By Jeff Moss
DetroitSportsRag@GMail.com
August 26, 2013
Usually when I post a rumor or a breaking news story on the DSR, there is some follow-up report from another news source either shooting down the speculation or giving credence to my report.
When I broke the news in July that 105.1-FM was flipping to a sports format with a combination of local and ESPN talent, Gregg Henson followed up with his own reporting within hours; then, of course, Bill Shea stole the report from the two of us and posted it on Crain’s Detroit.
When I speculated about Prince Fielder’s marriage – how Chanel Fielder hadn’t been around Comerica Park all season long, and a charity event that the pair had scheduled was canceled – another blogger found the divorce filing in Florida (With a an OBVIOUS hat tip to Torii Hunter for mentioning Prince’s off-the-field issues in the first place).
But since I reported last Thursday evening that Pistons owner Tom Gores was in negotiations with Mike Ilitch and two other groups to purchase the Detroit Pistons, there have been zero media reports discussing this issue.
Now, that’s not entirely surprising. The Pistons beat writers are an abomination to journalism and couldn’t break a story if it smacked them upside the head. The next time Vince Ellis or Vincent GoodSHILL beat Adrian Wojnarowski or Marc Stein to a Pistons related story it will be the first.
In fact, the only response came from the Pistons ownership group themselves in a scathing email just moments after my story was posted on the DSR. The following is the initial email I received from Mark Barnhill of Platinum Equity:
I’m Mark Barnhill, one of Tom Gores’ partners at Platinum Equity. I just had someone point me to your blog item on alleged negotiations with Mike Illitch to sell the Pistons. It’s utterly false. Fabricated. Made up out of whole cloth. Please retract, or put your putative source on the record so I can call him a liar to his face.
Now, while the DSR’s readership is growing on a daily basis, we aren’t exactly the Freep, the News or even ClickonDetroit.com. How the hell did one of Gores’ associates find out about my article so quickly? That is freaking insane.
When I responded to Mr. Barnhill that I had checked with my source and they remained adamant that negotiations had commenced, I received this message from the exec:
It’s more than my “position,” or a “protest” — it’s a fact. Put your source on the record and let’s smoke out the truth together! Somebody with an agenda is feeding you false information….
If anything, the vehement denial from the Palace only assured me that I was on the right path. I mean, why the hell would PE give two shits what some blogger on the Intranets with a loyal, but limited following had to say?
This is the same organization that absolutely REFUSED to respond to me a couple of years back when I was just looking for a simple answer from them about the potential booking of a halftime show.
In 2011, I started a campaign to get Benjy Bronk and his girlfriend Elisa Jordana to Auburn Hills so they could perform their song “Online Sweetheart” at intermission of a Pistons game. At the time, the team was promoting all of these nostalgia acts (Bel Biv Devoe, Salt-N-Pepa, etc.) for any sort of attention at all because the Palace was 75% empty on some nights.
Bronk is a writer for the Howard Stern Show, and the booking of the duo would have guaranteed plenty of airtime as the King of All Media surely would have discussed the topic with his millions of listeners on his national radio show.
Hell, I even appeared on Stern’s two SirusXM stations promoting the idea in a news report.
But when I sent over a dozen emails to pretty much everyone in a position of power at the Palace, I didn’t get ONE response. Not even a polite note stating that this gimmick wasn’t something they would be interested in.
But I post a story about the team potentially getting sold and within MINUTES I receive a missive from a PARTNER at Platinum Equity. Not some assistant VP who got his title because he is someone’s brother-in-law. No, I get a note from one of the PRINCIPALS.
And you don’t think I am on to something that these people don’t want out there yet?
So why would Gores want to sell the Pistons at this point? He spent the last couple of years enduring a dogshit product with his team playing in front of an empty arena. Why the hell would Gores want to get out now?
Because Tom Gores is in the business of making money. That is what he does at Platinum Equity. He purchases companies that are in distress for a low price and then maximizes profit by unloading that entity at the perfect time.
Let’s go back to Bill Shea once again. Now, unlike him, I give credit where credit is due, so I will provide a link to this story Crain’s ran when Gores purchased the team in 2011. Here are the first two paragraphs:
Tom Gores made his billions by identifying companies he could buy cheaply, fix and spin off for a tidy profit.
