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Update on Cavaliers/Chinese partnership


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http://www.cleveland.com/cavs/index.ssf/20...new_prospe.html

 

CLEVELAND -- After months negotiating and shuffling behind the scenes, the core of the new Cavaliers Chinese partnership has come to light and it centers around a high-profile Hong Kong businessman.

 

Multiple sources say that the primary investor and partner is Albert Hung, an influential and highly-respected businessman who is deep pocketed and deeply invested in Chinese sports and charities. Hung, whose proper Chinese name is Hung Chao Hong, has emerged as the leader after the ownership group, assembled by Chinese-American business specialist Kenny Huang, changed somewhat from the group that originally signed a deal with Cavs primary owner Dan Gilbert back in May.

 

Initially, members of the family that controls New World Development -- a large conglomerate of department stores, infrastructure companies and hotels -- were at the center of the deal to buy 15 percent of the team from former vice chairman David Katzman. But the makeup of the group has been altered, which has slowed the process of getting approval for the transfer by the NBA's Board of Governors.

 

Now, according to sources, it appears as if the deal will go forward within the next month or so. And while Huang, who was in Cleveland this week to formalize a sponsorship deal with the Cavs and Chinese beer giant Tsingtao, is still the point man on the purchase, it is Hung who is providing the cash, literally.

 

In an interview with CNBC, Katzman, who has had a significant falling out with Gilbert that has led a large-scale business divorce, said Hung had agreed to buy his percentage in cash. The value of the stake is estimated to be between $50-$70 million.

 

Hung is indeed one of the richest men in Hong Kong. He's invested in many businesses and has worked with American companies in the past as a distributor. Recently, he's used his money to invest in eco-friendly technology such as solar power development.

 

He's also a noted philanthropist and deeply involved in both charity work and youth sports initiatives, investing millions into facilities and leagues for Chinese schools and children. His resume is loaded with honors and seats on powerful and important committees.

 

In other words, exactly the sort of investor the NBA would like to have as its first significant owner from China, where it is working feverishly to create and develop new business. For Gilbert, who also counts former owner Gordon Gund as a minority owner, it gives him a liquid partner who can keep the team well capitalized.

 

Gilbert and Hung also have something else in common -- gambling interests. Gilbert is set to become of the owner of two casinos in Ohio in the next three years and Hung has been a member of the Football Betting and Lotteries Commission of Hong Kong.

 

But Hung is a member of numerous powerful groups and committees including: the Standing Committee of National Chinese People’s Political Consultative Conference, the Vice President of China Sports Foundation, Vice Chairman of Major Sports Events Committee, the President of All Stars Sports Association Ltd. of Hong Kong, and Vice President and Director of the South China Athletic Association.

 

Perhaps his most valuable political affiliation is with the Hong Kong Selection Committee, which is the group that elects the chief executive of the massive Asian commerce and cultural hub.

 

He has been given two major honors by the Chinese government. As a holdover from its days as a British territory, Hong Kong has several orders of merit for its top citizens. Over the summer, Hung was given the Silver Bauhinia Star, which is one of the highest ranks. According to reference books, it is awarded to persons who have taken a leading part in public affairs and/or voluntary work over a long period of time.

 

He's also been given the title of Justice of the Peace, which is given by the government to top community leaders.

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