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Aubrey McClendon’s Oklahoma City Thunder Stake To Be Put Up for Sale

Scott Soshnick
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Aubrey McClendon’s Oklahoma City Thunder Stake To Be Put Up for Sale

(Bloomberg) -- Wanted: a new part-owner for the Oklahoma City Thunder, one of the most successful small-market NBA teams of the past decade. Requirements: patience while the team rebuilds its lineup.A 22% stake in the team -- previously owned by the late energy magnate Aubrey McClendon -- is available, according to people familiar with the situation. The sale will be run by the boutique investment bank Inner Circle Sports, said the people, who asked not to be identified because the process is private. The New York-based firm declined to comment.The deal comes at a time of transition for the Thunder. The team just agreed to a blockbuster trade that will send star Russell Westbrook to the Houston Rockets, ESPN reported on Thursday. The Thunder will get Chris Paul and draft picks they can use to build a new squad.The 22% stake has been held by McClendon’s estate since his 2016 death. The Chesapeake Energy Corp. co-founder perished in a single-car crash, which resulted in a number of creditor claims. Oaktree Capital Group LLC had put a claim on cash from a sale of the team stake, although the firm was repaid after the estate sold oil-and-gas leasehold interests in a separate transaction.Martin Stringer, an attorney for the estate, didn’t respond to messages requesting comment on the Thunder sale. Tom Blalock, the executor of the estate, and team spokesman Dan Mahoney also didn’t return messages seeking comment.The Thunder are worth about $1.5 billion, according to Forbes. That puts the small-market team in the middle of the pack of the NBA’s 30 squads, but the organization had been building momentum. It reached the playoffs in nine of the past 10 seasons, including the last four.Sellout StreakThe Thunder posted an average local television rating of 6.69 this season, second-best in the NBA behind the Golden State Warriors. They also have sold out 355 consecutive home games, which is the third-longest active run in the NBA.The team is controlled by Clay Bennett, whose group bought the club -- then the Seattle SuperSonics -- in 2006 for about $325 million. The team relocated to Oklahoma City for the 2008-2009 season.It’s difficult to pinpoint a value for McClendon’s stake, which comes with voting rights but few other perks, according to the people. There’s no representation on the board or decision-making authority. In such cases, buyers will often seek to apply what’s called a limited partner discount, taking into account the absence of control or a say in franchise operations. Such discounts usually range from 10% to 20%.There’s also the flux in the team’s roster -- and thereby its salary commitments -- which may affect the club’s valuation. The Thunder recently traded Paul George and his $33 million salary to the Los Angeles Clippers. Westbrook was in line for a $38.5 million salary next season.To contact the reporter on this story: Scott Soshnick in New York at ssoshnick@bloomberg.netTo contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net, Rob GolumFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

(Bloomberg) -- Wanted: a new part-owner for the Oklahoma City Thunder, one of the most successful small-market NBA teams of the past decade. Requirements: patience while the team rebuilds its lineup.

A 22% stake in the team -- previously owned by the late energy magnate Aubrey McClendon -- is available, according to people familiar with the situation. The sale will be run by the boutique investment bank Inner Circle Sports, said the people, who asked not to be identified because the process is private. The New York-based firm declined to comment.

The deal comes at a time of transition for the Thunder. The team just agreed to a blockbuster trade that will send star Russell Westbrook to the Houston Rockets, ESPN reported on Thursday. The Thunder will get Chris Paul and draft picks they can use to build a new squad.

The 22% stake has been held by McClendon’s estate since his 2016 death. The Chesapeake Energy Corp. co-founder perished in a single-car crash, which resulted in a number of creditor claims. Oaktree Capital Group LLC had put a claim on cash from a sale of the team stake, although the firm was repaid after the estate sold oil-and-gas leasehold interests in a separate transaction.

Martin Stringer, an attorney for the estate, didn’t respond to messages requesting comment on the Thunder sale. Tom Blalock, the executor of the estate, and team spokesman Dan Mahoney also didn’t return messages seeking comment.

The Thunder are worth about $1.5 billion, according to Forbes. That puts the small-market team in the middle of the pack of the NBA’s 30 squads, but the organization had been building momentum. It reached the playoffs in nine of the past 10 seasons, including the last four.

Sellout Streak

The Thunder posted an average local television rating of 6.69 this season, second-best in the NBA behind the Golden State Warriors. They also have sold out 355 consecutive home games, which is the third-longest active run in the NBA.

The team is controlled by Clay Bennett, whose group bought the club -- then the Seattle SuperSonics -- in 2006 for about $325 million. The team relocated to Oklahoma City for the 2008-2009 season.

It’s difficult to pinpoint a value for McClendon’s stake, which comes with voting rights but few other perks, according to the people. There’s no representation on the board or decision-making authority. In such cases, buyers will often seek to apply what’s called a limited partner discount, taking into account the absence of control or a say in franchise operations. Such discounts usually range from 10% to 20%.

There’s also the flux in the team’s roster -- and thereby its salary commitments -- which may affect the club’s valuation. The Thunder recently traded Paul George and his $33 million salary to the Los Angeles Clippers. Westbrook was in line for a $38.5 million salary next season.

To contact the reporter on this story: Scott Soshnick in New York at ssoshnick@bloomberg.net

To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net, Rob Golum

For more articles like this, please visit us at bloomberg.com

©2019 Bloomberg L.P.