Forest City Enterprises, the management and development company owned by Bruce Ratner that owns 20 percent of the Brooklyn Nets and 55 percent of Barclays Center through its subsidiary Nets Sports & Entertainment, paid $26.8 million in capital calls/fees yesterday to protect its ownership stake in the team.
NS&E faced the potential of seeing the company’s shares in the team dilute from 20 percent to 8 percent had the payment not been made. The company confirmed it is still looking for a sale, saying in a statement that “it remains in active discussions with interested parties for a potential sale.”
Ratner, who stepped down as the CEO in 2013 and now serves as the Executive Chairman of Forest City Ratner Companies New York, was the majority owner of the Nets before Mihkail Prokhorov agreed to buy 80 percent of the team in 2010. His presence, as well as the presence of the Atlantic Yards Project (since renamed Pacific Park) has been divisive in the Brooklyn community.
It should be made clear that Ratner does not own 20 percent of the team outright. Ratner’s Forest City Enterprises owns 62 percent of NS&E, with the remainder of that subsidiary owned by various minority partners.
The total payment is cause for some debate. FCE originally had until August 12th to make the payment, reportedly for $31.3 million — a $25 million as part of the forbearance agreement and an additional $6.3 million in capital call. but Prokhorov & the Nets agreed to extend the deadline until September 8th, with the hopes that they could entice a potential buyer to take on NS&E shares.
It’s possible that Prokhorov waived the upcoming season’s capital call, which could mean he’s close to buying the whole share of the team and Barclays Center before the beginning of the season. FCE declined to comment on the discrepancy in payments.