Houston Rockets Fetch Record $2.2 Billion in Sale

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Houston Rockets Fetch Record $2.2 Billion in Sale

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Tilman Fertitta, chief executive officer of Landry's Inc., agreed to buy the Houston Rockets basketball team for $2.2 billion. He is also the host of a CNBC television show called “Billion Dollar Buyer.”

Tilman Fertitta, chief executive officer of Landry’s Inc., agreed to buy the Houston Rockets basketball team for $2.2 billion. He is also the host of a CNBC television show called “Billion Dollar Buyer.”


Photo:

Chris Goodney/Bloomberg News

The owner of the Houston Rockets agreed to sell the team on Tuesday to the local billionaire Tilman Fertitta for $2.2 billion, according to a person familiar with the matter, setting a new record for the sale of an NBA team at a time when the league’s valuations are soaring.

Fertitta is the CEO of the Houston-based hospitality group Landry’s Inc., which owns restaurants, hotels, aquariums and the Golden Nugget casino in addition to its namesake seafood chain. There is no one else involved with the sale, the Rockets said.

Born and raised in Texas, Fertitta already has an outsize presence in the city. He was previously an advisory director to the Rockets and minority owner of the NFL’s Houston Texans. He’s the chairman of the University of Houston’s board of regents and a major booster for the school’s football team. And like Dallas Mavericks owner Mark Cuban, Fertitta is featured on a business reality show. It’s called “Billion Dollar Buyer.”

The sale, which would break the record $2 billion that former

Microsoft
Corp.

executive Steve Ballmer

paid to buy the Los Angeles Clippers in 2014, reflects the ascending cultural status of the NBA, a league that has seen the value of its franchise skyrocket in the last five years. Leslie Alexander decided to sell the team in July with the understanding that he would see an enormous return on his original investment: He bought the Rockets in 1993 for $85 million.

The eye-popping price might convince other longtime NBA owners to feel out the market for their teams, but it’s unlikely that many would be worth more than Houston, a huge city with attractive demographics and international appeal. As the team that drafted

Yao Ming,

the Rockets are one of the NBA’s most popular teams in China. They’re also one of the league’s most successful teams, and they’re expected to contend for a title in Fertitta’s first season with stars James Harden and Chris Paul on the roster.

One indication that the price drew notice: shares of

Madison Square Garden
Co.

, owner of the New York Knicks, climbed more than 7% after the Rockets deal was announced.

The deal, which is pending league approval, would cap a two-month sales process in which Houston was devastated by Hurricane Harvey. “It is truly unfortunate that this announcement is occurring amidst the aftermath of one of the biggest tragedies in the history of our great city,” the Rockets said in a statement.

Fertitta’s name had been mentioned in association with the team as soon as it was up for sale. There was also speculation that the Rockets would attract interest from Chinese ownership groups and the world’s most famous Houston native: Beyonce.

Fertitta tweeted on Monday to say happy birthday to Beyonce, whom he called “Houston’s all-time greatest,” sharing a photograph of the pop star wearing Paul’s new Rockets jersey. His next tweet on Tuesday morning was to announce that he’d bought the team.

Write to Ben Cohen at ben.cohen@wsj.com

By | 2017-09-06T03:46:52+00:00 September 5th, 2017|Comments Off on Houston Rockets Fetch Record $2.2 Billion in Sale