September 23, 2009 5:47 PM
Simpson, Hogan Bring Russian Tycoon to NBA
Posted by Zach Lowe
As NBA junkies, we've been reading for months about the Russian oligarch Mikhail Prokhorov's interest in the New Jersey Nets, the National Basketball Association team that wants so badly to move to Brooklyn.
Well, today Mr. Prokhorov, a nickel-mining magnate believed to be Russia's wealthiest man with a net worth of $9.5 billion, finally forked over $200 million for an 80 percent stake in the Nets and a 45 percent stake in the team's yet-to-be-built Brooklyn arena, according to The New York Times and a press release from the Nets' current owner.
The $200 million will help Nets owner Bruce Ratner complete financing for the Barclays Center, the controversial arena Ratner plans to build at the intersection of Atlantic and Flatbush avenues in Brooklyn. (Prokhorov will buy the 80 percent stake in the team for a nominal symbolic value; the $200 million is really for the arena.)
Local groups have protested the arena, saying it will abuse eminent domain rules and change the character of the neighborhood. Ratner is three months from a deadline to break ground on the arena or lose access to financing through tax-exempt state bonds, according to Bloomberg.
Hogan & Hartson advised Prokhorov and his holding company, the Onexim Group. Hogan has long been the go-to deal lawyer for Prokhorov and Onexim, mostly through Todd Schafer, the firm's relationship partner with Prokhorov. Schafer, who splits his time between London and Moscow, was not immediately available for comment.
Hogan previously advised Prokhorov on his decision to sell Onexim's minority stake in the Russian nickel giant MMC Norilsk Nickel for $4.5 billion last April--a deal that turned out to be a windfall for Prokhorov when the economy collapsed and Norilsk lost value, according to our prior reports.
Hogan also advised Prokhorov on his move during the heat of the economic collapse last September to buy a 50 percent stake in the Russian investment bank Renaissance Capital, according to a report from our colleague Brian Baxter.
Simpson Thacher & Bartlett advised Forest City Ratner on its decision to take a step back from the Nets. (Ratner will still hold a minority stake in the team.) The firm began advising Forest City in 2003, when Ratner struck his original deal to buy the Nets. Ratner has been rumored to be selling the team for months, in part because the Nets have lost tens of millions of dollars annually over the last few years.
Other Hogan partners on the deal include Alexander Johnson, Maureen Hanlon, Mitchell Lubart, and Mark Weinstein.Make a comment