the New Garden, Lin Qi stood in front of the tactical board, his gaze sweeping over the top teams in the Eastern Conference before finally settling on the very bottom of the standings— the New Jersey Nets.
With a record of 12 wins and 45 losses, they are unsurprisingly at the bottom of the Eastern Conference.
Looking at this dismal record, Lin Qi knew very well that he had completely changed the fate of this team. In his memory, the Nets were originally supposed to trade Stephen Marbury for Jason Kidd this season. Kidd would use his playmaking ability to revitalize this lousy team and even make it to the NBA Finals for two consecutive years.
But now, Kidd has been traded to the Los Angeles Lakers by Lin Qi. And the Nets, unable to find a suitable home to trade Marbury, have no choice but to keep him on the team. The team's internal chemistry is a complete mess, not only has their record plummeted, but their arena is also practically empty.
There was a knock on the door, and Harvey, Lin Qi's personal advisor and a top M&A lawyer, walked in and placed a financial briefing on the table.
"Boss, things aren't going well in New Jersey." Harvey poured himself a cup of hot coffee and sat down on the sofa. " The Nets ' parent company, the YankeeNets, is preparing to spin off the team and put it up for sale."
"Because of the impact of the dot-com bubble bursting?" Lin Qi walked to the sofa and sat down.
"Yes, that's the most fatal reason." Harvey pointed to the data on the briefing. "The major shareholders of the YankeeNets suffered heavy losses in the tech stock crash of the past two years, and many of them were already struggling financially. They were hoping the Nets could perform well and sell more tickets to supplement their revenue."
Harvey shook his head and continued, "As a result, the Nets are currently at the bottom of the standings, and the attendance at Continental Airlines Arena is less than half full. Local fans simply aren't buying tickets. The team isn't only not making money, but it's also facing huge losses, completely becoming a bloodsucker for its parent company. The major shareholders have already had a huge argument at the board meeting, and they have no choice but to sell the team to cut their losses."
Because of their extremely poor record and the parent company's urgent need for funds, the team's current valuation is very low, making it an excellent time to sell.
Lin Qi picked up his coffee cup and asked casually, "Now that it's listed, who's currently bidding?"
"Three companies are quite interested," Harvey reported, flipping through his notebook. "The first is Bruce Ratner, a Brooklyn real estate developer. He's actually buying the team to acquire land. He wants to use the guise of building a new arena to develop a large commercial real estate project in Brooklyn, and then move the team from New Jersey to the area."
"The second consortium was led by Charles Kushner and New Jersey Senator Corzine. They played the political card, promising that they would never relocate the team and would remain in New Jersey after buying it, but their offer was not high."
"And the third one?" Lin Qi asked.
"The third bidder was a man named Charles Wang. His offer was around $260 million, slightly lower than Wang Jialian 'Ratner."
Upon hearing the name, Lin Qi nodded. "Give me a brief introduction to this person."
"The founder of Computer Associates was a first-generation Chinese immigrant who built his business on software. He is also the current owner of the New York Islanders, an NHL ( North America Professional Hockey League ) team," Harvey explained. "He has a very straightforward personality and a very tough style. After buying the Islanders, he was very enthusiastic about the players, but he didn't follow the usual methods in team management. He even fired a senior general manager in just forty days due to disagreements."
"Why is he bidding against the Nets?" Lin Qi asked.
"Because of territoriality," Harvey explained. "If Ratner buys the Nets, he'll definitely move to Brooklyn and build a new arena, which will directly take away the Islanders ' market share in Long Island, New York. Wang Jialian has a very strong personality; he doesn't want to see a real estate developer encroaching on his territory. Besides, he has indeed always wanted to own another NBA team in New York."
After hearing Harvey's description, Lin Qi had a better understanding of the situation.
Ratner's offer came close to $300 million, and he promised to move the team to Brooklyn, which aligns better with the league's desire to develop the big New York market.
David Stern has always wanted to expand his business empire in New York, Ratner's " Atlantic Ocean Yards real estate project" is a huge pie in the sky, capable of bringing long-term ticket and broadcast revenue benefits to the league.
In contrast, while Wang Jialian is financially powerful, he lacks a strong foothold on the NBA board. He hasn't owned the Islanders for long and while he has a decent reputation in hockey, he's considered an outsider in basketball. Coupled with his outspoken and uncompromising nature, many established owners in the league aren't fond of him. If it comes down to bidding terms and political connections alone, Wang Jialian is unlikely to win against Ratner.
But Ratner is a pure real estate developer who uses the team as a tool to acquire land. If he succeeds, Brooklyn will not only become a tough opponent, but the league's power structure will also be further controlled by these Wall Street old money guys who are involved in real estate and finance.
In contrast, although Wang Jialian is somewhat inexperienced in management, he is a boss who is genuinely willing to spend money, passionate about sports, and has low communication costs. I can help him fill in the gaps in his skills.
Lin Qi thought for a moment.
Funds can be packaged as joint development projects or joint venture funds for commercial real estate. Wang Jialian holds a number of high-quality commercial real estate resources in Long Island and Queens. By injecting funds into his company under the guise of real estate investment, he has sufficient cash flow on his books to acquire the Nets, thus avoiding the league's scrutiny of directly injecting funds into team ownership.
This approach bypasses the league's oversight blind spots. As long as Wang Jialian buys the team himself, he will be the sole major shareholder in name only. As for how he manages the cash flow behind the scenes, Wall Street's financial firewall can erase all traces.
It's not just about money, it's also about connections.
Wang Jialian is prone to stubbornness in team management, often firing executives over minor disagreements. The solution is to recommend a truly knowledgeable professional manager who understands basketball operations and can help stabilize the team after the trade is finalized, thus avoiding unnecessary detours. This way, he can acquire the team without making a mess of it.
Thinking about it this way, Wang Jialian is indeed an excellent partner. Rather than letting a real estate developer who doesn't understand basketball and only cares about building houses cause trouble in the Eastern Conference, it's better to help Wang Jialian acquire the team. This way, not only can you do him a favor, but you can also find a trusted owner ally in the Eastern Conference who can support you in many things in the future.
" Harvey, prepare the private jet itinerary, and while you're at it, cancel all my appointments for tomorrow," Lin Qi said bluntly, putting down his coffee cup.
"What do you mean?" Harvey paused, taken aback.
"I'm going to Long Island to meet this Mr. Wang in person."