Report: Mat Ishbia pledged more than half of his company’s outstanding stock to buy Suns
Sep 5, 2023, 9:06 AM
Then-incoming Phoenix Suns owner Mat Ishbia laughs during the game between the Detroit Pistons and Phoenix Suns at Little Caesars Arena on February 04, 2023 in Detroit, Michigan. (Photo by Nic Antaya/Getty Images)
(Photo by Nic Antaya/Getty Images)
When Mat Ishbia was officially approved as the owner of the Phoenix Suns and Phoenix Mercury in February, he made it clear he loved the game of basketball.
“This is the culmination of a lifelong dream,” Ishbia said in a release through the team. “I love the game of basketball deeply but it’s so much more than that for me.”
About seven months later, a report from Bloomberg revealed he wanted the Suns so badly, he was willing to pledge “slightly more than half of (his company UWM Holding Corp.) outstanding stock,” to pay the $4 billion price tag. JPMorgan Chase & Co. is the lender on both deals, according to the Bloomberg report.
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According to Bloomberg, Ishbia controls UWM Holdings through another company, SFS Holding Corp., which includes his brother Justin, managing partner of Shore Capital.
In February, Arizona Sports’ John Gambadoro reported the brothers will collectively own 57% of the team. Mat Ishbia serves as the team governor while his brother is the alternate governor.
While the Bloomberg report notes executives of publicly traded companies commonly pledge shares as collateral, Ishbia tying up more than half his shares as collateral is unusual.
The risk, Bloomberg reported, is if the value of the stock declines lenders can request additional collateral and for the loan to be repaid or the lender can seize and sell the shares. UWM went public with a $16 billion valuation.
The $4 billion sale is the largest purchase in NBA history. Joe Tsai bought the Brooklyn Nets and Barclays Center for $3.3 billion in 2019, and Tilman Fertitta purchased the Houston Rockets for $2.2 billion in 2017.
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