The Cleveland Cavaliers are nearing a deal to sell a 5% to 10% stake in the NBA franchise to private equity firm Blue Owl. The deal values the NBA team and Cleveland WNBA team set to start play in 2028 at a combined $5.5 billion, according to someone familiar with the agreement.
Blue Owl’s sports strategy fund buys limited partner stakes in NBA franchises, a fund originally named Dyal HomeCourt. The fund already has stakes in the Atlanta Hawks, Charlotte Hornets, Minnesota Timberwolves and Sacramento Kings.
The Cavaliers declined to comment on the deal, while Blue Owl did not return a request to comment. Bloomberg was the first to report the stake sale.
Last year, Cavaliers owner Dan Gilbert hired Allen & Company to explore selling up to 15% of his NBA franchise. Gilbert will retain his majority stake in the team he bought in 2005 for $375 million, which was a record at the time for a standalone NBA franchise. In December, Sportico valued the Cavs at $4.86 billion in its NBA team valuations, which ranks 16th in the league.
NBA values have more than doubled over the past four years—and are up 1,300% over the past 15 years—to an average of $5.51 billion. Last year, the Boston Celtics ($6.1 billion) and Los Angeles Lakers ($10 billion) reached agreements to sell their franchises, with both deals at the time setting records for a sports team control sale price.
The Cavaliers are coming off an Eastern Conference finals trip, their first without LeBron James since 1992. The previous year included the second-best regular season record in franchise history at 64-18. This year’s roster was the NBA’s most expensive with a $217 million payroll, plus a luxury tax of roughly $67 million. Next year’s club already has Donovan Mitchell ($50.1 million) and Evan Mobley ($50.1 million) on the books and a $42.3 million player option for James Harden.
During Gilbert’s two decades as owner, the Cavaliers have made five NBA Finals—largely on the back of James—with the franchise’s lone title coming in 2016.
In 2024, Allen represented immersive media platform Cosm when it raised more than $250 million from investors, including Gilbert. The bank was also retained to lead the WNBA’s expansion process for its 16th team, with Cleveland ultimately rewarded a bid, alongside Detroit and Philadelphia, who start in 2029 and 2030, respectively.
Gilbert’s sports assets sit within Rock Entertainment Group and also include the Cleveland Monsters in the AHL and the Cleveland Charge in the NBA G League. REG also operates Rocket Arena, Cleveland Clinic Courts and Rock Entertainment Sports Network, a joint venture with Gray Media.
Gilbert made his first fortune in the mortgage business with Quicken Loans, which is now Rocket Mortgage. He has a net worth of $30.6 billion, according to Bloomberg.