Did Michael Jordan Really Lose $300M Due to GameStop Trading Fiasco?

Published 02/03/2021, 5:08 PM EST

Around one and a half years ago, when Charlotte Hornets’ owner Michael Jordan sold some minority stock to Melvin Capital’s founder Gabe Plotkin and D1 Capital’s Daniel Sundheim, it seemed like a good deal for the Hall Of Famer.

Fast forward to 2021, the Charlotte Hornets’ owners find themselves in deep trouble. Gabe Plotkin and Daniel Sundheim have approximately lost a total of $5 billion dollars in the ongoing GameStop trading inferno.

The two hedge funds were allegedly short on selling GameStop’s stocks. But a bunch of investors from the WallStreetbets subreddit initially started to observe the position these hedge funds took.

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And then they started investing aggressively in the company. This resulted in the surge in the prices of the stock from $18.84 on December 31, 2020, to $325.00 at the end of January’s final trading session, a whooping 1700% rise in the stock prices.

This surge in the stock prices hit multiple hedge fund big shots. Hornets’ minority owners were also hit by the same. They lost 30% of the available assets worth $5 billion dollars. They also required a significant bailout to stay afloat. After such a disastrous loss, the firm has closed its position in the market and cut its losses.

How has the GameStop trading fiasco affect Charlotte Hornets and Michael Jordan

Although Michael Jordan is directly not involved in the trading fiasco, there might be dire consequences for Michael Jordan. According to reports, Jordan had sold a significant amount of stake to Plotkin and Sundheim.

Before this fiasco though according to TrueHoop, there were rumors of the co-owners planning to buy the team. With the losses they have had, it is highly unlikely that they will sell most of their assets to buy the team.

Besides the scandal, 2020 was a disastrous year for all the owners, especially MJ. The coronavirus pandemic affected the league badly with losses all across the board. Jordan on the other hand lost $300 million from his market value, bringing it down to $2.1 billion.

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All of this has led to a big question marks over the ownership of the team. Jordan is still the majority owner, but should he sell more of the stake to other investors?

The team’s value has increased approximately tenfold to around $1.3 billion in the last ten years, thanks to the expensive broadcasting deals and the increasing exposure of the league.

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This increase in their value hasn’t resulted in overall success for the team, however, who have made the playoffs only once in the last ten years. They are showing some signs as a solid team centered around players like LaMelo Ball and Gordon Hayward.

They are currently the eighth seed in the league and will hope to make it to the playoffs this season.

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Written by:

Aditya Mohapatra is a sports enthusiast who primarily covers the NBA for EssentiallySports. Having graduated in Mass Communication, he has prior experience in writing for ABP News, and has been writing for EssentiallySports since November 2020. This die-hard Los Angeles Lakers fan feels that LeBron James is the best thing to have ever happened to the NBA, and will hold a healthy debate with anyone suggesting otherwise.

Did Michael Jordan Really Lose $300M Due to GameStop Trading Fiasco?

How has the GameStop trading fiasco affect Charlotte Hornets and Michael Jordan

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