With the news that Alibaba vice chairman Joe Tsai is set to acquire a 49% stake in the Brooklyn Nets, here’s a closer look at the newest sports team owner on the block and his reasons for joining the NBA’s exclusive club.
If you thought China was supposed to be cracking down on sports deals, it’s worth noting that Joe Tsai is not your average “Chinese” sports owner. Born in Taiwan, he went to boarding school in the US before studying at Yale. He’s now a Canadian citizen, which means that this deal won’t be subject to some of the same regulatory hurdles that have, for example, slowed the acquisition of European football clubs by Chinese investors in recent months. But most other “Chinese” buyers would be subject to this scrutiny, especially if they were looking to buy a NBA franchise that could be worth in the $2-3 billion range – far more than the majority of soccer clubs that Chinese investors have snapped up over the past couple of years.
This could change in the future as the regulatory landscape shifts once more, or if the government becomes less concerned about capital outflows, but that’s how it looks right now. Additionally, Tsai – whose fortune is currently estimated at more than $9 billion (just fractionally more than his future co-owner Mikhail Prokhorov) – likely has much of his wealth outside of China, since Alibaba is listed in the US (NYSE: BABA), so the outflow issue wouldn’t apply even if the other restrictions did.
So just who is Joe Tsai and why does he want an NBA team?
That boarding school referred to above is the prestigious Lawrenceville School in New Jersey, which in addition to producing some well-known names in the politics and business worlds – such as former Disney CEO Michael Eisner, former Honduran President Ricardo Maduro and former White House Press Secretary Jay Carney (who would have been one year behind Tsai) – also has a very strong sports tradition. Notable alumni include New York Knicks center Joakim Noah and New York Islanders prospect – and the anointed savior of Chinese ice hockey – Song Andong.