Private equity billionaire Tom Gores has agreed to pay $750 million to buy 27% of the National Football League’s Los Angeles Chargers at an enterprise value of $4 billion, according to two people with knowledge of the deal who spoke on the condition of anonymity to discuss nonpublic details.

The $4 billion valuation is more than a 30% discount to the team’s value of $5.83 billion, according to CNBC’s Official 2024 NFL Team Valuations. Limited partners with no path to control of the team typically get about a 20% to 25% discount in these deals.

Gores likely got a larger than usual discount because he bought such a large chunk of the Chargers — 27%, just 3% shy of the required stake for a controlling owner, though he will be a limited partner with no say in how the team is run.

The deal is also subject to a “flip tax” of 10% the sale amount, with the obligation to pay falling on the seller, which will be equally divided among the other 31 teams in the league. The flip tax was an agreement the Chargers made with the league in 2015 as part of the pact to move the team to Los Angeles and is similar to the deal the Las Vegas Raiders made with the NFL before moving from Oakland, California.

Gores is buying the entire 24% stake previously held by Dea Spanos Berberian as well as 1% each from Dean, Alexis and Michael Spanos, according to one of the people familiar with the deal.

When the sale in completed, Dean, Alexis and Michael Spanos will own 69% of the team combined, the person said, while Gores and his wife, Holly, will hold 27% and two long-time limited partners will retain a combined 4%.

Dean Spanos remains the controlling owner and chairman of the board of the Chargers. His father, the late Alex G. Spanos, bought the team in 1984 for $72 million.

This transaction will also resolve, in their entirety, all of Berberian’s legal disputes with her three siblings and with the Chargers. These disputes date back to 2021, when Berberian brought a lawsuit seeking to force a sale of the franchise. The legal action, and related actions filed by Berberian and her family, all ultimately failed to proceed.

Gores also owns the the National Basketball Association’s Detroit Pistons. The private equity founder along with this firm, Platinum Equity, bought the team for $325 million in 2011. Gores bought Platinum’s stake in 2015 giving him 100% of the team’s equity.

The purchase of the Chargers stake is solely by Gores and not affiliated with Platinum Equity. The NFL declined to comment on the deal.

Although stadium economics are an important factor in determining team valuations, when it comes to sports Gores seems to prefer being a renter rather than an operator.

The Pistons play in Little Caesars Arena, which is home to the National Hockey League’s Detroit Red Wings. The Ilitch family, which own the Red Wings, operates the arena, meaning they get the money from non-NHL and non-NBA events.

Likewise, the Chargers play in SoFi Stadium, which is also the home of the Los Angeles Rams. Stan Kroenke, who owns the Rams, also owns the stadium, which is the main reason why the Rams are worth $8 billion compared with $5.83 billion for the Chargers, according to CNBC’s 2024 rankings.

But renting has its advantages: You don’t have to pay the financing or operating expenses of the stadium, nor do you have the responsibility of booking events.

Correction: Tom Gores’ deal for a stake in the Los Angeles Chargers is subject to a “flip tax” of 10% the sale amount, with the obligation to pay falling on the seller. A previous version mischaracterized the tax.