4 large law firms are working on the sale of the Phoenix Suns, a potentially record-setting deal that values the National Basketball Association team and the WNBA’s Phoenix Mercury at $4 billion.
Mortgage lending billionaire Mat Ishbia and his brother Justin Ishbia agreed Tuesday to acquire a majority stake in each teams. Current owner Robert Sarver began exploring options to sell each franchises after the NBA suspended the true estate mogul and fined him $10 million over discrimination and harassment allegations.
Sarver has turned to DLA Piper partner Richard Rubano in Latest York for outdoor counsel on the deal, which still requires the league’s approval. Covington & Burling and McDermott Will & Emery are advising the Ishbias, while Proskauer Rose is representing the NBA, a longtime client of the firm.
Two sources acquainted with the negotiations confirmed the legal lineups on the deal, which at a $4 billion valuation can be the very best price ever paid for an NBA team. All 4 firms are continuously hired by deep-pocketed investors seeking to break into the increasingly lucrative world of skilled sports by buying teams.
Sarver’s one-year suspension and high quality followed an independent investigation by Wachtell, Lipton, Rosen & Katz, which in mid-September issued a report finding that Sarver used racist slurs and harassed female employees. The NBA hired Wachtell for the inquiry last 12 months after ESPN reported on allegations of racism, misogyny, and harassment within the Suns workplace.
Sarver apologized for his actions after Wachtell lawyers accomplished their report.
Proskauer partners Joseph Leccese—chairman emeritus of the firm—and Wayne Katz have taken the lead representing the NBA on the Suns deal.
The firm’s ties to the league, whose longest-serving commissioner and one-time general counsel was former Proskauer partner David Stern, return many years. Adam Silver, the NBA’s current commissioner, is the son of late Proskauer senior partner and chairman Edward Silver.
Covington, whose partner Peter Zern in Washington is representing the Ishbias, can also be closely connected to the NBA. Zern has had a key role handling broadcast rights agreements for the league—whose general counsel is former Covington litigator Rick Buchanan—and advised on the formation of NBA Africa.
Zern and Covington also counseled Steven Ballmer on his $2 billion buy of the Los Angeles Clippers in 2014—on the time a record price for a US sports team—after working on the $338 million sale of the Latest Orleans Hornets in 2012. Covington also handled the $450 million sale of the Golden State Warriors in 2010.
McDermott tax partner Patrick McCurry in Chicago can also be representing the Ishbias. The firm, which also worked on the $350 million sale of the Memphis Grizzlies in 2012, is understood for its private client and wealth planning practice.
Mat Ishbia is chairman, president, and CEO of Pontiac, Mich.-based United Wholesale Mortgage LLC, a mortgage lender that went public last 12 months. Justin Ishbia is a founding partner of Chicago-based private equity firm Shore Capital Partners LLC.
DLA Piper’s Rubano, who’s counseling Sarver’s Suns Legacy Partners LLC, previously advised hospitality billionaire Tilman Fertitta on his $2.2 billion acquisition of the NBA’s Houston Rockets in 2017. Rubano also was a part of a legal team that handled the $730 million sale of the Atlanta Hawks in 2015.
The Suns, who reached the NBA Finals in 2021 before being knocked out of the playoffs early last 12 months, at the moment are in fourth place within the NBA’s Western Conference.
The Mercury, who play within the WNBA’s Western Conference, earlier this month saw star player Brittney Griner return to the US after being jailed in Russia for 10 months.
Sarver issued a statement late Tuesday announcing the acquisition agreement with a bunch led by the Ishbias. The announced sale of the Suns and Mercury got here a day after ESPN reported on more claims related to a toxic workplace culture under Sarver that prolonged to other club employees, including Jason Rowley, a former general counsel of the Suns now serving as president of the team.
Media contacts for the Suns and current general counsel Melissa Goldenberg—a former Greenberg Traurig associate hired by the club in 2014—didn’t reply to requests for comment about whether the team retained separate outside counsel throughout the Wachtell inquiry into its operations.
In 2010, the Suns hired Lon Babby, a sports agent and former litigation partner at Williams & Connolly in Washington, as president of basketball operations. Babby spent five years within the role before becoming a senior adviser and retiring in 2016.