Minnesota Timberwolves could sell for over $ 1 billion
Glen Taylor, owner of the Minnesota Timberwolves, passes a ball before the game between the Minnesota Timberwolves and the San Antonio Spurs on November 15, 2017 at the Target Center in Minneapolis, Minnesota.
Hannah Foslien | Getty Images
This is how one team front office member described the Minnesota Timberwolves, the National Basketball Association’s youngest franchise that hit rock bottom and now has the lowest percentage of profits in major sports.
The Timberwolves entered the NBA in 1989 for $ 32.5 million and sold it to Glen Taylor in 1994 for about $ 90 million. This so-called puzzle is now worth over $ 1 billion in 2021 and is slated to be for sale.
The pieces include Taylor grappling with longtime franchise star Kevin Garnett, a manager, Gerson Rosas, who is embroiled in his own PR issue after an unusual take on it. And the Timberwolves roster, the main attraction of the store, is the other confusing piece and could be on the verge of yet another overhaul.
A big puzzle.
“It’s all mixed up,” said the front office member when asked about the team.
The person agreed to speak to CNBC on condition that they remain anonymous as the person does not have the authority to speak publicly about any other NBA club’s affairs.
But NBA Commissioner Adam Silver spoke publicly about Timberwolves ahead of the 2021 All-Star Game last weekend. In 1994, Silver, then chief of staff to former NBA commissioner David Stern, was on Taylor’s handshake deal to buy the club.
The league prevented legendary boxing promoter Bob Arum from buying the team for $ 152 million and possibly moving it to New Orleans. Taylor, a former Minnesota state senator, stepped in to save the team.
“This is a Minnesota resource. I was afraid it would leave the state, so I got involved,” Taylor said in 1994, according to the Post Bulletin.
But since joining the NBA, the Timberwolves have only had 988 wins and over 1,500 losses. Earlier this month it overtook the Tampa Bay Buccaneers for the worst percentage of the profit for a major US sports team. Of the victories, 883 are tied to Taylor’s possession. And Garnett helped Taylor claim 501 victories since he began his reign with the team in 1995.
The two have a broken relationship and it took another blow after Garnett’s plans to buy the team failed. He used Instagram to announce he was retiring as a buyer and turning his eyes to potential franchises in Seattle and Las Vegas.
Taylor said Garnett never bid, telling local media that about 10 groups had made offers. Silver said he was “dismayed to read this back and forth” and would use this as an “opportunity to get involved”.
A sports banker familiar with the offerings for the team suggested that Taylor could raise approximately $ 1.3 billion for the club in a Covid-19 market. But whether he is serious about selling the team is another question.
“He’s had some discussion with groups about the possible purchase of the franchise, and I think Glen has been waffled over the years,” said Silver. “I think he loves both owning the Timberwolves and being part of the league, while looking to the future and trying to be accountable for his family and community regarding next-generation property.”
The Timberwolves declined to comment.
Minnesota Timberwolves head coach Chris Finch speaks to his team during the game against the Charlotte Hornets on March 3, 2021 at the Target Center in Minneapolis, Minnesota.
David Sherman | National Basketball Association | Getty Images
Solve an image problem
According to Forbes, the club has annual sales of around $ 200 million, which also values the team at $ 1.4 billion. The team has a local TV rights deal with a Sinclair Broadcast Group and has been recognized for its community outreach initiatives, particularly after the death of George Floyd.
But Taylor’s team has other image issues that it needs to address.
Saunders, the beloved son of Flip Saunders, was popular in the organization. His father trained the Timberwolves with Garnett for the best 58 wins in the 2003/04 season. And NBA chatter suggests it was Flip who stopped Taylor from selling the team in 2013 just before ratings skyrocketed.
Rosas fired Saunders last month after winning seven this season and hired Toronto assistant coach Chris Finch. The attitude was unusual and a cause of concern for the NBA Coaches Association when Rosas bypassed Timberwolves assistant David Vanterpool, popular with rivals and coaches.
And the roster is anchored near the two-time all-star cities of Karl-Anthony, but NBA scouts point out that Rosa’s vision appears to emulate the Daryl Morey-led Houston Rockets with ace three-point shooters, but the staff is lacking. Some in NBA circles are suggesting trading Towns, who makes $ 29 million this season, and rebuilding rookie Anthony Edwards around.
Tony Ponturo, longtime director of marketing, said corporate sponsors should avoid the Timberwolves.
“Every consumer brand that joins a sports sponsorship team wants to improve their image and find a way to better relate to their customers in this market,” said Ponturo. “If a team isn’t doing well, and presumably a team that hasn’t done well in a long time, you could argue that the Minneapolis image isn’t that good. So it’s not a good thing to connect with.”
The Timberwolves marquee is the shirt, and the club would like it to be sold before the 2021-22 season. The region is home to big companies like Target and Best Buy, but Ponturo said marketers shouldn’t pay too much to do business with the team, especially other pro teams in town that are winning.
“If the image you are associated with is negative or damaged, then you should probably keep your money in your pocket and do something with the Vikings or Twins,” he said. “”[Marketers] are better off finding out and seeing in a year if the team has made progress. “
Cody Martin # 11 of the Charlotte Hornets shoots the ball against the Minnesota Timberwolves on March 3, 2021 at the Target Center in Minneapolis, Minnesota.
David Sherman | National Basketball Association | Getty Images
The arena piece
Should a buyer induce Taylor to sell, the new owner has the Target Center as an asset.
The downtown arena received a massive $ 140 million upgrade to make it more modern. Taylor paid $ 58 million to cover the cost.
The building operated by ASM Global is not the most technically advanced arena, but it is admired for its “basketball geometry”. It’s a term used among longtime NBA managers and means that the stadium was built to watch basketball games.
“It’s not a pleasant building, and when you walk into the building from a fan perspective, there is no initial wow factor,” said a team manager, who asked not to be identified. “But the fact is, when it’s basketball geometry, it’s just a better building to watch a game.”
The “backup housing” of the Target Center, which can be easily converted for other events, is also praised. The challenge is to find a way to maximize game day income.
Before the pandemic, the arena ranked 28th in NBA participation, according to ESPN. The Timberwolves have not landed in the top 10 in this category since the 2003/04 season when Garnett led them to the final of the Western Conference.
But maybe Silver can help steer the Timberwolves in the right direction or find another owner willing to take the reins, as Taylor did in 1994. A former Timberwolves employee described the current state of this NBA franchise as “unhappy” and lacking direction.
“I wouldn’t call it a puzzle,” said the employee. “It’s just been a lot of different executives in a short space of time and you change direction every five minutes. You can’t win something like that. It’s just too much inconsistency.”