NEW YORK — Bank of America Corp. has been retained to sell the Los Angeles Clippers, whose owners face a June 3 deadline to reach a sale agreement or risk it being taken by the National Basketball Association, two people with direct knowledge of the situation said.
The people requested anonymity because the sale process isn’t public.
Jim Nash, a managing director at Bank of America, declined to comment. Pierce O’Donnell, the attorney for Shelly Sterling, wife of team owner Donald Sterling, didn’t respond to a message left at his Los Angeles office.
The NBA barred Donald Sterling, the team’s managing partner, for life for making racist statements and Commissioner Adam Silver said he would push owners to force a sale of the team.
Donald Sterling last week agreed to let his wife sell the club, according to people familiar with the matter, avoiding a potential legal battle with the league. The NBA agreed to let the Sterlings sell the club on condition that neither retains any equity, a person with direct knowledge of the matter said.
The NBA has set a hearing for June 3 where Donald Sterling has the right to address the other 29 owners. After that, 23 of 30 owners would need to approve a forced sale.
Shelly Sterling wants at least $1 billion for the team that finished the regular season with the third-best record in the league, a person with knowledge of the process said last week.
Chuck Baker, who heads sports mergers and acquisitions as a partner in DLA Piper’s Global Sports, Media and Entertainment practice, said the team might fetch as much as $1.5 billion.
“This will likely be the most hotly bidded sports asset since the Dodgers,” said Baker. “There are a number of strong buyers in the L.A. market that are both viable and eager for a trophy asset.”
The Los Angeles Dodgers were sold in a bankruptcy auction to basketball hall of famer Magic Johnson and Guggenheim Partners executives for a record $2.15 billion after former owner Frank McCourt’s proposed television contract was nixed by Major League Baseball Commissioner Bud Selig.
The Clippers, long overshadowed by the more successful Lakers, are a team on the rise. While the Lakers missed the playoffs this past season, the Clippers reached the second round, where they were beaten by the Oklahoma City Thunder. The Clippers are led by All-Stars Blake Griffin and Chris Paul, who is also president of the players’ association.
Among the possible bidders are music executive David Geffen, whose group includes Oracle Corp. Chief Executive Officer Larry Ellison and Oprah Winfrey.
Also interested are former Live Nation Entertainment Inc. Chairman Irving Azoff and former Lakers star Johnson, who has said he would explore a Clippers bid with his Guggenheim partners. Former Microsoft CEO Steve Ballmer is also interested, according to ESPN.
Shelly Sterling, Bank of America officials and a representative of the Sterlings real-estate business have been meeting with potential buyers, a person said.
Like the Dodgers — who started regional sports network SportsNet LA and secured an $8.35 billion contract with Time Warner Cable — television opportunities are driving some of the Clippers’ valuation.
The Clippers’ local television contract with Fox’s Prime Ticket expires after the 2015-16 season, which aligns with the expiration of the league’s agreements with ESPN and ABC, and TNT. The networks combine to pay about $930 million a year, a figure that might at least double as channels fight for live content coveted by 18 to 34-year-olds and advertisers.
Locally, the Clippers are the only major pro team whose TV rights will be open for bidding anytime soon. Fox needs the team for Prime Ticket, which lost both the Dodgers and Lakers when they became the centerpiece of SportsNet LA, which has English and Spanish versions.
The Milwaukee Bucks, who play in the No. 34 television market, last month were sold for $550 million. Los Angeles is the No. 2 market behind New York.
“Never have I seen more billionaires and people with incredible wealth line up to look at a team than with this one,” said Andrew Kline, founder of Park Lane, a sports investment bank.
With assistance from Erik Schatzker in New York.