Platinum Equity Chair & CEO Tom Gores has "received an additional 14 days to try to strike an agreement" for the Pistons with team Owner Karen Davidson, according to Krupa & Goodwill of the DETROIT NEWS. Sources said that the two sides "continue to discuss a series of difficult issues, including the price of the team, the structure of the ownership and the impact of labor strife in the NBA on a purchase of the Pistons and Palace Sports & Entertainment." Despite a "flurry of media reports beginning late Thursday, the sources said no agreement of any sort is in place between the parties, but did confirm that talks persist." Michael Layne, a spokesperson for Davidson, said, "The parties are continuing to work in a cooperative manner and have agreed to a new, 14-day exclusivity period." Similarly, Platinum Equity Principal Mark Barnhill said, "Reports that a deal is already in place are incorrect. ... We are making progress, and both sides are working hard in hopes of reaching an agreement." Sources close to the negotiations "are optimistic" because the talks have "suddenly yielded considerable results, beginning last week." But the sources "urged caution, saying significant issues are unresolved and the process remains susceptible to unraveling." They also denied that "any agreement, tentative or otherwise, has been presented to the NBA or that commissioner David Stern had signed off on part of any deal" (DETROIT NEWS, 2/12). In Detroit, Bill Shea noted Gores returned home to California on Friday "after several days of negotiations at the offices of Davidson’s attorneys" in Michigan. An NBA source indicated that the "next in-person meeting of the NBA’s 29 other owners isn’t until April, but owners could approve the sale of the Pistons via an e-mail or conference call vote before then" (CRAINSDETROIT.com, 2/11).
WHAT HAPPENS NEXT? In Detroit, Tom Walsh cited sources as saying that over the next few days, reps for both Gores and Davidson "will be taking the agreement in principle (about two pages) and turning it into a detailed contract (about 50 pages) that specifies collateral, payment schedules, allocation of cash flows and other fancy financial terms." NBA officials are "said to be aware of the shape of the deal and supportive." Gores has been "presumably pushing to shelter himself from potential damage in case of an NBA labor stoppage next season." But the league is "said to be adamant that the language of purchase deals should not create disparities in the way different owners are affected by a players' lockout or strike" (DETROIT FREE PRESS, 2/12). Also in Detroit, Vince Ellis noted the "total value of the deal," which includes the Pistons, The Palace of Auburn Hills and DTE Energy Music Theatre, is expected to be announced at about $420M. But that "doesn’t mean Gores will pay that much immediately." Current ownership is "expected to retain a minority stake of perhaps 10% for up to several years" (DETROIT FREE PRESS, 2/12). It is "not clear if Gores would keep the team in Auburn Hills" or move it to downtown Detroit (N.Y. TIMES, 2/12).
CHANGE WILL DO YOU GOOD: In Detroit, Terry Foster wrote the Pistons have had "no leadership and direction since owner Bill Davidson died nearly two years ago." His widow, Karen Davidson, "wanted out as quickly as she stepped up to the plate." The "quicker the Pistons can move on from this state of suspension, the quicker they can move toward being a competitive team again." Former Pistons star Isiah Thomas said, "Any CEO or manager will tell you that when a company is in a state of transition or being sold that there is not many moves you can make with certainty to solidify your future" (DETROIT NEWS, 2/13). Also in Detroit, Mitch Albom wrote under the header, "As Pistons Owner, Tom Gores Would Break Detroit Mold." There is "usually some hubris to buying a franchise," and if that is "what motivates Gores -- who dabbles in financing movies and has a lot of handsomely posed photos found on the Internet -- it will be something new for Detroit fans." Detroit fans have "not seen the likes of a 46-year-old billionaire who spent most of his childhood in the Flint area but calls Beverly Hills home." Gores is "notoriously private, perhaps less due to the inbred shyness of guys like Ilitch and Davidson and more because talking doesn't help his bottom line" (DETROIT FREE PRESS, 2/13).
WHO IS TOM GORES? In Detroit, John Gallagher profiled Gores, America's 153rd richest person with an estimated personal wealth of $2.4B, who "moves easily between the cloistered world of investment banking and the flashier venues of entertainment." He is said to be "concerned for his privacy if he takes command of the Pistons, and declined interview requests for this article." Gallagher: "Tom Gores may be all business, but his pleasure in the world of media and entertainment shows he may be able to handle the intense scrutiny that comes with owning a National Basketball Association franchise" (DETROIT FREE PRESS, 2/13).
