NEW YORK (CNN/Money) - AOL Time Warner Inc. has signed an agreement with Dallas car dealer David McDavid to be the lead bidder to buy its basketball and hockey teams.

In an e-mail sent to employees of the Turner Broadcasting unit of the media conglomerate late Tuesday, Terry McGuirk, CEO of sports, said that the company had entered into an agreement with McDavid for an exclusive negotiating period for the Atlanta Hawks basketball team and the Atlanta Thrashers hockey team, as well as its operating lease for the Philips Arena, where the two teams play.

"What this means is that we are now only negotiating with Mr. McDavid for a specific timeframe regarding these three assets," said the e-mail. "There remains work to be done before we can conclude a sale.

"Discussions with multiple parties interested in the possible acquisition of other company assets will continue," he added.

McDavid is a former minority owner in the Dallas Mavericks who made his money in the car dealership business in that area. He told the Atlanta Journal-Constitution that he is confident he'll be able to close on the deal, and that he intends to keep the teams in Atlanta.

"I am thrilled about the prospect of owning such an esteemed collection of sports and entertainment properties as the Hawks, Thrashers and operating rights to Philips Arena," said McDavid. "This is one big step in a long process, and there still remains a lot of work to do before the deal is completed. However, I am confident that the acquisition will come to fruition."

As much as a third of the National Hockey League is reported to be for sale, with one team operating under bankruptcy court protection and the league facing a possible strike or lockout at the end of next season when the current labor pact expires. Forbes put the value of the Hawks at $206 million and the Thrashers at $134 million, but a leading sports investment banker said those estimates are well above the current market values. Prices of sports teams are being hurt by the large number of franchises now available for sale. Still, AOL Time Warner is expected to get more than $200 million for these three properties.

The Hawks are expected to be worth more than $140 million, said the sports investment banker while the Philips lease is worth between $25 million and $30 million. The Buffalo Sabres hockey team was recently sold for about $45 million out of bankruptcy court, plus assumed debt.

AOL Time Warner (AOL: Research, Estimates), which owns CNN/Money, is seeking to sell what it considers non-core assets as a way of shaving $26.3 billion in debt. Last month it announced it would sell its 50 percent stake in cable network Comedy Central for $1.2 billion.

Company spokeswoman Tricia Primrose confirmed Wednesday that earlier this week AOL Time Warner Chief Financial Officer Wayne Pace said that the negotiations to sell those two sports teams were heating up and a deal could be concluded soon, but he said that there were at least four bidders, including McDavid and former New York sports executive Dave Checketts. He did not identify the other bidders.

Primrose also confirms that Pace said that the efforts to sell the company's other sports team, the Atlanta Braves baseball team, were at a standstill, and that a bid led by outgoing AOL Time Warner Vice Chairman Ted Turner, former Braves owner Bill Bartholomay McGuirk and Stan Kasten, the president of the three teams, was not a serious player at this point. Kasten said Wednesday that he had no comment on any of the team sales.

McDavid previously explored a possible purchase of the Dallas Stars hockey team, according to a source familiar with those negotiations. The Stars are owned by Tom Hicks, CEO of private equity firm Hicks, Muse, Tate & Furst as well as owner of the Texas Rangers baseball team.

Shares of AOL Time Warner were unchanged at $13.68 in Wednesday trading.