Two Billion for a sports team?

[al_liberal]

So Ballmer couldn't find anything better to spend 2 Billion dollars on? Really? I can't even ask what has happened to our country anymore.

2 Billion on a sports team.

Yeah that's what the good ole USA has become.

[Narraback]

1. LA Dogers sold for 2 Billion in 2012

http://espn.go.com/los-angeles/mlb/story/_/id/7877983/los-angeles-dodgers-sale-guggenheim-group-finalized

[GeorgeGist]

5. Obscene also.

[DJ13]

2. If you can afford $2B on a sports team

You're not paying enough taxes.

[Jenoch]

9. So far, the U.S. does not tax accumulated wealth, only income.

[Tanuki]

3. I would be ashamed to enrich Donald Sterling by that much. n/t

[GeorgeGist]

4. Obscene.

[totodeinhere]

6. So that SOB Sterling will be laughing all the way to the bank. n/t

[Algernon Moncrieff]

7. I don't have a link, but Wikipedia says Forbes estimated the value of the Clips at $575M

...so it would seem on it's face like Ballmer is overpaying. Even if Forbes was off by 100%, he's still almost $800M over.

Sterling bought the franchise in 1981 for $12.5M. Ballmer has reportedly offered $1.8B, which equates to Sterling having invested the money at 22% interest, compounded monthly. So, on one hand, I hate that Sterling is getting enriched. On the other hand, if I could buy a legal business that returns 22% compound annual interest, I'd certainly do so.

[LeftyMom]

8. It's a business.

That's too much to pay for the Clippers for several reasons, but a professional sports franchise, run well, makes money hand over fist. Even if it's mismanaged it can usually be sold for much more than one paid, there's a scarcity because the leagues rarely expand. More cities and skillionares want a franchise than there are franchises available.

There's generally no competition in the area and no danger of any (LA is an exception, which is why he's overpaying) which is why they're a really solid investment.

The reason the Clips aren't worth 2 bil isn't omg sports are teh worst, it's that they're the third priority tenant at Staples Center. You're never going to make the really big money on their games when you have to take the dates that they Lakers and Kings don't want.

[DreamGypsy]

10. Pocket change for Ballmer. (NT)

$.05.

[stevenleser]

11. Doesnt matter the industry. Buying a business is usually a numbers thing. Revenue/Profit/etc.

Although in this case, the price being paid is almost quadruple valuation. Not sure what the logic is there. http://www.forbes.com/teams/los-angeles-clippers/