Thunder in court tussle on franchise value

NEW YORK • The Oklahoma City Thunder are one game away from clinching a spot in the National Basketball Association (NBA) Finals.

However, away from the roar of fans and the glare of cameras, another battle involving the basketball team is brewing in a probate courtroom in their home city.

At stake is a roughly 20 per cent interest in the Thunder held by Aubrey McClendon, the indebted Oklahoma energy magnate who died in a car crash on March 2.

Some of McClendon's creditors want a say over how the stake will be disposed of by his estate, viewing the basketball team as one of his few assets of value, according to a copy of a transcript from a May 13 hearing in probate court.

The lenders want the stake to be sold for top dollar, but fear it will be sold for less than that to McClendon's wife Kathleen, because she is family, said a lawyer representing a syndicate of banks led by Wilmington Trust that loaned US$465 million (S$641 million) to American Energy Partners, a company McClendon founded in 2013.

"We have been advised that Katie McClendon wants to purchase that Thunder interest," said the attorney, Arthur Hoge, in a court transcript.

"If we have a reason to question a sale, because we don't think it's an arm's length fair market value sale... we should have the right to come address that with the court."

Attorneys for McClendon's estate said the creditors were getting ahead of themselves and should not be intervening in the probate process. They said the Thunder is not for sale at this stage, and any sale would need to satisfy qualifications set by the NBA.

"We certainly don't want the creditors to think we're going to overreach them, but the assertion that we could sell the Thunder interest without letting them know is absurd," Martin Stringer, an attorney for the estate, said in the transcript.

Hoge did not give a value for the Thunder stake at the probate hearing. Forbes valued the Thunder at US$950 million in January.

REUTERS

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A version of this article appeared in the print edition of The Sunday Times on May 29, 2016, with the headline 'Thunder in court tussle on franchise value'. Print Edition | Subscribe