The NBA will reserve the right to buy back the Milwaukee Bucks from incoming owners Wesley Edens and Mark Lasry if a deal to a build a new arena in the city is not in place by November 2017.
ESPN.com reported that sources said the sale agreement announced last week to transfer the Bucks from longtime owner Herb Kohl to Edens and Lasry for $550 million includes a provision that allows the league to buy back the team for $575 million if construction on a new building in Milwaukee is not underway by the deadline.
A source close to the negotiations, who asked not to be named for this report, told BizTimes Monday, “Nothing like this gets done without a carrot and a stick all around. I believe the league will try to honor Herb’s desire — most of the owners and the commissioners really like Herb and are concerned about the image of the game. So the league will likely have some future influence with the new owners — possibly a covenant that allows the league to take over the franchise if the deal for a new arena falls through. So the new owners better work hard, or all they get is their money back. Also, the local and state government leaders need to feel the pressure to help get things done, but there are lots of options other than a regional sales tax. It doesn’t make sense to just build a new arena and leave the rest of the downtown area, including the convention center, languishing. Maybe there’s a way to empower the city and/or county to pull on their own bootstraps with a larger, more ambitious plan together with some sharing of incremental taxes of all kinds generated by the new development.”
One source said the league would likely only intervene and take ownership of the Bucks step if it did not see “significant progress” toward a new arena in Milwaukee.
New NBA commissioner Adam Silver said the league was prepared to insist that Milwaukee have a plan for a modern arena by 2017 to keep the franchise where it has been since its inception in 1971.
“Sen. Kohl put in place provisions to ensure that the team stays in Milwaukee,” Silver said last week after the league’s annual board of governors meetings.
The board has not yet signed off on the deal to sell the team.
