David Tepper, president + founder of Appaloosa Management, is an investment guru, philanthropist and hedge fund mogul. He was ranked #5 on Forbes’ list of The World’s Richest Hedge Fund Billionaires 2017. He has a net worth of $11 billion.
Now he holds the winning bid to purchase the Carolina Panthers. He got the green light this week to write his check when all 32 league owners unanimously said he could join their club. That is, of course, after he sells his minority stake in the Pittsburgh Steelers. One team at a time, David.
But this isn’t the first time he’s bet on Charlotte. His company, Appaloosa, made a $7 billion profit by buying shares of Charlotte-based Bank of America + Citigroup when other investors were turning away from banks.
He says he has no intentions for now to move the team. I wouldn’t either if the team’s stadium was already named after the company that helped me buy the team.
So, you want an NFL team too? Here’s how David did it.
He will drop $2.275 billion (mostly in cold hard cash) to acquire the Panthers from former owner Jerry Richardson this summer, which is the most money ever spent to buy an NFL team (the previous record high was $1.4 billion for the Buffalo Bills in 2014).
Can you imagine writing a check for $2,275,000,000.00? They must make special checks that are longer for guys like this.
Even more mind-boggling? The sale is considered a bargain. Forbes had valued the Panthers at $2.3 billion last September, and the Panthers originally put themselves on the market with a “minimum” $2.5 billion asking price.
The 60-year-old, Florida-based New Jersey native didn’t have this money fall into his lap.
💰 1985 | Tepper started working at Goldman Sachs, where he worked for seven years – first as a credit analyst, then quickly advancing to a lead, high-yield desk trader.
💰 1989 | Tepper purchased distressed bonds of banks rattled by the junk bond market crash, making Goldman Sachs a lot of money.
💰 1992 | After not making partner at Goldman Sachs, he left to start his hedge fund firm, Appaloosa Management, with $57 million in capital. The firm made most of its fortune by investing in the debt of companies in trouble. (What’s a hedge fund? A type of investment system that takes funds of wealthy investors and institutions to make bets on stocks + bonds.)
💰 mid-late 1990s | Tepper took a chance on buying a percentage of several countries’ debts (including Argentina, South Korea and Russia) that he predicted would recover from economic crisis, which earned him returns of 42%, 30% and 60%, respectively.
💰 2000s | During America’s own financial crisis, Appaloosa assets rose from $57 million to $13 billion. That’s a 22,707.02% increase.
💰 2009 | Appaloosa made a $7 billion profit by buying shares of Charlotte-based Bank of America + Citigroup when other investors were turning away from banks. Tepper knew the government would not let banks fail for long.
💰 2016 | Tepper relocated himself (from being the richest man in New Jersey) and the company to South Beach – where he became the second wealthiest man in Florida. Florida has no personal income tax, while New Jersey has one of the highest in the U.S. – 8.97% for those with an income of $500,000+.
💰 2018 | Today, Appaloosa manages ~$17 billion and has been returning money to clients in recent years. $1 million invested in Appaloosa when the firm was founded would be worth $181 million today. If we could turn back time.
