Marc Lore and Alex Rodriguez have exercised their option to purchase the next 20 percent of the Minnesota Timberwolves and Minnesota Lynx.

Lore and Rodriguez had until the end of the day Saturday to inform Glen Taylor that they had exercised the option.

The next step will be to purchase another 40 percent of the team. Lore and Rodriguez have until Dec. 31, 2023 to exercise that option.

Lore and Rodriguez have recruited other investors to join their Purple Buyers Holdings LLC, which joined the Timberwolves as limited partners in the summer of 2021. 

The unique structure of the acquisition satisfied Taylor's timeline for not yet wanting to relinquish control while also giving Lore and Rodriguez enough time to raise the capital needed to buy the franchise at a $1.5 billion valuation. Taylor plans on holding on to the final 20 percent of the franchise for some time after relinquishing majority control.

Marc Lore and Alex Rodriguez have spent the past six months raising money to fund their purchase of the Minnesota Timberwolves with a Dec. 31 deadline to exercise an option to buy another 20 percent of the franchise from Glen Taylor.

The deadline is the first of three pre-priced call options in a unique layaway deal approved by the NBA last July. 

Rodriguez and Lore have spoken with private equity firms, family offices and individual investors about coming in at higher price than the $1.5 billion valuation that they negotiated last year.

If exercised, the group has 60 to 90 days to close on that payment.

The third option, a 40% stake that would give the pair a majority of the franchise, must be exercised before the end of 2023. The option for the final 20% must be exercised before Dec. 31, 2024.

Sportico currently values the franchise at $1.7 billion, which is the third lowest in the NBA. The Phoenix Suns recently sold at a $4 billion valuation. 

Lore and Rodriguez have discussed significantly higher valuations in their talks with investors, according to people familiar with those talks, including numbers higher than $2 billion.

Mat Ishbia is finalizing the purchase of the Phoenix Suns and Phoenix Mercury at a valuation of approximately $4 billion. 

Ishbia is a billionaire mortgage lender as the President and CEO of United Wholesale Mortgage. UWM was founded by Ishbia's father, Jeff Ishbia, in 1986.

Ishbia played college basketball at Michigan State and has a reported net worth of approximately $5.1 billion.

Justin Ishbia, a founding partner in Shore Capital and the brother of Mat Ishbia, will make a significant investment and serve as alternate governor.

The sale of the Suns will end the tenure of Robert Sarver as owner. Sarver bought the Suns in 2004 for $401 million and he was suspended by the NBA for one year in September due to his conduct as owner.

The NBA and NBPA have agreed to extend the collective bargaining agreement opt-out deadline to Feb. 8th, which is one day before the trade deadline.

The league and union said in their statement that they are making "ongoing efforts to reach a new agreement." 

The existing CBA would expire after the 23-24 season, but the agreement will end on June 30th if either side exercises their opt-out.

The NBA is seeking the implementation of an upper spending limit, which is a version of a hard cap.

The Golden State Warriors have become the NBA's most valuable franchise at $7.56 billion, according to Sportico's latest ranking.

The Warriors had $800 million in gross revenue last season, which was 50 percent higher than any other franchise. The revenue gap between the Warriors and the rest of the NBA is even greater than the New York Yankees and Dallas Cowboys, who generate roughly 40 percent and 25 percent more venue than their league's number two.

The Cowboys are the only franchise in the world worth more than the Warriors at $7.64 billion.

“Our basketball team will always be our primary focus,” Joe Lacob said in a phone interview. “But I view our future as a sports, entertainment, media and technology company.”

Lacob believes the Warriors can become like Disney in diversifying their business after starting with animated movies and adding theme parks.

“There is no reason we can’t do some of those things over the long term,” he said.

The Warriors make more than double any other franchise in sponsorships ($150 million) and premium seating ($250 million), but they are locked in a below-value local TV deal.

The NBA and NBPA have agreed to extend the December 15th deadline that allows either side to give notice of plans to opt out of the current collective bargaining agreement. The extension is expected to be into February. 

Negotiations on a new collective bargaining agreement are ongoing and this extension was expected.

The owners are reportedly seeking a hard cap as part of this CBA, which the players' side has stated that they're prepared for a lockout rather than concede on the issue. The NBA has attempted to use the term 'upper spending limit' rather than 'hard cap'. The hard cap would replace the luxury tax system currently in place that penalizes high spending teams. 

The current collective bargaining agreement expires after the 23-24 season.

Netflix do not intend to bid on live sports rights in the near future.

“We’ve not seen a profit path” from “renting big-league sports,” co-CEO Ted Sarandos said during a keynote session at the UBS Global Technology, Media & Telecom Conference. “We’re not saying there never will be,” he added,” but “dramatically expensive” rights have made sports effectively a “loss leader.”

Netflix has begun ad-supported streaming, which was seen by many observers as a prelude to live sports. Their streaming competitors, Amazon and Apple, have each invested heavily in live sports.

“We’re not anti-sports,” Sarandos explained. “We’re just pro-profit. We have yet to figure out how to do it. But I’m very confident we can get twice as big as we are without sports.” The streaming leader did “a thing that’s kind of unheard-of in the history of television” when it managed to get 165 million households to watch Squid Game “without having to premiere it after the Super Bowl. We didn’t need a big loss leader to build a mass audience.”

The NBA's "increasingly determined pursuit of an Upper Spending Limit" has been the No. 1 issue in their recent collective bargaining agreement negotiations with the NBPA. With the two sides nowhere close to a new deal, there will likely be an extension of the December 15th deadline for either side to opt out of the current agreement.

The league does not appear to be using the Upper Spending Limit, which is effectively a hard cap, as a negotiation tactic in order to gain concessions in other areas.

There is belief that a new system is needed for competitive balance.

"There will be a lockout before there’s a hard cap," one sources on the players' side told Marc Stein in October. 

The NBA and NBPA are nowhere close to a new collective bargaining agreement ahead of the December 15th deadline for either side to opt out of the current agreement.

An extension to the deadline is expected to be announced soon in order to extend the amount of time to negotiate a new agreement without a more imminent threat of a lockout next season.

With franchise valuations, revenues and player salaries continuing to increase, there are immense monetary incentives for both sides to avoid a work stoppage. 

Sources tell Marc Stein that the league's "increasingly determined pursuit of an Upper Spending Limit," which is effectively a hard cap, remains the No. 1 issue in recent negotiations. 

The NBA recently approved a rule change that allows sovereign wealth funds to buy stakes in teams.

An arm of a foreign government can now buy into the NBA, which is not yet permitted in any other major league in the United States.

Under the just-adopted policy, a foreign fund could buy up to 20 percent of a team. 

These sovereign funds are broadly found in oil-rich countries of the Middle East. These funds have helped increase the value of European soccer clubs with their purchases of Manchester City, Paris Saint-Germain and others.

Currently, there are no sales to sovereign funds under review by the NBA.

With franchise valuations continuing to soar, there could be fewer individual buyers who can afford such price points and opening up new sources of capital will help mitigate that issue.