Developer Forest City Ratner Cos. announced last week that a Russian firm would invest $200 million in the Nets basketball team and Atlantic Yards project in Brooklyn. The transaction could be completed in the first quarter of 2010.

Onexim Group, a private investment fund headed by billionaire Mikhail Prokhorov, plans to buy an 80% stake in the National Basketball Association’s Nets franchise, which is now owned by Forest City, according to a news release.

The Empire State Development Corp. plans to issue $700 million of tax-exempt bonds backed by payments in lieu of taxes to finance an arena on the 22-acre site. The arena is a key component to the project, which would primarily be devoted to high-rise apartment towers.

According to the Forest City press release, Prokhorov’s firm would create an entity that would take a 45% equity stake in the arena project as well as 20% of Atlantic Yards Development Co., which would develop housing and commercial space.

The arena would be owned by the ESDC and leased to ArenaCo, a Forest City subsidiary, so that PILOTs can pass from ArenaCo to the state agency or a subsidiary to pay debt service. ESDC spokeswoman Elizabeth Mitchell said that structure hasn’t changed.

“The Onexim Group’s 45% is equity for [Forest City] in terms of developing the project,” Mitchell said.

Prokhorov, who is often described as a Russian oligarch, has a net worth of $9.5 billion, according to Forbes.com.

The Internal Revenue Service no longer permits the kind of PILOT transactions the project is expected to use, but Atlantic Yards was grandfathered in, provided the bonds sell by the end of the year.

Andrew Silberfein, an executive vice president for finance at Forest City, said the bonds could be brought to market at the end of October and would likely have a 37-year maturity.

Goldman, Sachs & Co. and Barclays Capital will underwrite the bonds, Silberfein said. The project has been delayed by lawsuits, a change in architect for the arena, and difficulty finding financing.

The New York Court of Appeals will hear arguments on Oct. 14 in the case challenging the ESDC’s use of eminent domain to seize private property on behalf of the developer.

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