For the third time since the Detroit Pistons were put up for sale, an exclusive negotiating period has expired without a deal being in place. Mike Ilitch's exclusive negotiating period came and went with no deal, and now Tom Gores has had two negotiation periods expire.
The first time Gores got into serious negotiations to purchase the team from Karen Davidson, he received a 30-day exclusivity window. It seemed like a deal was close considering he showed up to The Palace, but the exclusivity period came to an end and a new 14 day period began as negotiations continued.
Now those 14 days have passed and no extension has been granted for the most recent exclusive negotiating period. Talks are still continuing, but The Detroit News reports that the price of the team is a big point of contention right now.
By one measure the NBA uses to establish an ideal value for its franchises, the price tag for the Pistons should be about $420 million, according to sources who have participated in sales in both the league and other professional sports.
But why would a demonstrably astute businessman like the private equity financier Tom Gores ever pay $420 million for the team, The Palace of Auburn Hills and ancillary entertainment properties when the Ilitch family offered only about $360 million?
The answer is: He will not.
It has seemed for a while now that a deal was imminent, but if neither side will budge on the price then talks could come to a standstill. A compromise will have to be reached, although I can't see Gores overpaying for a team that probably is nowhere near worth more than $400 million.