James is excited for new team partner

By BRIAN WINDHORST

ORLANDO, Fla. — The Cavaliers’ new business partner is a huge multinational corporation with billions in assets.

According to multiple NBA sources, the team’s central new Chinese investor is New World Development Company, a Hong Kong-based conglomerate. It has over $21 billion in assets in hotels, convention properties, department stores, telecommunications, infrastructure projects and even financial services mostly in Southeast Asia.

New World owns a string of Marriott-brand hotels in Hong Kong, Beijing and Manila along with other brands that would be familiar to Americans, including a Hyatt. They are known in mainland China for their department stores in 17 different cities.

In other words, it is a financial powerhouse with numerous ways to take advantage of its pending investment in the NBA. Combined with Cavs owner Dan Gilbert, whose Quicken Loans company weathered the mortgage crisis and emerged with more market share, the Cavs potentially will have some of the deepest backing of all the teams in the NBA.

LeBron James said before Game 3 of the Eastern Conference Finals on Sunday that he was excited about the prospect of the Asian investment.

“It’s a big market; they love the game of basketball,” James said. “I’ve been over there the last four or five summers, and I know how much they are inspired about the game of basketball. So it could be good. It should be fun.”

Gilbert received interest from New World months ago when he made it known that former business partner David Katzman wanted to sell his share. The deal was brokered by Kenny Huang, a respected and established dealmaker in the Hong Kong marketing community that has been setting up partnerships with American sports teams for years.

Huang, who has been working with the Cavs on Chinese sponsorships for the last two years, was able to assemble the buyer group when he learned part of the team was available. Team sources said the only reason the club looked for new owners was because Katzman wanted to liquidate his shares.

Despite committing more than $100 million to payroll including luxury taxes this season, the team still has a chance to turn a profit with its long playoff run.

It is expected that Huang, who maintains homes in Hong Kong as well as New York, will be the group’s representative with the Cavs and perhaps even be given a title within the team for next season.

The Chinese investors will have the second-largest percentage of team ownership behind Gilbert, who will remain as majority owner and will retain the final say on all matters with the franchise.

The investment will not be finalized until it is approved by the NBA’s Board of Governors, especially the other 29 owners. The next meeting won’t be until the fall but votes on ownership change can be done by proxy.