Unless you’ve not been on the Internet at all in the past week, you’ve no doubt heard of the madness on Wall Street in which Reddit users bought an insane amount of obsolete stocks to undermine hedge funds, especially GameStop, which called for several investment platforms start trading limited with what they call ‘meme stocks’. Some people made a lot of money, but others lost millions, including Charlotte Hornets minority shareholders Gabe Plotkin and Daniel Sundheim, who bought a stake in Michael Jordan’s team in 2019.
Both apparently suffered huge losses, which of course affects the six-time NBA champion, who himself has lost a lot of money over the past year and may have to find new investors.
Michael Jordan sold a stake in the Charlotte Hornets to Gabe Plotkin and Daniel Sundheim in 2019
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Michael Jordan first bought a minority stake in the Charlotte Hornets franchise in 2006, when the team was still known as the Bobcats. He took control of the basketball side of the business and maintained control when he became the majority owner of the Hornets four years later, making him the first former player to become the majority owner of an NBA franchise and also the only one. black majority owner of the league. .
In 2019, Jordan sold a minority stake in the Hornets to hedge fund titans Gabe Plotkin, founder and chief investment officer of Melvin Capital, and Daniel Sundheim, founder and CIO of D1 Capital, both of whom were hit hard by the GameStop trade. war this week.
Charlotte Hornets minority owners Gabe Plotkin and Daniel Sundheim have reportedly suffered heavy losses in the GameStop trade war
For those unfamiliar with what happened in the GameStop Trade War this past week, here’s the short version of what went down.
GameStop, the video game retailer whose shares fell back in December after the company failed to meet Wall Street’s quarterly revenue estimates, was one of a few obsolete shares subscribed by Reddit forum subscribers called ‘wallstreetbets’. ‘has been targeted. The users encouraged each other to buy GameStop shares in large quantities to undermine hedge funds that had short selling positions on the stock.
Charlotte Hornets, minority owners Gabe Plotkin and Daniel Sundheim, both took this stand and wanted to make money when the price of GameStop shares fell and lost money when it rose. Well, the price definitely went up because the Reddit users were able to increase the GameStop share price by 1700% in January, which resulted in huge losses for Plotkin and Sundheim, which could have caused problems for Michael Jordan.
Although there are not many details about Sundheim, CNBC reported that Melvin Capital of Plotkin, which closed its short position on GameStop on Tuesday due to the short press, had to put $ 3 billion out of Citadel and Point 72 to raise its finances sharp, although there is alleged to be false about a bankruptcy filing.
So, how does this affect Jordan? According to Radio.com, there were rumors that MJ might want to sell more of his Charlotte Hornets shares, and that Plotkin and Sundheim would even hope to buy the team straight. This, of course, is just pure speculation.
But even if these things are not true, there is now a good chance that one or both minority owners will have to investigate the sale of part of their stake in the team to the losses they incur as a result of the GameStop situation. suffered, to cover. This could mean that Michael Jordan may have to start looking for new investors.
Michael Jordan reportedly lost $ 300 million last year
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While Michael Jordan himself did not lose any money during the GameStop trade war (which we know of anyway), it is not as if he experienced the biggest year financially, at least as far as the Charlotte Hornets are concerned.
As with every NBA team since the onset of the COVID-19 crisis, Hornets have been polluting blood for almost a year now. Jordan’s net worth has reportedly fallen in the region of $ 300 million over the past year or so, which may be the reason for rumors that he may want to sell more interest in the team.
But it’s not like Jordan’s going to be hungry anytime soon. Even with the loss of $ 300 million, the two-time Hall of Famer is still worth about $ 1.6 billion, according to Forbes, making him the richest retired athlete on the planet.