Five companies, including ESPN, are participating in the NBA's venture into China, investing $253 million for an 11 percent stake in what will be known as NBA China.
ESPN, a division of The Walt Disney Company, is joined by Bank of China Group Investment, Legend Holdings Ltd.; Li Ka Shing Foundation; and China Merchants Investments. Tim Chen, the former CEO of Microsoft Greater China, will lead the new entity as its CEO.
"This strategic investment expands our relationship with the NBA, a key partner who shares our vision of serving fans worldwide," ESPN president George Bodenheimer said in a statement.
The NBA, long cognizant of the enormous market potential, started its foray into China in 1979, when the then-Washington Bullets played a game against the Chinese national team. Today, a third of the league's Web site traffic is from China, on the Mandarin version. Yao Ming of the Houston Rockets has been able to translate his icon status in China to marketing and playing success in the United States. This year, he was joined by Yi Jianlian, who is with the Milwaukee Bucks, and when the two teams played in November 2007, the game was broadcast by 13 Chinese television outlets, three Chinese Web sites, and drew up to an estimated 200 million viewers.
"The opportunity for basketball and the NBA in China is simply extraordinary," NBA commissioner David Stern said in a statement. "The expertise, resources and shared vision of these immensely successful companies will help us to achieve the potential we see in the region. The strategic investment from these companies will allow us to continue working with the Ministry of Sport and the Chinese Basketball Association to grow our sport and emphasize, in both rural and urban Chinese communities, its contributions to fitness, healthy lifestyle and an appreciation of teamwork."
Robert A. Iger, President and Chief Executive Officer, The Walt Disney Company said, "We are delighted to be participating in this promising venture in what's become one of The Walt Disney Company's most important markets. This investment adds to our wide range of exciting businesses in China, from theme parks to retail outlets and from movie-making to mobile games."
Chen had already
been hired in October to serve as the CEO of NBA China. He is based
in Beijing, another office is in Shanghai, and NBA deputy commissioner Adam Silver said there
will be one in Guangzhou.
NBA China will be governed by a board of directors that will include representatives from the five investor groups, plus Indiana Pacers owner Herb Simon, Minnesota Timberwolves owner Glen Taylor, Silver, Heidi Ueberroth, the president of NBA global marketing partnerships and international business operations, and Stern.
"It's something we're very excited about. It signals the kind
of opportunity that's available both for the NBA and the growth of
the game of basketball," Silver said. "It's the culmination of 20
years of work in China, but having said that it's really just the
beginning of the opportunity."
Information from the Associated Press was used in this report.