Insiders say he used his acumen at spotting a good deal to get the Detroit Pistons and Palace Sports & Entertainment Inc. for a price far below what they expected: $325 million.
Yep, Gores basically stole the team and Palace Sports & Entertainment from Karen Davidson, who was desperate to unload the franchise after her husband (Bill) passed away.
Keep in mind, since Gores bought the team from the woman who nearly wrecked the franchise in direct opposition to her late-husband’s wishes, the NBA reached a very favorable Collective Bargaining Agreement with the NBA Players Association.
Here is a quote from Bill Simmons’ mailbag article from Grantland.com on Friday in which he discussed the current state of NBA ownership:
2. Our last collective bargaining agreement was apparently negotiated by Billy Hunter while he was dressed like General Custer. Did Billy have any idea that Fox Sports 1 and NBC Sports Network were coming, or that live content in the DVR/Twitter/Netflix era was the single most important TV property you could have? It’s unclear. But the league’s franchise values have been climbing from the moment that lockout ended. Three years ago, Joe Lacob’s group paid $350 million less for the Warriors than they’re worth today. Josh Harris’s group paid a little less than half as much for the Sixers as Vivek Ranadive paid for the Kings just 30 months later. Hansen missed his window to steal an NBA franchise for anything resembling a good price.
3. You’d be crazy to sell an NBA team right now. Even if you own a team in a less-than-thriving market — say, Detroit or Charlotte — you could thrive by throwing out a $45 million player payroll, collecting TV/merchandising/luxury tax revenue and letting your franchise appreciate. That’s how we knew the Maloofs were broker than broke: NOBODY wants to sell an NBA team right now, and yet they had to sell their team.
Tom Gores has done it again. The man is obviously a brilliant businessman. EVERYONE wants to own an NBA team now because it is basically means you own a license to print money no matter what you do. Win, lose, sell out the building, have 2,000 people show up, IT DOES NOT MATTER. You still rake in the cash.
Just remember the Pistons and the Palace and DTE Energy, etc. sold for $325 million in 2011 and then read this quote from Simmons’ article:
Your only possible relocation prey? The perennially mediocre Milwaukee Bucks, who rank behind the Packers, the Brewers, Wisconsin basketball, Marquette basketball, Wisconsin football, and the Packers a second time on the Wisconsin Sports Fan Priority Scale.3 Still, they’re owned by retired politician Herb Kohl — or as every NBA employee respectfully calls him, “The Senator” — a 78-year-old guy who doesn’t seem especially motivated to become The Guy Who Killed Professional Basketball in Milwaukee. Even if you offer a record price for the Bucks (something like $850 million, not including the relocation fee), nobody thinks Kohl would bite. He’s the same guy who values being a perennial no. 8 seed over blowing things up and going into über-tank mode (like the Sixers just did). Now he’s just going to quit on professional basketball in Milwaukee completely? At his age???
$850 million for the MILWAUKEE BUCKS when Gores purchased the Pistons and Palace Sports & Entertainment for a half a billion dollars less?!?!!?!?!?!?!?!
[Editor's Note: I am not attempting to say that the Pistons or Bucks are worth that kind of money, but it isn't a reach to think that the Pistons are already worth HUNDREDS of millions of dollars more than Gores paid for them just two years ago. As Twitter follower @WeRollHard pointed out, Chris Hansen DID offer $625 million for the Sacramento Kings.]
Is this sinking in yet? Gores is sitting on a winning lottery ticket!!!!! And do you think he cares enough about the PISTONS to not strike while the iron is hot and show the world how smart he really is? Hell, the Pistons aren’t even his favorite NBA team…and he OWNS them.
How many times did the man even show up at the Palace during the lockout shortened 2012-3 season? Two or three times? Yep, he is a real diehard. I am pretty sure he was a regular caller to Matt Dery’s postgame shows. He was just using an alias like “Frank” or something.
The first part of this equation is everything I just laid out for you. The second is willing buyers, and there doesn’t seem to be a shortage of those either.
We all know that Mike Ilitch and Olympia Entertainment have gone down this road before, as Mr. I almost purchased the team from Davidson back in 2011. Remember this headline?
Now, why would Ilitch want to pay through the nose (no pun intended) for the Pistons today when he could have had them for a much lower price back in 2011?
