Miriam Adelson, the matriarch of the Adelson family, along with her son-in-law Patrick Dumont — the Sands Corp. president and COO — confirmed in a statement released Wednesday they are in the process of purchasing a majority share of the Dallas Mavericks from current owner Mark Cuban.
The statement reads in part:
“The Adelson and Dumont families have entered into binding purchase agreements to acquire majority ownership and the right to serve as Governor of the Dallas Mavericks.
“The families are targeting a closing of the transaction by year-end, subject to satisfaction of customary closing conditions and approval of the NBA Board of Governors.... The goal is to win and to have a team that proudly represents the greater DFW area and serves as a strong and valuable member of the local community.”
What does this sale mean for the Mavericks and its fans? Let’s explain the deal and what we know right now.
• The Adelson and Dumant families will be the team’s majority owners, with Patrick Dumont serving as the team’s official governor in dealings with the league office.
• Cuban will retain a “significant share” of the franchise and — most importantly to him — continue to have a say over the basketball operations side of the business. Marc Stein summed this up in his Substack newsletter, looking in detail at the sale:
Cuban “has certainly granted more front-office autonomy to general manager Nico Harrison than many initially expected and has likewise relished that Mavericks CEO Cynthia Marshall has run the business side since her arrival in February 2018... League sources say he is determined to operate as a very active partner to the Adelsons on the basketball front while happily letting them focus on the pursuit of TV money, real-estate plays for the franchise, their continued efforts to lobby Texas lawmakers to legalize gambling, etc.,”
• That last sentence explains what this is for the Adelson/Dumont/Sands Corp. side of things — this is about a potential real estate deal for a casino in the greater Dallas area (something Cuban talked about in the past as well). Suppose the Sands wants to build a massive resort and entertainment/casino complex in or around Dallas. In that case, it needs an anchor outside of gaming (that is, if gambling and sports betting were ever legalized in Texas, those things are currently illegal). An arena with the popular Mavericks as the primary tenant would be that anchor. It is not much different in concept from the real estate moves made by other NBA owners using an arena as an anchor and foot traffic generator for an entertainment/housing complex around the building.
• This sale does not mean the Mavericks could move to Las Vegas — that is not happening. NBA commissioner Adam Silver has made it clear that the NBA will take up expansion — and let’s be honest here, almost certainly will expand — once the new television rights deal is in place next year. Las Vegas is considered one of the prime locations for an expansion franchise (along with Seattle, which is a lock to get one). It is expected in league circles that the Fenway Sports Group — which owns the Boston Red Sox, the Liverpool Football Club of the Premier League, and a group that counts LeBron James among its investors — will get the Vegas franchise. The expansion fees for the two new clubs will likely bring in more than $6 billion to the NBA and there is zero chance the league’s owners will allow the Mavericks to move to Las Vegas and cut off that expansion market.
Besides, as noted above, this is a Dallas real estate play for the Adelson family, which has already invested big in lobbying the Texas legislature to allow gambling in the state.
• The valuation of the franchise at $3.5 billion for this sale may be below full market value for this team — Forbes estimated the team worth at more than $4 billion, and the publication has generally been on the low side of franchise valuations for sales — but it suits Cuban because of the unique features of this sale allowing him to keep a hand on the basketball side.
• Why sell now for Cuban? It could be as simple as finding a deal that fits his needs: He keeps his hand on the part of the business he cares about, meaning he’s still involved with players and the basketball side, while cashing out. He bought the team for $285 million 23 years ago and is now getting out at $3.5 billion — that’s an insane return on investment.
It also could be that Cuban sees an uncertain long-term market for sports broadcast rights fees beyond the next 5-10 years, and has decided to get out now before the bubble bursts. The NBA is riding that bubble with the broadcast rights deal it will announce in 2024 (in whatever form that takes), but Cuban has expressed concern previously about the deal after that one.
“This is a massive red flag… I think Mark Cuban is looking and saying, ‘This is the bubble, and the bubble is about to burst.’”@DarthAmin explains why Mark Cuban selling a majority stake in the Mavs is a giant red flag ahead of the NBA negotiating its next rights deal. 🚩… pic.twitter.com/kfusXi8y6L
— Oddball w/ Amin Elhassan and Charlotte Wilder (@oddballhoops) November 30, 2023
All of that is speculation about what Cuban is thinking, but he’s not the only one around the league wondering how long this rights bubble will last in a streaming age — how will most fans consume NBA content a decade from now? Nobody knows, but it will be different from the cable-based model that drove the sport for decades.
• What will this sale mean for Mavericks fans? There likely will not be many changes in the short term. You can be sure the Adelsons will be willing to pay up to keep Luka Doncic — the star attraction for the franchise — when the time comes. He’s the big name that brings in fans, and if the plan is to use the Mavericks as the anchor of a new development the new owners will do everything they can to keep Doncic in a Mavericks uniform. In the next decade or so, the sale could mean a new arena, likely not near downtown Dallas where the team plays now. However, that will all take time to play out.
