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NBA

Why is Alex Rodríguez struggling to buy the Timberwolves without Jennifer Lopez?

Former MLB star Alex Rodríguez is finding it difficult to raise the capital for the Wolves deal after his divorce from actor and singer Jennifer Lopez.

Update:
Jennifer Lopez puts Alex Rodríguez's Timberwolves takeover on hold

The proposed $1.5 billion takeover of the Minnesota Timberwolves by Alex Rodríguez and Marc Lore has hit the buffers due to the former New York Yankees star’s liquidity problems, which reportedly stem from his breakup with Jennifer Lopez. The three-times MLB MVP has an estate valued at about $500 million but the vasy majority of it is in the form of property.

That is to say that Rodríguez has a vast fortune, but no access to cash to meet the agreements entered into with e-commerce tycoon Lore and current Wolves owner Glen Taylor. The first of these was an initial $250m downpayment to acquire a 20% stake in the franchise. However, Rodríguez was unable to cover his full share and Lore had to make up the shortfall, leading to a disparity in the percentage of ownership: 13% for Lore and 7% for Rodriguez.

Alex and Marc were supposed to be 50/50. Alex couldn’t come up with his half,” an NBA source told The New York Post. The next payment, to acquire a further 20% of the Wolves, has to be made before the end of the year and Rodríguez does not appear to have the liquidity necessary to meet his share of the investment, which could mean the former MLB star ends up becoming a minority shareholder in the venture with Lore as the Wolves’ owner.

The Jennifer Lopez factor

Rodríguez’s economic issues are linked to his relationship with Lopez. According to The New York Post, the actress and singer was a magnet for her ex-husband’s business partners. “Marc got completely mesmerized by the J. Lo thing,” the source, who is familiar with both investors, said. Rodríguez and Lore made an unsuccessful bid to gain control of MLB franchise the New York Mets in 2020.

Lopez was always present with Rodríguez during meetings at his luxurious homes in Bel-Air and the Hamptons and many of the former player’s associates believed they were doing business with the couple. “You always took your A-Rod meeting with J. Lo,” the source added. “She is coming in and out of the room with workout clothes. A-Rod always made it seem like they were investing as a couple.”

The divorce caught Rodriguez off guard financially and he was no longer able to count on Lopez to attract investors: “His ability to raise capital went from strong to meaningfully weaker,” a source close to Rodríguez told the US media outlet.

As well as the prospect of a minor role in the Timberwolves venture, there is the prospect that the deal could collapse entirely, a scenario that Taylor would not necessarily be overly disappointed about: the Wolves owner believes that the value of the franchise has increased by $500m to $2 billion since the deal with Rodríguez and Lore was agreed. A new round of bidding would therefore generate much more profit for Taylor.

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