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Mark Walter’s sale of the Lakers at a $12.5 billion valuation to a group led by Joshua Kushner and Bob Iger will not be halted by the Buss family drama that erupted Monday, sources tell Front Office Sports.
The surprise deal, announced last week, got another twist when the “Buss family” issued a statement Monday saying it would be selling its remaining 17.8% stake in the team, which is held in a family trust. Jeanie Buss, the team’s governor, quickly disputed that notion. Her lawyer issued a letter arguing the Buss siblings don’t have the right to compel the family to exit.
This all prompted speculation that the acquisition of the Lakers by Kushner and Iger could be at risk.
But two sources familiar with the matter tell FOS that isn’t the case. One source says “it’s worth noting that this is strictly between the family and doesn’t impact the proposed deal with Bob and Josh in any way.”
Still, the timeline for when their deal will go through is not clear. Walter is selling the team less than a year after his purchase was completed—and as his business empire is under federal investigation.
It also remains unclear whether Jeanie Buss is right that her family can’t choose to sell. ESPN reported Monday that “at least” five of the six Buss siblings voted to exercise what are known as “tag-along” rights, which are meant to protect minority investors by allowing them to sell their interest in a franchise when control changes hands. The siblings, excluding Jeanie Buss, appear to believe they needed a simple majority vote, but her lawyer says that isn’t the case.
The attorney, Adam Streisand of Sheppard, Mullin, Richter & Hampton LLP, pointed to a 2017 court order he says shows that a sale of the family stake cannot be made without approval by the current co-trustees, which are Jeanie, Janie, and Joey Buss. Additionally, his letter says the court order requires the family to maintain at least a 15% ownership stake so Jeanie Buss can remain “controlling owner.” Streisand refers to Jeanie Buss as the “controlling owner” of the Lakers, not the governor, and that language is also used in the 2017 court order.
Jeanie Buss was named the controlling owner four years after a majority stake in the team was left to her and her siblings following her father’s death in 2013. The Buss family ceded majority control of the Lakers in last year’s sale to Walter.
One legal industry source who has worked on other team sales says that as a minority shareholder, Jeanie Buss cannot be the controlling owner. She’s the governor—which is what the press release announcing Walter’s acquisition called her. The NBA in 2019 started calling team owners governors, and a controlling owner is allowed to appoint two alternate governors.
Under the deal with Walter, Jeanie Buss was meant to stay on as governor and oversee day-to-day operations “for the foreseeable future.”
“Having seen other agreements, Mark Walter was not going to buy the Lakers for $10 billion and have Jeanie Buss be the manager of the entity that owns the team,” the source says. “I know that’s true, because otherwise Kushner and Iger couldn’t have bought the Lakers from Walter.”
Under NBA rules, the team governor must own at least 15% of a franchise. On Wednesday, The Athletic cited a league source as saying Jeanie Buss would be open to a scenario where the rest of the family sells but she somehow still maintains a stake of at least 15%.
“What she’s really fighting about is being the governor for a team she no longer owns,” the legal industry source tells FOS. “That’s a little weird.”
A representative for Kushner declined to comment, and representatives for Jeanie Buss, the Buss siblings, the Lakers, and the NBA did not immediately respond to requests for comment.
