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Gores, Platinum Equity To Buy Detroit Pistons–UPDATED

After several months, Tom Gores, and his PE firm, have inked a deal to acquire the Detroit Pistons.

Gores and Platinum Equity have agreed to buy the Pistons as well as the Palace of Auburn Hills, DTE Energy Music Theatre and the operating rights to the Meadow Brook Music festival, according to a statement Friday.

Terms of the deal, which is expected to close by June 30, weren’t announced. The transaction must still be approved by the NBA’s Board of Governors. (UPDATE: The sale of the Detroit Pistons is rumored to be pegged at roughly $420 million. However, the deal is actually substantially below that, or about three-quarters of that price tag, a source says.)

Comerica Bank is providing financing.

“I am very proud to have this opportunity to be part of such a tremendous organization,” Gores said in a statement. “I know it’s been a long process and I appreciate the patience and support of the Detroit community.”

The Pistons have been up for sale since last summer and were not expected to fetch more than $400 million. In December, Gores became the lead bidder when Ilitch Holdings lowered its original bid to $360 million, according to the Detroit News.The Pistons have no debt and are believed to have the fifth largest revenue stream in the NBA, the Detroit News said.

In February, Gores extended discussions with Pistons owner Karen Davidson to buy the team after the window for formal negotiations expired.

“Just as my late husband, Bill Davidson, was the face of the Pistons, I am confident that Tom will bring the same energy, dedication and love to this organization,” Davidson said in a statement. “I look forward to seeing Tom follow in Bill’s footsteps, and carry on his legacy.”

Gores is also from Michigan. “I grew up here, I am glad to be back, and I am very excited about all the possibilities looking forward,” he said.

In 1995, Gores founded Platinum Equity. The Los Angeles buyout shop has two funds (the last raised $2.75 billion in 2008) and $3.45 billion in capital commitments. Platinum Equity focuses on industrial, manufacturing, logistics & distribution, IT services & software, telecom and media.

Citi Private Bank’s Sports Advisory group served as financial advisor to the Pistons.

Platinum Equity declined comment beyond the press release.