The Boston Celtics are in the midst of a record-breaking $6.1 billion sale to investor Bill Chisholm. However, the deal has raised concerns about its compliance with the NBA’s private equity ownership rules, prompting a review by the league office. According to reports from The Athletic, the structure of the sale includes private equity funding that “could potentially run afoul of NBA rules.” Commissioner Adam Silver has stated that the league has not contemplated changing its rules in light of this transaction, leaving the deal’s future uncertain.
The NBA first allowed private equity firms to invest in teams in 2020, introducing regulations to ensure that these investments would not undermine the league’s ownership structure. Under current rules, private equity funds can own up to 20% of a franchise but cannot hold a larger stake than the controlling owner, who must possess at least 15% of the team. These restrictions aim to prevent private equity firms from exerting disproportionate influence over team operations.
In the case of the Celtics sale, Sixth Street Partners—a private equity group involved in the transaction—has reportedly committed more money to the deal than Chisholm, the presumptive controlling owner. This arrangement appears to violate the NBA’s rules, which require the controlling owner to hold the largest stake in the franchise.
The Celtics sale is significant not only for its record-breaking valuation but also for its potential impact on the NBA’s approach to private equity ownership. If the league grants a waiver to allow the deal to proceed, it could set a precedent for future transactions, encouraging private equity firms to seek larger stakes in franchises. On the other hand, enforcing the existing rules could lead to delays or even jeopardize the sale, forcing Chisholm to restructure the deal or bring in additional investors.
Commissioner Silver has emphasized the importance of maintaining the integrity of the league’s ownership structure.
“We’re still in the process of digesting the Celtics transaction,” Silver said during a recent press conference. “There’s no question that a major transaction like that becomes relevant to our broader policies. That deal has just been presented to us, so we’re still analyzing it”.
The Boston Celtics, founded in 1946, are one of the NBA’s most successful teams, with 18 championships to their name. The sale marks a significant transition for the franchise, which has been owned by the Grousbeck family since 2002. Under their leadership, the Celtics won the 2008 and 2024 NBA championships and have remained competitive in the league.
As the league reviews the sale, the Celtics continue to perform well on the court, boasting a seven-game winning streak and solidifying their position as a top contender in the Eastern Conference.
The outcome of the Celtics sale will have far-reaching implications for the NBA and its approach to private equity funding. As the league navigates this complex transaction, it must balance the interests of investors, team owners, and fans while preserving the integrity of its ownership structure. Whether the deal proceeds as planned or requires significant adjustments, it represents a pivotal moment in the evolution of NBA franchise ownership.
