MSG Sports Considering Spinning Off New York Knicks, Rangers

Randall Williams, Bloomberg US Sports Business Reporter, discusses Madison Square Garden Sports' plan to separate its New York Knicks business from its New York Rangers business.

Madison Square Garden Sports Corp.’s board of directors approved a plan to explore spinning off the NBA’s New York Knicks and NHL’s New York Rangers, a move that would make it easier to attract investors to the teams.

Few sports conglomerates are worth more than the combined value of the Knicks and Rangers, who both play at Madison Square Garden, one of the most famous arenas in the world. Sportico values the Knicks at $9.85 billion, third in the NBA. The Rangers are worth $3.65 billion, second in the NHL behind the Toronto Maple Leafs.

Shares of MSG have soared in recent months, driven in part by the strong performance of the Knicks. Recent earnings have also been boosted by the NBA’s new national media rights deal. However, MSG was valued at just over $7 billion at the end of trading Tuesday, far below the combined value of its assets.

MSG said in a statement Wednesday that the potential transaction would allow its shareholders to better evaluate each team’s overall valuation. Shares in MSG rose over 16% in New York, the most since Nov. 2020, adding about $1 billion to its market value.

The Knicks have long been owner Jim Dolan’s most controversial asset. While the franchise failed to capture a title in the 90s — their last championship came in 1973 — the team in that era was seen as a gritty contender, with stars like Patrick Ewing and John Starks. The Rangers last won the Stanley Cup Finals in 1994.

The Knicks made it to the Eastern Conference finals for the first time in 25 years last season, before ultimately falling to the Indiana Pacers. The Rangers have missed the playoffs the past two seasons after going to the postseason three straight years from 2021 to 2023.

Dolan has been reluctant to sell the Knicks, though the franchise has been an acquisition target for years. In 2023, former MSG president and COO David Hopkinson said the franchise would consider selling minority stakes in either team. Investment firm Silver Lake Management owns a 10% stake in MSG Sports. The Knicks has been speculated as the next NBA team that might see investment from a Middle East investor. Silver Lake has strong ties with Abu Dhabi’s Sheikh Mansour Bin Zayed Al Nahyan and is a co-investor with him in Premier League giant Manchester City.

Read More: Celtics Owner Pitches UAE Sovereign Wealth Fund on Stake in Team

Sports franchise valuations have continued to rise in New York. The Koch family bought a 15% stake in BSE Global, the parent company for the Brooklyn Nets and New York Liberty at a $6 billion valuation in 2024. The following year, the Kochs bought a 10% stake in the New York Giants at a valuation of over $10 billion, the highest price ever for a transaction in the NFL.

If the spinoff is completed, the Knicks would also house its NBA G League affiliate, the Westchester Knicks, while the Rangers would have the Hartford Wolf Pack, a minor-league hockey team in the AHL.

“Both the Knicks and Rangers are premier teams in their respective leagues, with storied histories and large and passionate fan bases,” Chief Executive Officer Dolan said in a press release. “We believe this proposed transaction would provide each company with enhanced strategic flexibility, its own defined business focus, and clear characteristics for investors.”

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