Coyotes court auction ends without a ruling

Canadian billionaire Jim Balsillie

Found at CTV website:

The court auction for the bankrupt Phoenix Coyotes NHL team has concluded its final day with little indication of how the judge overseeing it may rule.

Canadian billionaire Jim Balsillie has been trying to buy the Coyotes for the past four months. An auction for the team, which is being overseen by Judge Redfield T. Baum, wrapped up on Friday after two days of hearings.

At the conclusion of Friday’s hearing Baum said he would hand down his decision at a later date, but didn’t say when that might be.

Balsillie has an offer on the table, as does the NHL, and both adjusted their offers as the clock ticked down during the hearing.

The co-CEO of Research in Motion Ltd., the Ontario firm that makes the ubiquitous BlackBerry smartphone, has offered to buy the Coyotes for US$242.5 million, so long as the team can be moved to Hamilton, Ont.

The league has offered $140 million for temporary ownership, with plans to sell the team outside of bankruptcy.

Balisille improved his offer in the final moments with a guarantee that Glendale, the city where the team now plays, would get $50 million. He also removed the Sept. 21 deadline for a deal, from his offer.

The NHL agreed that Coyotes owner Jerry Moyes and managing partner Wayne Gretzky, should take a $14 million payout. In its original deal, the NHL offered nothing to Moyes.

However, Baum has said it’s possible he will reject both offers, resulting in no sale, and that any successful buyer will have to satisfy several legal criteria.

The NHL claims Balsillie is ineligible to bid on the team since the league’s board of governors rejected his application for ownership by a margin of 26-0.

The main opponent to Balsillie’s ownership bid is NHL Commissioner Gary Bettman. He took the stand Friday for about 40 minutes, defending his argument that the league is best positioned to take over ownership of the team.

While on the stand, Bettman dismissed the claim he put the NHL in a conflict of interest by secretly plotting to buy the team before the league rejected his offer. Bettman said the NHL didn’t decide to put an offer together until about 24 hours before they submitted it.

Balsillie had also been expected to take the stand Friday, but the league’s lawyers waived their right to cross-examination.

Tony Clark, the lawyer representing the NHL, said if Baum rejects both bids the league will seek a ruling allowing it to take control of the team to prepare for a resale.

A third offer for the team — worth $148 million and led by Jerry Reinsdorf, owner of the Chicago White Sox and Bulls — was scrapped in late August.

Balsillie’s legal team has urged the judge to overturn the NHL governors’ decision to reject him as an owner. They’ve also asked that the ruling allow the team to be relocated without the league’s permission.

Jeffrey Kessler, one of Balsillie lawyers, has argued the team would be more successful in Hamilton, and the judge should make his decision accordingly.

NHL lawyer Tony Clark has asked whether Balsillie has the right to be an owner, underscoring that Balisllie’s lawyers had referred to a “secret conspiracy” by the Toronto Maple Leafs to keep a team out of Hamilton.

Balsillie offers $212.5M to bring Phoenix Coyotes to Southern Ontario

Hamilton Tiger-Cats Logo NHL Hockey Team Franchise

Jim Balsillie (my Canadian Hero) confirmed that he has offered to pay $212.5 million US to purchase the Phoenix Coyotes on the condition that the bankrupt team relocate to southern Ontario.

Jim Balsillie of RIM, owner of the Hamilton Tiger-Cats NHL Hockey TeamBalsillie, 48, made the offer to Coyotes majority owner Jerry Moyes, consenting to buy it if he can move it, presumably to Hamilton or the Kitchener-Waterloo region, where he runs Research In Motion Ltd., maker of the popular BlackBerry mobile device (which everyone owns and love).

Balsillie also agreed to provide $17 million US in bridge financing to keep the Coyotes operating in advance of the proposed sale.

“The current team ownership asked that I table an offer to purchase the Coyotes, and significant discussions resulted in an offer that is in the best interests of the franchise, the NHL and the great hockey fans of Canada and southern Ontario,” Balsillie said in a statement (What a Guy!).

“I am excited to move closer to bringing an NHL franchise to what I believe is one of the best unserved hockey markets in the world — southern Ontario — a market with devoted hockey fans, a rich hockey history, a growing and diversified economy and a population of more than seven million people.”

Team ownership formally filed for Chapter 11 bankruptcy protection, at which time the Balsillie bid came to light.  “Obviously, the focus is the courts have to make a decision on the offer that I have made,” Balsillie told reporters in Toronto.  “It is a firm offer, it is a supported offer and the place I want to move the team to is in an unserved market in southern Ontario … but clearly, we believe there is a great opportunity there.”

“It is the owner’s decision whether to file for bankruptcy and we provided our support, or our offer, our financing into it, so really this is in response to events that happened,” Balsillie explained. “We’re responding to events and this is a very serious and committed offer by me — it is funded and financed and fully backed.”

BettmanMismanagementNHL commissioner Gary Bettman (Lord of Evil – Hater of Canadians), who twice previously rejected Canadian billionaire Jim Balsillie’s attempts to purchase a team and relocate it to southern Ontario, remains firm in his stance.   Joining a panel of commissioners from Major League Baseball, the National Football League and the National Basketball Association on Wednesday, Bettman briefly addressed Balsillie’s latest offer to buy the financially strapped Phoenix Coyotes for $212.5 million US.

“Yes I do,” Bettman said when he was asked by a media reporter after the panel session if he envisioned the Coyotes beginning the 2009-10 season in Phoenix.  “We fix the problems. We don’t run out on cities,” Bettman told the other commissioners, in reference to past economic troubles facing NHL teams in Pittsburgh, Buffalo and Ottawa.  “This is not about whether we want a franchise in southern Ontario. This is not about whether Mr. Balsillie would make a suitable owner and one the league would approve.”  Bettman added the NHL’s 30 team owners, not the league commissioner, vote on whether someone would be approved as an owner.

The NHL reacted swiftly, responding to the petition of sale and relieving Moyes of his duties with the Coyotes. “We’re just getting the [sale] papers and reviewing them and we’ll probably be in court dealing with this whole issue,” Bettman told the media.

Asked how this could happen, Bettman said: “Somebody, and you’ll have to ask the people who were involved in doing it, devised a strategy which somehow they think might entitle them to do something they might not otherwise be entitled to do.”

A spokesman for the city of Glendale, Ariz., where the team’s arena is located, told reporters last week that the NHL had assumed control of the Coyotes and that team ownership paid $351,000 in overdue rent on Feb. 25 — reportedly after receiving an unspecified loan from the league.

My two Cents:

Why did some of the Canadian teams moved South?  The Winnipeg Jets were not lost due to any lack of interest from the fans whatsoever. They rallied in the thousands and raised money to try to save their team. The owner, Barry Shenkarow, was one of the very last owners left fighting for a salary cap during the 1994-95 lockout. When the new CBA was finally reached, the owners failed to get a salary cap  and got taken by the NHLPA.

This is the reason the Jets, the Nordiques, and the Brass Bonanza Boys were all driven out of their respective markets. The Canadian teams were also suffering from the double whammy of a floundering Canadian dollar.

The bottom line is, the NHL owners and its players were the two parties most responsible for these lost franchises. They held the cards!

However, times have changed and all the existing Canadian teams are now on the top of the league revenue pole.   As a good CEO or Commisioner, Bettman must realize this and actively look at bringing a hockey franchise back into Canada.  If it doesn’t work in Arizona, Florida, or Nashville then the team needs to be moved.   A team in Southern Ontario is a no-brainer!  The Hamilton Tiger-Cats NHL Hockey Team has a nice ring to it.  Go Cats Go!