Baker Botts, DLA Piper and White & Case are advising on the record-setting $2.2 billion sale of the National Basketball Association’s Houston Rockets from former lawyer Leslie Alexander to casino and hospitality billionaire Tilman Fertitta.
The deal, the news of which emerged Tuesday, represents the highest price ever paid for an NBA franchise, beating out the $2 billion that former Microsoft Corp. CEO Steve Ballmer paid for the Los Angeles Clippers in 2014. In July, the Rockets confirmed their decision to pursue a potential sale of the franchise.
A source familiar with the deal said that Baker Botts and White & Case are advising Alexander on his proposed sale of the team, which he bought for $85 million in 1993. Michael Goldberg, chair of the international arbitration and dispute resolution group at Baker Botts in Houston and a longtime legal adviser to the team, declined to comment when contacted Tuesday.
John Reiss, global head of White & Case’s M&A group, is leading a team from the firm advising on the sale that includes corporate partner Dan Latham, finance partner Robert Kampfner, banking partner Gregory Owens, M&A counsel Ipek Candan Snyder and associates Aaron Colodny, Hannah Lee and Rosalia Martinez Rial.
White & Case previously worked with Wachtell, Lipton, Rosen & Katz in advising the Rockets three years ago during the bankruptcy of the Houston Regional Sports Network, a joint venture between the NBA team and Major League Baseball’s Houston Astros. The business was eventually sold out of Chapter 11 to AT&T Inc.’s DirecTV.
Alexander, who dropped out of Brooklyn Law School at 21 to work on Wall Street after the death of his father, eventually finished his legal studies in California before going into bond trading. His net worth has been estimated at $1.9 billion, according to Forbes, which earlier this year put the value of the Rockets at $1.65 billion. (Alexander donated $10 million last week to victims of Hurricane Harvey.)
Rafael Stone, a former lawyer at Dewey & LeBoeuf predecessor Dewey Ballantine, serves as general counsel for the Rockets. He is also working on the sale of the team to Fertitta, along with Rockets associate general counsel Randall “Clay” Allen, a former associate at Locke Lord.
Fertitta, a native of Galveston, Texas, who also serves as CEO of Houston-based restaurant company Landry’s Inc., has long had ties to the Rockets, having offered to buy the team for $81 million back in 1993. At various times during Alexander’s ownership of the team, Fertitta has served as an advisory director to the team.
A team of lawyers from DLA Piper led by corporate partners Richard Rubano and Peter White in New York are advising Fertitta on his purchase of the Rockets. Steven Scheinthal, a longtime general counsel at Landry’s, is also working closely with Rubano and White in advising Fertitta, who earlier this year melted the dreams of two former Sidley Austin associates on his reality television show “Billion Dollar Buyer.”
Other DLA Piper lawyers working on the Rockets deal for Fertitta—a third cousin of brothers Frank and Lorenzo Fertitta, who sold the Ultimate Fighting Championship for $4 billion in 2016—include transactional tax co-chair Gerald Rokoff, tax partner Drew Young, real estate finance partner Jason Goldstein, finance partner Mark Whitaker, M&A partner Brendan Head, employee benefits and tax partner Rita Patel, intellectual property partner William Bartow, attorney Erin Byrnes and associates Ian Boardman, Caleb Ginsberg, Jesse Kirsch, Priya Narahari, Andrew Perlman, Ruchi Shah and Hayley Wallace.
The sale of the Rockets, which includes the operating rights to the Toyota Center Arena, the team’s 18,000-seat home, requires the approval of the NBA’s Board of Governors. The transaction is the latest NBA-related matter to generate work for Am Law 100 firms.
Last month Wachtell and Sheppard, Mullin, Richter & Hampton grabbed roles on an internal investigation by the NBA into alleged tampering by the Los Angeles Lakers and former Indiana Pacers forward Paul George. The Wachtell-led probe concluded last week with a $500,000 fine levied against the Lakers, the largest-ever penalty of its kind levied by the league, and the latest legal setback for the team.
In late August, the U.S. Court of Appeals dealt the Lakers a loss in a Telephone Consumer Protection Act suit.