The owners of the Sacramento Kings basketball franchise have struck a tentative deal to sell the sought-after California team to local investors after the National Basketball Association denied a proposal to move the team to Seattle, a spokesman for Sacramento Mayor Kevin Johnson said on Friday.
The deal by an investor group led by tech titan Vivek Ranadive follows months of bitter wrangling between Seattle investors who wanted the team to replace a beloved Pacific Northwest franchise lost in 2008 and California investors who wanted it to stay put.
Johnson's spokesman declined to give details on the tentative deal to keep the Kings in the California capital. But a source close to the negotiations said it values the franchise at roughly $535 million and the group has placed more than $341 million in escrow.
For Ranadive to buy a 65 percent stake in the Kings, he must divest his minority ownership stake in the Golden State Warriors, which could happen as early as Friday.
"The wheels are in motion," said the source, who spoke on condition of anonymity to discuss the deal's final steps. The deal will require NBA approval.
The investor group behind the deal also includes former Facebook Inc executive Chris Kelly and 24-Hour Fitness founder Mark Mastrov, among others.
The deal is a blow to an earlier agreement struck in January between the Maloof family that owns the Kings and the Seattle-based investor group, led by hedge fund manager Chris Hansen and Microsoft Chief Executive Steve Ballmer and others.
Hansen has long vowed to bring a team back to Seattle renamed the SuperSonics after the city's sorely missed franchise it lost to Oklahoma City. He already has a deal with the city to build a new arena.
Last month, a committee of NBA owners voted that the team should stay in Sacramento, but Hansen vowed to fight on, raising his bid for a controlling interest in the Kings to $406 million, which valued the team at an unprecedented $625 million.
(Editing by Scott Malone, Cynthia Johnston and Tim Dobbyn)