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Knicks and Rangers Split Up. James Dolan Gets $10 Million.

Madison Square Garden’s two marquee teams now trade as separate stocks, and the man running both was paid handsomely for making it happen.

Vault Editorial
2–3 minutes

Madison Square Garden’s two marquee teams now trade as separate stocks, and the man running both was paid handsomely for making it happen.

For the first time, Wall Street can bet on the Knicks without buying the Rangers. Madison Square Garden Sports finished splitting its two franchises into separate public companies late Monday, according to a company release, and the Rangers began trading Tuesday on the New York Stock Exchange under the ticker MSGR. The parent company, renamed MSG Knickerbockers, now trades as MSGK.

The mechanics were simple. Shareholders received one Rangers share for every two Knicks shares they held, in a distribution the company structured to be tax-free. The Knicks side keeps its G League affiliate in Westchester. The Rangers take the Hartford Wolf Pack and the team’s training center, amNewYork reported.

Then came the payday. On the day the deal closed, James Dolan, who now serves as executive chairman and CEO of both companies, received a one-time $10 million cash award “in recognition of his significant efforts and leadership,” Front Office Sports reported, citing an SEC filing. A three-person compensation committee with no Dolan family members signed off. The filing does not explain how the figure was set.

The case for the split has been on the table since February, when the board voted to explore it. Dolan said then that separating the teams would give each company “enhanced strategic flexibility,” and the company argued that investors would be able to value each franchise on its own terms. The market seemed to agree. MSG’s stock rose 16% on the day the split was announced in September, per amNewYork.

Flexibility is the word to watch. Two companies mean two cap tables, and that makes it easier to bring in minority investors for one team but not the other. It also makes a sale of either team simpler, though the prevailing view, amNewYork noted, is that Dolan has no plans to sell.

For now, early prices tell their own story. The Knicks were trading at about $302 a share Tuesday afternoon and the Rangers at about $190, according to Front Office Sports. Sports franchises have been selling at record valuations, and New York now has two of them priced every trading day.

Sources

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