EXPLAINER: Inside the proposed sale of the Suns and Mercury

In his time at Michigan State, Mat Ishbia scored 0.6 points per game on average and contributed 0.3 rebounds and 0.3 assists on top of that.

Those aren’t exactly world-record breaking figures.
But the $4 billion mark will soon become his identity in the industry. Ishbia has made the largest purchase in NBA history with its $4 billion offer to purchase the Phoenix Suns and Phoenix Mercury of the WNBA.

Once the league approves the sale, the arrangement will mark the end of the reign of troubled owner Robert Sarver over those teams.
A look at the transaction and what comes next:

The identity of MAT ISHBIA is yet to be revealed.

On January 6th, Ishbia will become 43 years old. He was a good high school player despite his small stature (5-foot-10), leading Birmingham (Michigan) Seaholm High in scoring as a senior in 1997-98 with 36 points in a single game and converting both ends of a 1-and-1 late in regulation to send the game into overtime and seal the victory over a rival.

Ishbia went onto the Michigan State team and became so valuable to coach Tom Izzo that by the conclusion of his career, he was sitting next to Izzo on the bench, working as a de facto assistant coach. He played the final few seconds of the Spartans’ 2000 national title game triumph against Florida.

Since then, he’s been a lifelong Michigan State fan. United Wholesale Mortgage was formed by Ishbia’s father, and some of his former teammates, including Mateen Cleaves, have worked for him at the organisation. And his 2021 contribution of $32 million to the university helped pay for items like football coach Mel Tucker’s $95 million salary.

Others will claim that he inherited a successful business from his father, and that is somewhat true. It’s also important to remember that Ishbia wasn’t handed the reins of the company straight out of college. In an interview with the Detroit Free Press in 2020, Ishbia recalled that his first year’s compensation at UWM was $18,000. At the time, the firm employed fewer than 20 people.
UWM presently employs around 8,000 people; Ishbia made little less than $8 million in compensation in 2017; and Bloomberg estimates that he is worth $5.26 billion.

His firm, which went public at the beginning of 2021, competes with Quicken Loans, founded and led by Dan Gilbert, the owner of the Cleveland Cavaliers. Both Gilbert and Ishbia attended Michigan State University, as did Detroit Pistons owner Tom Gores.

According to a 2021 CNBC interview with Ishbia, “my business is not geared to make my competitors like me.” That’s not the approach I’ll take. For the sake of my investors, my employees, and my brokers, I will succeed.

For how much exactly does the Phoenix franchise count?

However, Ishbia insists that it is. Putting money into it is an investment, and probably a wise one.

Forbes now lists the Suns franchise value at $2.7 billion. Franchises in every major sport are increasing in value, and the NBA is about to sign a new media rights contract that may be worth three times as much as the present $24 billion, nine-year arrangement.

NBA clubs will become even more valuable as a result, while business is thriving overall with league revenue surpassing $10 billion for the first time ever in the 2017–18 season.

HOW WILL THIS DEAL AFFECT THE GROWTH OF THE NBA?
After the next Collective Bargaining Agreement and media rights contract are finalised, the NBA will grow. If the clubs are sold for $4 billion, as estimated, the NBA might demand an expansion fee of $5 billion or more from the next companies interested in purchasing franchises.

NBA Commissioner Adam Silver said last week, “We need to renew those… then we will move to growth.” “As I have stated before, I feel it’s, our manifest destiny to continue to expand, and not only grow in the United States but grow outside the United States as well.”

This is not going to happen soon. Until at least 2025, it’s unlikely that the NBA will grow.

As to why the sunnies have to be sold, please explain.

A one-year suspension would have expired in September 2023, at which point Robert Sarver would have been eligible to return as an owner. The fact, however, was that the suspension and the devastating study that had been commissioned when ESPN first reported on his years of boorish behaviour had doomed him.

To put it another way, there was just no way for him to return. Once Sarver recognised he needed to sell, he actively sought out potential buyers.

As managing partner, Sarver had the authority to approve the sale notwithstanding the presence of limited partners.

After the deal is finalised, Ishbia and his brother Justin Ishbia would own more than half of the club due to their acquisition of all of Sarver’s shares and a portion of the limited partners’ holdings.

THEN WHAT HAPPENS?

The NBA will be looking into Ishbia’s case. The league will investigate his personal and business finances, his behaviour, and other factors for warning signs.

After that is done, the transaction will be put to a vote by the league’s Board of Governors. A timeframe in which Ishbia is given permission to assume control of the Suns and Mercury in February or March seems most plausible.