Former Microsoft chief executive Steve Ballmer has won a frenetic bidding war for ownership of the Los Angeles Clippers, with a $2-billion offer that would set a record price for an NBA team.
Ballmer bid higher than competitors that included Los Angeles-based investors Tony Ressler and Bruce Karsh and a group that included David Geffen and executives from the Guggenheim Group, the Chicago-based owner of the Los Angeles Dodgers.
The Geffen group offered $1.6 billion and the Ressler-Karsh group offered $1.2 billion. Those offers were rejected, according to several people involved in the negotiations who asked not to be named because of the sensitivity of the bidding.
Ballmer and Clippers co-owner Shelly Sterling concluded a deal late Thursday afternoon. But Bobby Samini, an attorney for co-owner Donald Sterling, said as he left Sterling's home: "There's been no sale. There can be no sale without Donald's signature."
The sale price would be almost four times the previous NBA franchise high: the $550 million paid earlier this month for the Milwaukee Bucks. It would be the second-highest price ever paid for a sports team in North America. The Dodgers sold in 2012 for $2.1 billion.
Donald Sterling agreed last week to allow his wife to conduct a sale of the team. The process was rushed to beat a Tuesday deadline, when NBA owners are scheduled to meet to decide whether to strip the Sterlings of their ownership after Donald Sterling insulted African Americans in an audio recording that was leaked by the celebrity website TMZ.
Days after the recording was released, NBA Commissioner Adam Silver hit Donald Sterling with a $2.5-million fine, a lifetime ban from the league and called on the other owners to force him to sell the team he bought in 1981 for $12.5 million.
Donald Sterling has equivocated on whether he would sign off on a sale of the Clippers. Another of his attorneys, Maxwell Blecher, said Donald Sterling wanted "vindication" more than a high sale price.
The deal would also need the approval of three-quarters of the 30 NBA owners, but is expected to clear that hurdle as long as Ballmer reaffirms his pledge to keep the team in L.A. and not move it to Seattle, where he lives.
Ballmer, 58, left the software giant in February and has an estimated net worth of $20 billion. Unlike other bidders, he did not immediately seek out partners for the purchase of the Clippers.
Ballmer last year joined a group, led by hedge fund manager Chris Hansen, to bid on the Sacramento Kings, intending to move the team to Seattle. NBA owners voted down the proposal.
The businessman said in a recent interview that he had no intention of moving the Clippers. He said that the high valuations for the team only made sense in Los Angeles.
The turn to sports perhaps shouldn't be entirely surprising for Ballmer, a man whom many have described over the years as the head cheerleader for Microsoft.
Ballmer is a native of Detroit who attended Harvard University, where he was a manager for the football team and worked for the student newspaper. He lived down the hall from a nerdy young math whiz named Bill Gates. While Gates dropped out to return to his hometown of Seattle and start a computer company, Ballmer continued, graduating and later attending Stanford University to get his MBA.
But in 1980, Gates persuaded his friend to become the 30th employee and first business manager of the company now called Microsoft.
Over the next two decades, the men became an essential force in ushering in the PC era of computing. The franchise they would build around the Windows operating system created a company feared throughout Silicon Valley, and one that made them — along with co-founder Paul Allen — fantastically wealthy. Allen owns the NBA's Portland Trail Blazers and the NFL's Seattle Seahawks.
Ballmer gained a reputation for having an exuberant personality.
At meetings, he rallied the company's sales force by jumping around the stage and shouting. He also filmed a number of zany Microsoft promotional videos that have long since gone viral where he can be seen hawking early versions of Windows with the vigor of a used car salesman.
In January 2000, Ballmer succeeded Gates as CEO of Microsoft, a job he held until February. While the company's revenues and profits continued to expand throughout Ballmer's tenure, there was a sense that the company had fallen behind in a number of key technologies.
Though supporters believed that Ballmer's successes, such as launching the Xbox and pushing the company deeper into business-related computing markets, were never fully acknowledged, Ballmer decided last year that he would step aside because he believed the negative perceptions of his leadership would always color outsiders' view of the company.