Well, the new Red Wings arena near the Fox Theater is now basically a reality instead of a rumor, and the Pistons and Wings sharing the new building would be a coup for the Ilitch Family.
But I believe there is way more to it than that. If Ilitch could purchase the Pistons he would be in a position to cut Fox Sports out as a middle man in team broadcasts and he could start his own TV station not unlike the YES Network in New York.
This is where I believe Olympia Entertainment could make some serious dough – by cornering the market on all of the professional Detroit sports teams that have local television deals.
And with the advent of DVRs and TIVOs and every other recording device known to mankind, there is now a premium on live sports broadcasts. Most fans have to watch their favorite teams live. It isn’t even like the old days when you could tape a Wings or Tigers game and avoid the final score until you got home.
Since most people live on Twitter or Facebook, there is very little chance that you can totally stay away from scoring updates unless you REALLY, REALLY go out of your way to do so.
So most fans watch the game live and have to sit through all of the commercials. Advertisers know this, which means rates for local sports programming are going through the roof.
Why should Ilitch share all that Sam, Richard, Mark and Beth Bernstein cash with Rupert Murdoch if he doesn’t have to?
But, according to my source, Ilitch isn’t the only one with an interest in purchasing the team and moving it Downtown. There are supposedly two other groups with a similar intent.
And this is part of the article where I provide you with the crazy, unsubstantiated rumor that won’t go away. Everyone in town is fully aware that Dan Gilbert is buying up property in Detroit at an unprecedented rate –from his attempt to buy the unfinished Wayne County Jail and convert it into an entertainment district to his Woodward office building purchases to his interest in Greektown Casino.
If you think the owner of the Cleveland Cavaliers isn’t also interested in owning a sports team or two in his HOMETOWN, well …. Robert Ficano and I want to discuss some building plans with you.
I have even wild heard speculation that Gilbert wants to sell the Cavs and purchase the Pistons. Now, I have no clue if that is even feasible or not, but is it possible that Gilbert is involved somehow in all of this Pistons mess?
Could Gilbert be one of Ilitch’s partners or a member of one of the other groups?
For that matter, do the Ilitch kids even want to own the Tigers once Mike, Sr. passes away? Could this all be part of a grand succession plan involving Dan Gilbert?
You want one more tidbit that makes this story even more intriguing? Back in April of this year, Gilbert was asked a question about the Pistons moving back to Downtown Detroit. Here was his answer in a Freep column by Tom Walsh:
Later in the breakfast panel, Gilbert was asked if he’s trying to persuade Tom Gores to move the Detroit Pistons downtown from the team’s current home in Auburn Hills.
“I always try to put the bug in his ear,” said Gilbert, who has long espoused the belief that sports arenas belong in core cities rather than faraway suburbs. Both the Pistons and Cavs had losing records this year, but Gilbert said the Cavs drew much better crowds because there’s more to do in downtown Cleveland — with a casino and restaurants nearby — than in a suburb like Auburn Hills.
And here was my new email buddy Mark Barnhill’s response to Gilbert’s suggestion that the Pistons should move out of the suburbs in that very SAME Walsh column:
“Listen, I’m not interested in getting into a political debate with Dan,” Barnhill said, adding that Pistons ownership is “quite happy” at the Palace of Auburn Hills.
Noting that the Palace joined a group of companies donating police cruisers and firefighting equipment to Detroit, Barnhill said, “I understand that Dan has a lot at stake downtown and it’s important to him.”
But he added, “Our constituents are not just downtown. They are in Auburn Hills and Sterling Heights and Troy and Wixom and Belleville and Ypsilanti and Cadillac and Flint and Fenton,” rattling off a list of towns where Platinum has non-sports investments in companies making products ranging from fasteners to boats.
Well, it doesn’t sound like Barnhill and Gilbert are fast friends. Did Barnhill email me because he was trying to flush out the leak and he was agitated because he thought it was coming from Gilbert’s people? Hmmmmm ….
This is all fascinating, and I am told by my source that we are just weeks away from something breaking on the Pistons ownership front.
And you thought the additions of Josh Smith and Brandon Jennings were newsworthy? It appears you haven’t seen anything yet.
Now, will someone please go wake up the Two Vinces?