The NBA world has been left stunned by the sudden news that, just one year after changing ownership, the Los Angeles Lakers are changing hands again. The team is being sold by Mark Walter to Joshua Kushner and Bob Iger for the staggering sum of $12.5 billion. Walter had paid $10 billion to acquire the controlling stake in the Lakers from the Buss family.

According to The New York Times, Kushner contacted Walter on Friday, and the deal came together rapidly over the weekend. Iger said the substantive discussions and negotiations lasted only a few days, with the final details agreed upon within roughly 24 hours.

“When you don’t have hordes of people, investment bankers and the like involved, it’s easier to keep things confidential and quiet,” Iger said, adding, according to Bloomberg, that no calls were made to investors to raise financing for the transaction.

The sale is widely viewed as a major investment success for Walter, as the Lakers’ valuation increased from $10 billion to $12.5 billion in just 14 months. The same source cited by The New York Times said Walter—who also owns the Los Angeles Sparks and has an ownership stake in the Los Angeles Dodgers—was not actively seeking a buyer; rather, the offer from Kushner and Iger was simply too attractive to refuse.

However, as both The New York Times and Forbes point out, there is an “elephant in the room” that may offer a different explanation for the sudden sale.

According to the two U.S. publications, Walter’s investment portfolio is reportedly the subject of a federal investigation. Federal prosecutors are examining whether there were financial irregularities involving two insurance companies he oversees, as well as Guggenheim Partners, where he is both a shareholder and chief executive officer.

Bloomberg has also reported that federal agents seized Walter’s cellphone last autumn. Investigators are reportedly examining whether Mubadala Capital was misled regarding the valuations of Walter’s companies before the Abu Dhabi sovereign wealth fund invested $10 billion in Walter’s firm, which acquired the Lakers a few months later.

These reports have caused considerable concern around the NBA. Agents representing Lakers players have reportedly been asking, “What on earth is going on?” while others are wondering whether Walter’s legal issues with the federal government may be more serious than previously believed.

The new owners

Bob Iger served for many years as Chief Executive Officer of The Walt Disney Company, which owns ESPN, ABC and, of course, Disney World. He has maintained a longstanding relationship with the NBA through his previous role, as Disney has been one of the league’s broadcast partners and rights holders since 2002, and he is known to have a close relationship with NBA Commissioner Adam Silver.

When Iger first stepped down as Disney CEO in 2020, he joined Thrive Capital as a partner. After returning to Disney in 2022, he left Thrive but rejoined as an adviser last April. That brought him into a business relationship with Joshua Kushner, who runs the venture capital firm and is the brother of Jared Kushner, the son-in-law of President Donald Trump.

Joshua Kushner, who currently owns a minority stake in the Miami Heat—a stake he will have to sell as part of the Lakers transaction—created Thrive Eternal this year to invest in “assets with characteristics that cannot be replicated by technology.”

Thrive Eternal had been expected to become the lead investor in a proposed commercial spin-off of FIFA, investing approximately $4.2 billion for a 20% stake. However, the proposal collapsed after it became public and sparked a backlash against FIFA President Gianni Infantino, placing his position under pressure.

Before the sale can be completed, in addition to the due diligence being conducted by the Kushner-Iger group, it must also receive approval from at least three-quarters of the NBA Board of Governors, the league’s team representatives.