LeBron-Knicks speculation pumps up MSG stock
Wall Street’s bulls are betting that LeBron James ends up
playing basketball in New York, not Chicago.
Despite President Obama’s hope that the NBA free agent will
leave his native Ohio for the Windy City, traders are betting that
the superstar will announce on Thursday that he’s leaving the
Cleveland Cavaliers to play for the New York Knicks.
Shares in Madison Square Garden Inc., the owners of the Knicks,
jumped $1.30, or 6.4 percent, to close at $21.57 Wednesday, adding
3 cents in extended trading. Volume was up dramatically at 1.7
million trades, more than five times the daily average of
The basketball star is set to announce his decision during a
one-hour special on ESPN at 9 p.m. Thursday.
James’ potential arrival in New York would boost the value of
the franchise by “hundreds of millions of dollars,” said Gabelli
& Co. analyst Christopher Marangi.
The team could see about 10 percent more revenue, while the MSG
network could get 10 percent more advertising revenue, he said.
“Would landing LeBron add to the economic value of the
enterprise? The answer to that is unequivocally yes,” he said.
“The second question is what are the Knicks’ chances of actually
getting him? The market is saying it thinks better of the chances
today than it did yesterday or before the weekend.”
Adding to the speculative chess board was Dwyane Wade and Chris
Bosh’s announcements Wednesday that they would play for the Miami
Marangi said those decisions instantly made Chicago a less
attractive option for James while Miami’s chances of winning the
NBA Finals would go up dramatically with all three stars on the
But the Knicks entered the free agency shopping spree with the
most salary cap room in the league with $34.1 million – enough for
two players earning the maximum salary. After the team’s
acquisition of Amare Stoudemire from Phoenix, it still had $17
million to spend on James.
An ESPN executive says James will announce his future NBA plans
within the first 10 minutes of Thursday night’s hourlong broadcast,
hosted by Jim Gray.
ESPN says Gray and James will be in one location. A person
familiar with the plans, however, tells The Associated Press the
interview will take place at the Boys & Girls Club of
The broadcast also will include a long-form interview with ESPN
personality Mike Wilbon and others via satellite from ESPN’s
studios in Bristol, Conn.