Detroit Pistons sale could close next week
Let me try and work this out for everyone. The Detroit Pistons and the arena they built the Palace of Auburn Hills are worth around 480 million dollar or so according to Forbes. Now since Mike Illitch (owner of the Detroit Tigers and Red Wings) did not want the Palace as an arena, to him the team was not nearly worth that much. There have also been reports that the Pistons over estimated their books, and former Piston President, Tom Wilson, was sitting on the side of Mr. Illitch. That made a deal there nearly impossible.
In steps Tom Gores, a Michigan Native and MSU alumni, with a personal net worth of around 2.2 billion, to buy the team. To Gores the team is worth a lot more because he has no plans to use the franchise to leverage the city of Detroit into building a new arena for his sports teams. It seems very likely that Gores is a basketball fan, and would like to own his hometown team and keep them in his hometown.
Gores has a reputation of taking non profitable assets and turning them in to winners, and he does not overpay for the things he decides to buy. I would be willing to be the final sale price ends up being more like 400 million. I also happen to think Gores will be a far better owner that Illitch could have been.
Let me explain that. Illitch is not passionate about basketball; this was a business move for him. It would be far easier to leverage a new downtown multi use stadium for the Red Wings and the Pistons if he owned both of them. The Pistons need a passionate owner, much like Bill Davidson once was, to return them to greatness. Mr. Illitch simply is not that.