Private Equity

Sorry Milwaukee Bucks fans: Private equity owners aren't much help

April 16, 2014: 1:35 PM ET

The Milwaukee Bucks are getting new owners, but history isn't on their side.


FORTUNE -- This has been a trying season for fans of the Milwaukee Bucks, which tonight will close out a season in which it lost more than four times as many games as it won.  Now things are getting even worse, with news that the team will be sold to a pair of private equity professionals: Wes Edens of Fortress Investment Group (FIG) and Marc Lasry of Avenue Capital.

Don't get me wrong: Both Edens and Lasry have outstanding records as investors, and I have nothing against either one of them personally. But the reality is that private equity professionals have a pretty lousy record so far as owners of NBA franchises. And I mean "record" literally.

The Bucks would become the fifth franchise (out of 30) to be owned by individual private equity or venture capital investors. The others are the :

  • Boston Celtics: Acquired for $380 million in 2002 by a group led by Steve Pagliuca (Bain Capital) and Wyc Grousbeck (Highland Capital Partners). Minority partners on that deal included Glenn Hutchins (Silver Lake Partners), Michael Marks (Riverwood Capital), hedge fund manager Jim Pallotta, David Bonderman (TPG Capital) and Jim Breyer (Accel Partners).
  • Detroit Pistons: Purchased in 2011 for $325 million by Tom Gores and his private equity firm Platinum Equity.
  • Golden State Warriors: Purchased in 2010 for $450 million by an investor group led by venture capitalist Joe Lacob (ex-Kleiner Perkins Caufield & Byers).
  • Philadelphia 76ers: Purchased in 2011 for $280 million by Apollo Global Management (APO) co-founder Josh Harris. His partners on the deal include David Blitzer of The Blackstone Group (BX) and hedge fund manager Art Wrubel.

Since each of those franchises was acquired by their respective owners, they have a combined regular season record of 787-816. And, for context, that 49% winning percentage is a scant three points higher than the combined franchises' winning percentage for the five years before being purchased by private equity investors.

RELATED: Marc Lasry's troubled path to Paris

Only one of them has won a championship (the Celtics in 2008), while only the Warriors will even make the playoffs this year (the other three are draft lottery bound). And none of this addresses the usually-woeful Toronto Raptors, which until 2012 were majority owned by the private equity arm of a public pension system in Canada.

The good news for Bucks fans is that things probably can't get much worse. The bad news is that history doesn't suggest things will get much better.

Sign up for Dan Primack's daily email newsletter on deals and deal-makers:

  • Deals of the day: Private equity circles Symantec

    To get deals in your inbox each morning, sign up for our Term Sheet newsletter

    Venture Capital Deals

    PanOptica, a Bernardsville, N.J.-based developer of ophthalmology therapies for conditions like neovascular age-related macular degeneration, has raised $45 million in Series B funding. Novo Ventures and existing backer Third Rock Ventures co-led the round, and were joined by founding investor SV Life Sciences.

    Squarespace, a New York-based website publishing and e-commerce platform for businesses, has raised $40 million in Series MORE

    - Apr 16, 2014 10:57 AM ET
  • Deals of the day: Motorola selling enterprise biz

    To get deals in your inbox each morning, sign up for our Term Sheet newsletter

    Venture Capital Deals

    SilverRail, a Woburn, Mass.-based developer of passenger rail search and distribution technologies, has raised $40 million in Series C funding. Mithril Capital Management led the round, and was joined by return backers Canaan Partners, Sutter Hill Ventures and Brook Ventures. Avvo, a Seattle-based online marketplace for legal advice, has raised $37.5 million in Series D funding.Coatue Management led the MORE

    - Apr 15, 2014 1:45 PM ET
  • Madison Dearborn's patience pays off on Nuveen Investments

    In private equity, 'break-even' sometimes can be a win.

    FORTUNE -- Sometimes the best private equity strategy is to wait it out.

    Several years ago, Madison Dearborn Partners was really sweating its June 2007 decision to lead a $6.4 billion acquisition of Chicago-based mutual fund manager Nuveen Investments. The deal had been done at a 20% premium to where Nuveen was trading, even though the stock markets were at record highs. Soon MORE

    - Apr 14, 2014 12:22 PM ET
  • Deals of the day: TIAA-CREF buying Nuveen

    To get deals in your inbox each morning, sign up for our Term Sheet newsletter

    Venture Capital Deals

    Julep Beauty, a Seattle-based beauty brand and ecommerce company, has raised $30 million in Series C funding. Azure Capital, Altimeter Capital and Madrona Venture Group were joined by return backers Andreessen Horowitz and Maveron. The company previously raised $26 million.

    NatureBox, a San Carlos, Calif.-based subscription box service focused on healthy snack food, has raised $18 MORE

    - Apr 14, 2014 11:18 AM ET
  • Goldman Sachs to invest in AvePoint

    Goldman Sachs to acquire stake in maker of big data management and compliance software.

    FORTUNE -- Goldman Sachs (GS) has agreed to acquire a minority equity stake in AvePoint, a New Jersey-based provider of big data management, governance and compliance software for social collaboration platforms like Microsoft Sharepoint. We have not yet learned any financial terms of the deal, which was first disclosed in a Federal Trade Commission document.

    Current AvePoint shareholders include private equity firm Summit MORE

    - Apr 10, 2014 2:35 PM ET
  • Private equity tax breaks: How long will they last?

    Are PE funds similar to mutual funds or are they in the business of buying, developing, and then selling companies at a profit? Much hinges on the answer.

    By Eileen Appelbaum

    FORTUNE -- With the annual tax deadline approaching next week, middle class Americans may be wondering how private equity titans like Mitt Romney get away with such low tax rates on their millions in income. The answer is that MORE

    Apr 10, 2014 2:05 PM ET
  • Deals of the day: Zendesk files for IPO

    To get deals in your inbox each morning, sign up for our Term Sheet newsletter

    Venture Capital Deals

    NuCana Biomed, a British developer of oncology therapeutics, has raised $57 million in Series B funding. Sofinnova Ventures led the round, and was joined by existing backers Sofinnova Partners, Morningside Ventures, Alida Capital and the Scottish Investment Bank. www.nucanabiomed.comTendyne Holdings Inc., a Roseville, Minn.-based developer of technologies for transcatheter mitral valve replacement, has raised $25 million in Series MORE

    - Apr 10, 2014 10:58 AM ET
  • Ex-Urban Outfitters CEO talks about his new private equity plans

    Glen Senk has more than $350 million to invest into growing consumer and retail companies.

    FORTUNE -- Two months after stepping down as CEO of luxury jeweler David Yurman, Glen Senk is back with a new effort to invest in growing retail and consumer companies. It's called Front Row Partners, and is backed by $350 million from private equity firm Berkshire Partners.

    Senk is a longtime retail and consumer veteran. Prior to MORE

    - Apr 9, 2014 12:57 PM ET
  • Deals of the day: La Quinta prices low IPO

    To get deals in your inbox each morning, sign up for our Term Sheet newsletter

    Venture Capital Deals

    Quora, the online Q&A platform launched five years ago by a pair of former Facebook execs, has raised $80 million in Series C funding. The Mountain View, Calif.-based company isn't disclosing the round's valuation, but a source familiar with the situation pegs it at around $900 million. Tiger Global led the deal, and was joined by MORE

    - Apr 9, 2014 10:23 AM ET
Current Issue
  • Give the gift of Fortune
  • Get the Fortune app
  • Subscribe
Powered by VIP.