Another Texas billionaire has added yet another sports franchise to their collection of assets.

On Friday, Tom Dundon—the owner of the NHL's Carolina Hurricanes, a Dallas-area native and a graduate from Southern Methodist University—reached an agreement to purchase the Portland Trail Blazers from the estate of late Microsoft co-founder Paul Allen.

Dundon, who is also the chairman and managing partner of Dallas private equity firm Dundon Capital Partners and chairman of pickleball.com, came to an initial deal back in August for a valuation of $4 billion. Last week, Allen's estate confirmed that the two sides had "entered a formal sales agreement."

Dundon began his entrepreneurial career investing in restaurants before co-founding a subprime auto lending company called Drive Financial Services, LP, where he achieved financial success. Dundon later sold that company to Santander Consumer USA, a bank owned by Spain-based Santander. Still, through his private equity firm, they are invested in Exeter Finance, one of the nation's largest subprime auto lenders. Exeter, which has a history of questionable lending practices, has been accused of not properly disclosing loan terms, causing consumers to be unable to pay the bills due to backloaded interest charges.

As Tom Ziller first called out in his newsletter, a ProPublica investigation details how vital that process is in how Exeter does business.

The company, which has more than 500,000 active loans and a partnership agreement with CarMax, the country’s largest used car retailer, casts itself as a provider of second chances. “We’re here to help,” it says on its website. In reality, Exeter’s practices often do the opposite. When the company allows a borrower to skip payments, it typically adds thousands of dollars in new interest charges to the customer’s debt. Dozens of customers told ProPublica that Exeter didn’t tell them about the added costs. When it’s time to make their final payment, many are faced with a huge bill, which they often can’t afford to pay.

Chron reached out to Dundon Capital Partners and the Carolina Hurricanes but had not received a response by publication.

Also of note is that the Consumer Financial Protection Bureau took action against Santander in 2018 for the same practices as Exeter and forced the Spanish bank to pay nearly $12 million in restitution and penalties. Dundon left Santander in 2015, and Exeter has yet to be hit with similar penalties.

Dundon’s ownership group includes founders of an asset management firm and a venture capital firm but more notable is the inclusion of the Cherng Family Trust, the investment group of Panda Express co-founders Andrew and Peggy Cherng.

Dundon's investment in sports also includes a failed $250 million venture with the American Alliance of Football (AAF), a professional football league startup intended to compete with the NFL by offering games for fans in the spring. The AAF ultimately went bankrupt and sued Dundon for $184 million, claiming Dundon sabotaged the startup efforts. Dundon responded by suing the league’s founder, Charlie Ebersol, for the $70 million he initially invested. Dundon alleges that Ebersol was not transparent about the league’s financial condition. According to Oregon Live, during testimony last month, Dundon admitted telling the press he had committed $250 million, but later called those statements “marketing” rather than contractual. The trustee’s report described his testimony as “consistently inconsistent” and not credible.

As of Tuesday, the NBA Board of Governors has not yet approved the final sale of the Trail Blazers, but the deal is expected to close by year's end. The Los Angeles Lakers, sold to Los Angeles Dodgers owner Mark Walter for $10 billion, are also awaiting league approval from the Board of Governors. (CHRON)

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