Ariel Investments Founder John Rogers Talks New York Knicks Finals Win

**SPEAKER_1** (0:02)
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**Romaine Bostick** (0:07)
Our next guest, he's been all in really on some of these Jim Dolan businesses for quite some time. A long time investor in MSGS, the sports business, at least a decade, and the largest holder in MSG entertainment. John Rogers joins us right now, the legendary value investor. He's the founder, chairman, co-CEO, and CIO over at Ariel Investments. John, great to have you here. We've talked a lot over the years, and you've always been banging the drum here on the value, and more importantly, some of the unlocked value in the MSG stocks. Let's start with MSGS. This is the business that includes the Knicks, as well as the hockey team, the New York Rangers. I know it's hard to sort of put a valuation on sentiment, but when you walk around this city, and you feel the excitement, you see jerseys and all the paraphernalia selling out. You're already getting words here that whatever season tickets are going to look like for the next season are going to be a lot higher.
Does that mean that the value of this stock goes up with it?

**John Rogers** (1:06)
Well, as you know, markets are so efficient, and even with all this excitement and all this enthusiasm, you know, the stocks have done extremely well over this last year as people started to see the team coming together, starting to see a gel, and as the playoffs have gone on, the stocks have made new highs. So, I do think it's going to be a good year. I think there's going to be still more good news, but a lot of the good news is already incorporated in the price of the publicly traded companies.

**Romaine Bostick** (1:35)
There has been some discussion prior to this series that there was the idea that they would actually split MSGS into two separate stocks, basically one stock for the Knicks and its WNBA counterpart and another for the hockey team, the Rangers, and its counterpart in the minor leagues here. Do you think that that would be a good idea to do at this time?

**John Rogers** (1:59)
I think it's an excellent idea to split the two companies up. I think it will make it much easier for a private equity investor to put capital into either of the companies or both companies. It will be easier for Jim Dolan if you want to sell one of the companies.
He might want to sell at these all time highs, as the stocks have done so extraordinarily well. He will get out on top and realize the valuation will probably never be higher than what's happening during this environment after this iconic championship and again all the excitement of New York City. So, the spinoff and splitting up the two companies, splitting up into two companies is a really I think a terrific idea.

**Romaine Bostick** (2:36)
Well, I am curious about that. You've talked in the past about this stolen discount, the idea that for better or for worse, are there a lot of people that don't look favorably on Jim Dolan as a person and to a certain extent as a manager. And I do wonder if some reason he was willing to sell here at the top, whether that would be welcome by investors like yourself.

**John Rogers** (2:57)
Well, I think investors would love it because the stocks have not reflected the entire value of these franchises. As we know, the Knicks were been rumored to be worth 10, 11, maybe now it will be 12 billion dollars.
Probably the highest priced basketball team in history if it were ever to be sold. So it would be the time to really take advantage of all the enthusiasm. You can imagine all those billionaires that are out there would want to be part owner of the New York Knicks and to be able to be in Madison Square Garden, celebrating the next championship as an owner. So it is the right time to be thinking about a sale, and again, to be able to realize the value. Because the markets have never really reflected the true underlying asset value of Madison Square Garden Sports and the Knicks and the Rangers.

**Katie Greifeld** (3:47)
Well, it will certainly be interesting to follow along and see what decision Jim Dolan ultimately makes. But I do want to talk about your other exposure that you have to his sort of publicly listed portfolio here. Of course, Ariel Investments, also a big holder in Sphere Entertainment. And I just wonder how you think about that fitting in when you think about, okay, MSG is one thing, think about the Knicks exposure that you have there. How does Sphere factor in?