Two Brothers Made $800 Million From NBA Without Ever Owning a Team

The NBA was not as big a league in the 1960s as it is today. In 1967, the ABA was founded which was in direct competition with the NBA. The ABA had a history of being more scoring-heavy. Whereas, the NBA witnessed its prime defensive era with the legendary Bill Russell as the face of the league. However, more important than the players, there are elements in the history of these two leagues that mark what could possibly be the best deal in the history of sports.

Two brothers, Ozzie and Daniel Silna have done what any other franchise owner could only dream of. They walked away with an 80000% return on their investment. That means they walked away with 800 times the money that they had initially invested. And that too without technically ever owning a franchise in the NBA. So what is this deal that has been tagged as the best deal in the history of sports?

Daniel and Ozzie Silna walk away with $800 million

In 1974, Daniel and Ozzie Silna purchased the ABA’s Carolina Cougars for $1 million. Subsequently, they shifted to Saint Louis and rebranded as the Saint Louis Spirits. The sole reason they had purchased this team was that the lack of revenue and operating expenses showed the NBA will soon merge with the ABA. And fortunate for them, they were right.

The NBA ultimately consented to a merger in 1976, tired of fighting for players and fans. The New York Nets, Denver Nuggets, Indiana Pacers, and San Antonio Spurs were selected as four of the seven ABA teams to make the jump to the NBA. They expected the remaining 3 to be bought out to disband. And 2 of them did for $3 million. However, the Silna brothers held out for longer in lieu of getting a better offer.

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Eventually, they agreed on a $2 million instant cash buyout. That might seem absurd to anyone. But there was a catch. They included a clause in the deal that was undoubtedly pure genius. The clause said the remaining 4 teams who made it to the then-new NBA, would owe 1/7th of their yearly TV revenue to the brothers. Further, the contract went into perpetuity. It stated that this clause would stand “for as long as the NBA or its successors continues in its existence”. Therefore, the NBA had a life-long obligation to ensure that these 4 teams pay 1/7th of their revenue to the Silna brothers.

How did the NBA settle this deal?

Considering that no one expected the NBA to blow up as it did, the owners of the 4 teams agreed to this deal. However, now in 2014, the NBA ultimately opted to settle its unending obligation with the Silna brothers, with more profitable television contracts likely to be renegotiated. The two brothers received a $500 million buyout in 2014, raising their total earnings to $800 million. Absurd, isn’t it?   

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