Milwaukee Bucks co-owner Wesley Edens is in the process of purchasing Cloud9 Challenger's LCS spot, along with the rights to four of its players, according to a report by ESPN's Jacob Wolf.
The report, which cites unnamed industry sources, says the deal is worth $2.5 million. If approved by Riot, Edens would own the LCS spot, valued at $1.7 million, as well as the contracts of mid laner Hai "Hai" Lam, top laner An "BalIs" Van Le, support Daerek "LemonNation" Hart and AD carry Johnny "Altec" Ru, which were worth $700,000 collectively in contract buyouts. The report says that Cloud9 is likely to retain rights to C9C jungler Juan Arturo "Contractz" Garcia, who will move to Cloud9's LCS roster.
ESPN's sources said a previous deal between C9 and an investment group from the United Arab Emirates fell through, and Edens was next in line for the spot.
C9 Challenger had a successful first season in the NA Challenger Series, finishing first with a 3-2-0 record. After C9C successfully earned a spot in the LCS with their defeat of NRG eSports at the 2017 NA LCS Spring Promotion tournament, C9 were expect to sell the spot, since LCS official rules prevent organizations from owning a controlling interest in more than one team in a top-level LoL league.
C9's stated plan in forming their C9C roster was to earn a second spot in the LCS and sell it to another investor. Though there was speculation C9 would field some of C9C's players on another new Challenger squad in the 2017 season, which they would they would later also sell, a recent change to the LCS ruleset prohibits pro teams from sending a co-owned B-team to the Promotion Tournament in their region. The change was intended to remove the incentive to "farm" the Challenger Series.
Edens works with hedge funds and private equity via Fortress Investment Group, which he founded in 1998 and where he is currently a co-chairman of the board of directors. He and business partner Marc Lasry bought the Milwaukee Bucks in May 2014 for a reported $550 million. As part of the deal, both co-owners were forced to liquidate a $100 million minority share of the Brooklyn Nets.
The NBA has taken an increased interest in esports in 2016, with several other owners buying into the LCS this year. On Sep. 26, the Philadelphia 76ers acquired both Team Dignitas and Apex Gaming, merging the two into a unified Dignitas organization that will compete in the NA LCS in Apex's spot. At the time, 76ers CEO Scott O'Neil told theScore esports that there were competing offers to purchase Dignitas.
"The owners, the people that own NBA teams and NHL teams, are some of the most successful businessmen in North America," he said. "They're smart and successful and have the ability to buy organizations for a reason. I think where the opportunity lies is pretty clear: esports has a big bullseye on it."
The next day, Team Liquid sold their controlling interest to aXiomatic eSports, an ownership group that includes Magic Johnson and Golden State Warriors co-owner Peter Guber.
Even Lasry, Edens' co-owner, has invested in esports in the past, as one of his many investments was San Francisco-based mobile esports platform Skillz in September 2015.
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