Wednesday, 10 February 2016
Last updated 6 hours ago
Apr 19 2011 | 11:27am ET
The ranks of alternative investment moguls-turned-sports team owners is set to get a little bigger at the end of June.
Billionaire Tom Gores, head of private equity firm Platinum Equity, has reached an agreement to buy the National Basketball Association's Detroit Pistons. It is unclear how much Gores, who grew up and went to college in Michigan before decamping for Los Angeles, will pay for the team, which was valued by Forbes magazine at about $360 million.
Platinum Equity will itself become a minority owner of the team, as well as its home arena, the Palace at Auburn Hills, and the nearby DTE Energy Music Theater.
Gores has been in talks with Pistons owner Karen Davidson, whose husband, Bill, bought the team in 1974 but died in 2009, since late last year. He beat out Little Ceaser's pizza owner Mike Illitch, who had hoped to add the Pistons to his Motor City sports empire, which already includes baseball's Detroit Tigers and hockey's Detroit Red Wings.
"I know it's been a long process and I appreciate the patience and support of the Detroit community," Gores said. "I grew up here, I am glad to be back, and I am very excited about the possibilities looking forward."
Gores' deal still requires the approval of the NBA. It is expected to close by June 30.
Gores is just the latest alternatives player to buy a sports team in recent months and years. Just last month, Junction Investors' Thomas DiBenedetto reach a deal to buy Italian soccer team AS Roma, with Raptor Capital Management founder James Pallotta among his minority partners. Pallotta is a minority owner of the NBA's Boston Celtics, and DiBenedetto himself is a minority partner of Fenway Sports Group, headed by hedge fund billionaire John Henry, which owns baseball's Boston Red Sox and English soccer team Liverpool Football Club, as well as a NASCAR racing team.
Last year, Vinik Asset Management's Jeffrey Vinik, another FSG minority partner, bought hockey's Tampa Bay Lightning, and earlier this year scooped up arena football team the Tampa Bay Storm.