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How Alex Rodriguez's $1.5B Timberwolves deal is in danger because of his breakup with Jennifer Lopez
Alex Rodriguez's deal with an e-commerce tycoon to buy the Minnesota Timberwolves for $1.5 billion seems to be in danger, and some insiders say his breakup with Jennifer Lopez is at least partly to blame.
Last year, the former Yankees slugger joined forces with Marc Lore, a billionaire who runs an online store and wants to build an eco-friendly city called "Telosa" in the Southwest desert, to buy an NBA team.
When A-Rod and Lore put down a $250 million down payment in July 2021, they were supposed to be equal partners. This cash investment and the assumption of a chunk of the team's debt gave them a 20% stake, according to sources close to the situation.
Three people who knew about the situation said that A-Rod didn't pay his full share at the time, so Lore had to pay the rest. Because of this, Lore now owns about 13% of the Timberwolves, while A-Rod has only 7%.
Jennifer Lopez and Alex Rodriguez in 2020.
An NBA source said, "Alex and Marc were supposed to be even." Alex couldn't think of his part.
Now, the terms of the deal say that A-Rod and Lore have to make the next 20% payment by the end of the year. Three sources confirmed that A-Rod is scrambling to get his half of the money he needs for the down payment as well as his share.
"I wouldn't be surprised if A-Rod became Lore's No. 2," a source said, predicting that Lore might buy more than half of the team and control it.
Lore told The Post that he and A-Rod still make all decisions together, but he didn't say whether he had a bigger stake than A-Rod or not.
"I couldn't think of a better partner than you. "He is one of my best friends," Lore said on Monday. "Alex is the only person I would rather work with than anyone else."
A-Rod and Lore first worked together in 2020 to try to buy the New York Mets. At the time, A-Rod was dating Lopez, and sources close to the situation say that this seemed to play a role in how close he became to Lore.
"The J. Lo thing completely hypnotized Marc," said a person who knows both investors.
Sources close to the situation say that A-Rod often asked potential business partners to meet at the power couple's fancy homes in Bel-Air and the Hamptons, where Lopez was usually present.
The source said, "You always took your A-Rod meeting with J.Lo." "She's wearing workout clothes and going in and out of the room."
A source said that A-Rod always made it seem like they were investing together.
Lore, who started Diapers.com and sold his grocery startup Jet.com to Walmart in 2016 for $3.3 billion, and A-Rod eventually lost the Mets auction to hedge-fund billionaire Steve Cohen, who bought the team in 2020 for $2.4 billion.
Rodriguez, who is 47 years old, started dating Lopez at the beginning of 2017. In 2019, he proposed with a 16-carat emerald-cut diamond ring that was estimated to be worth $1.8 million. But they broke up and called off the engagement in the spring of last year, just one month before J.Lo started dating Ben Affleck again, whom she married this month in a big ceremony.
A-Rod and Lore put in a bid for the Timberwolves shortly before they broke up. According to sources, A-Rod wasn't financially ready for the breakup.
Sources say that A-Rod may be worth $500 million on his own, but that very little of that is likely to be cash. Sources say that he owns part of a $1 billion real estate portfolio with tens of thousands of apartments and homes, some of which are in the Minneapolis area.
Some insiders say that A-biggest Rod's problem may be that he no longer has J.Lo to help him win over co-investors. Recently, a 25-year-old fitness competitor from Dallas named Kathryn Padgett has been linked to Rodriguez in a romantic way.
“His ability to raise capital went from strong to meaningfully weaker,” believes a source who knows A-Rod well. “J.Lo validated him.”
If A-Rod and Lore make their next payment by the end of the year, they will have the chance to buy an extra 40% of the team and take control by the end of 2023.
An NBA source says that Glen Taylor, the owner of the Timberwolves, won't be too upset if the pair fails. Taylor thinks the team is worth about $2 billion more now than when they made the deal. He also thinks he can make more money by starting a new sales process.
No one from the Timberwolves called back.
"Glen has been a good partner, and we have learned a lot from him," A-Rod told The Post.
Still, it's not clear if A-Rod will be able to make money off the price he's locked in. Part of the reason is that NBA rules say he can't become an owner unless he can pay for 15% of the total purchase price on his own. When the team's debt is taken into account, that comes to almost $200 million.
If Rodriguez doesn't get a 50% stake, he and his co-investors could end up putting money into the team without having a say in how it is run.
In such a nightmare situation, "you will be a minority to the minority," a person who knows about the situation said.
Lore and A-Rod did a media tour in July 2021 to promote their new business partnership, VCP Ventures.
“We have a lot of similarities,” A-Rod told Bloomberg TV. “We are both from New York. We both have two daughters. We are both mission driven.”
But the only investment VCP talks about is a $1.9 million commitment to online store Thoughtful in June 2021. Thoughtful sells ways to keep track of and remember important events and details, and the VCP website says that the money will go toward this.
Two sources say that he made about the same amount before taxes when he sold the online shopping site Jet.com to Walmart.
Lore has put a lot of money into his food delivery company, Wonder, which raised money in June at a $3.5 billion valuation, according to reports.