Tilman Fertitta, the billionaire entrepreneur and owner of Landry's, is now the owner of an NBA franchise.
Fertitta reached an agreement with Houston Rockets' owner Leslie Alexander to acquire the franchise for $2.2 billion, the Houston Chronicle
reported. The transaction represents the largest of its kind in NBA history and exceeds Steve Ballmer's $2 billion purchase of
the Los Angeles Clippers in 2014. Alexander will be walking away with a hefty profit on the sale after buying the team in 1993 for
just $85 million.
Wall Street reacted to the transaction as shares of Madison Square Garden Co (NYSE: MSG) gained 7 percent by late Tuesday morning.
Madison Square Garden hosts the iconic New York Knicks' basketball games and logic dictates that the high price tag of the
Houston Rockets deal makes the Knicks' franchise even more valuable than previously thought.
During Madison Square Garden's most recent quarter,
the company said its Sports division reported a 35 percent increase in revenue to $179.6 million. Management cited higher league
distributions and playoff-related revenues and, to a lesser extent, higher professional sports teams' sponsorship and signage
revenues and media rights fees.
Of particular note, investors shouldn't
confuse Madison Square Garden with its sister company, MSG Networks Inc (NYSE: MSGN), whose stock dipped around 1 percent on Tuesday. MSG Networks operates two
regional sports and entertainment networks.
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