The Lakers at $12.5B reads better as a deduction than as a basketball team

Thrive Capital founder Joshua Kushner and former Disney CEO Bob Iger have agreed to buy the Los Angeles Lakers for a record $12.5 billion, pending approval ^[1][2]. That is 25 percent above the $10 billion Mark Walter paid for the same franchise in 2025 ^[12][1], and Fortune's report on the deal contains no revenue, EBITDA, or operating cash flow figure for the team ^[22].

The most specific explanation in circulation is a tax one, and it comes from outside the deal. Ram Ahluwalia, founder of Lumida Wealth Management, posted on X on Saturday that the purchase has nothing to do with sports teams as an asset class and is instead "a powerful tax shield" ^[4]. His stated guess is that Kushner is "preparing to offset a boatload of carried interest income," and that the point of buying a team is to establish a "non-passive" deduction against ordinary income ^[5]. Ahluwalia tied that to Kushner's positions in SpaceX, OpenAI and Stripe, which he expects to generate large gains, and argued the deduction profile beats real estate ^[6][7]. Thrive Capital did not immediately respond to a request for comment ^[10].

The mechanics are not exotic. Media rights get amortised; player contracts and stadium infrastructure are treated as depreciable ^[13]. A roster counts as an intangible asset that wears out on paper, producing losses that offset the owner's taxable income elsewhere ^[14]. None of this requires the business to be losing money: the shelter operates while the franchise appreciates and operations stay profitable ^[15]. Regional broadcast deals can also be structured to move income into units with better rates ^[16]. Ahluwalia's precedents are Warren Buffett depreciating goodwill on brands such as See's Candies and Dairy Queen, and Mark Cuban at the Dallas Mavericks, who he says grew equity value while converting high-rate income into lower-taxed capital gains, calling that "a trifecta" ^[8][9].

If the shield is real, it changes what the price means. A buyer valuing a team partly on the ordinary-income tax it displaces is not bidding against other teams' cash flows; he is bidding against his own marginal rate. That would help explain a ladder that has moved fast: the Boston Celtics set a record at $6.1 billion in 2025 ^[12], Vinod Khosla agreed to buy the Seattle Seahawks for $9.6 billion last month ^[11], and the Lakers now clear roughly 2.05 times the Celtics price ^[2] and 30 percent above the Seahawks ^[3].

The competing explanation is more mundane and better sourced to a participant. David Silverman, a Cooley M&A partner who worked on the Celtics sale, told Fortune last month that long-term media deals have made team revenue steady enough that a franchise stays profitable "regardless of the number of people that shows up" ^[17], that consumer spending is shifting toward in-person experiences ^[18], and that values have compounded faster than most asset classes ^[19]. He also named the intangible: access to "a very elite and exclusive club of owners" and the business opportunities that follow ^[20].

Watch three things. Whether league approval attaches conditions ^[2]. Whether Thrive says anything at all about structure, having so far said nothing ^[10]. And the next comparable sale, which will show whether the $12.5 billion mark travels to franchises without 17 championships and a LeBron James lineage ^[3].