Russian tycoon to buy Nets, move team to Brooklyn

[September 24, 2009]  EAST RUTHERFORD, N.J. (AP) -- The NBA has truly gone global.

Russian tycoon Mikhail Prokhorov reached an agreement Wednesday to buy 80 percent of the financially strapped New Jersey Nets and nearly half of a project to build a new arena in Brooklyn.

The only thing that stands in the way is a nyet from the league's board of governors, and that doesn't seem likely with NBA commissioner David Stern already giving the deal his initial blessing.

The proposed blockbuster deal would give the Nets' current principal owner, Bruce Ratner, the needed cash to move forward with the Barclays Center, the centerpiece of his Atlantic Yards development, which includes plans for retail and residential projects.

It would make Prokhorov, a billionaire and former amateur basketball player, the NBA's first non-North American owner.

It would also mean the Nets really do seem headed to Brooklyn, a New York City borough without a major pro sports franchise since baseball's Dodgers moved to Los Angeles in 1957.

"Interest in basketball and the NBA is growing rapidly on a global basis, and we are especially encouraged by Mr. Prokhorov's commitment to the Nets and the opportunity it presents to continue the growth of basketball in Russia," Stern said in a statement.

Dallas Mavericks owner Mark Cuban, too, is ready to welcome Prokhorov to the NBA.

"I love it. I think he will bring fresh ideas and viewpoints, and hopefully this will be the start of a trend toward international investors," Cuban said in an e-mail to The Associated Press. "Plus, I took Russian in high school, so it will give me a chance to refresh."

Stern has long touted the NBA's international reach, boasting that two-thirds of the players on the medals podium at the Beijing Olympics were NBA players. The league plays preseason games in Europe and China, and its All-Star and NBA finals games have been televised in hundreds of countries.

In going global, Stern could be welcoming quite a globetrotter.

Prokhorov, who is 6-foot-6 and was an avid basketball player in his school days, is a fixture in glitzy European resorts and once was held in France for four days of questioning -- but never charged -- in a prostitution investigation. Even in Russia, he raises eyebrows for his penchant for private jets and a gorgeous entourage.

Prokhorov's love of the high life is rivaled by his devotion to basketball. He owns a share of the Russian team CSKA Moscow, and he said on his blog he wants to buy the Nets partly to get access to NBA training methods and help Russian coaches get internships in the league.

Russia has a proud basketball tradition, having won the Euro championship in 2007. CSKA is a perennial Euroleague power. Yet Andrei Kirilenko, a Utah Jazz forward, is the only Russian currently in the NBA.

Prokhorov has been ranked as his country's richest man in the Russian edition of Forbes, with an estimated $9.5 billion -- even after shrinking by some $7 billion in the world economic crisis.

Another rich Russian oligarch, Roman Abramovich, is the owner of the British soccer power Chelsea. Uzbekistan-born billionaire Alisher Usmanov owns more than 25 percent of another British soccer team, Arsenal.

"In any sport nowadays, if you can bring someone in who is financially stable, it is great for the sport, and I think it will be great for the NBA," former player and current TV analyst Charles Barkley said.

The franchise started with the ABA in 1967 as the Americans and then the Nets, bouncing around to different arenas in New Jersey and New York before settling in East Rutherford in 1981-82. Their current home, the Izod Center, is 30 years old.

Nets president Rod Thorn said he expects little reaction about a Russian owner: "I don't think players really care who owns the team."

It's not clear how Brooklyn's sports fans might take to a team with foreign ownership.

There's already been community grumbling over the British bank Barclays buying the naming rights to the arena -- and also the rights to name the subway station beneath it.

Brooklyn's famed Russian enclave of Brighton Beach is only a few miles from the proposed arena, but for many Russian emigrants Prokhorov symbolizes everything wrong in their homeland -- a smooth operator who made a fortune when Russia sold off its state industrial treasures for a song.

Los Angeles Lakers guard Derek Fisher, who also is president of the NBA players' association, said the deal "speaks to the fact there's something that potential ownership groups still see about the NBA that is good because you wouldn't have anybody -- European, Russian, American -- buying into an NBA team at this point if they didn't see something that was a positive for them to get out of the deal."

Prokhorov's Onexim Group announced the deal jointly with Forest City Ratner Cos. and Nets Sports and Entertainment. According to the agreement, entities to be formed by Onexim Group will invest $200 million and make funding commitments to acquire 80 percent of the NBA team, 45 percent of the arena project and the right to buy up to 20 percent of the Atlantic Yards Development Co., which will develop the non-arena real estate.

The NBA will review the proposal, and the deal must be approved by three-fourths of its board of governors. Ratner and Prokhorov hope to have the sale completed by the first quarter of 2010.

"I have a long-standing passion for basketball and pursuing interests that forward the development of the sport in Russia," Prokhorov said in a statement. "I look forward to becoming a member of the NBA and working with Bruce and his talented team to bring the Nets to Brooklyn."

While the proposed deal would give Ratner's group an infusion of money for the arena project -- he faces a December deadline to break ground or lose access to financing from tax-free bonds -- there is fervent opposition to the additional 22-acre residential and commercial real estate development. It would create more than a dozen residential and office towers with more than 6,400 apartments built over property that includes a rail yard, warehouses and several blocks of homes and businesses.

Critics include homeowners who say the government is illegally claiming their property and thousands of residents who worry about how the skyscraper project will affect their neighborhoods.

New York's Court of Appeals is to hear an eminent domain challenge to the project next month.

City Council member Letitia James, a fierce critic of Atlantic Yards, said: "For Forest City Ratner to save this project by associating with someone who has been accused of being involved in a prostitution ring is an embarrassment. Let it go. Let it die."

Prokhorov, 44, shot to prominence in the chaotic early years of privatization deals that followed the collapse of the Soviet Union. In 1993, the Onexim bank he headed acquired Norilsk Nickel, one of Russia's huge but lumbering industrial conglomerates.

Under Prokhorov, Norilsk became more efficient and profitable. He resigned as Norilsk chairman in 2007 and sold his shares for $7.5 billion, but retains substantial interests in other metals companies through Onexim, including shares in gold-miner Polyus and Rusal, the world's largest aluminum company. Onexim's other interests include real estate, insurance and energy.

[Associated Press; By TOM CANAVAN]

AP Basketball Writer Brian Mahoney and AP Writer Karen Mathews in New York, AP Sports Writer Jaime Aron in Dallas, and AP Writer Jim Heintz in Moscow contributed to this report.

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