Post by WpgJets2008 on May 21, 2009 15:05:18 GMT -5
Showdown in the desert
David Shoalts Monday, May. 04, 2009 04:23PM EDT
www.theglobeandmail.com/sports/hockey/showdown-in-the-desert/article1141760/
If Jim Balsillie's Coyote hunt comes to a quick end this afternoon at the hands of U.S. bankruptcy court judge Redfield T. Baum, it does not mean he will give up trying to put a second NHL team in Southern Ontario.
All it means is that the man who fuels the nightmares of NHL commissioner Gary Bettman will sit down with the architect of his pursuit, Toronto lawyer Richard Rodier, and pick another target. Then, when Balsillie and Rodier think the time is right, the roller-coaster ride will start all over again.
According to those familiar with their plans, there will not be an appeal if the judge rules against them on the key question of who controls the club, Phoenix Coyotes owner Jerry Moyes or the NHL.
If the judge rules that Moyes still owns the club and has the right to put it into bankruptcy and sell it to Balsillie, then the next step is the bankruptcy trial.
But if the judge sides with the NHL, which claims Moyes signed away control of the club last November when he stopped covering its enormous losses, then this particular fight is over for Balsillie before it even starts.
The judge could rule today or perhaps some time later after digesting the 100 or so documents filed by both sides.
Balsillie and Rodier believe their legal strategy can work.
The strategy is to buy an NHL team out of bankruptcy and then move it over the league's objections, by winning an anti-trust lawsuit if necessary. Losing the control ruling just means the Coyotes are no longer bankrupt, so they will not get a chance to try their strategy in court.
But the duo quite rightly believes there is a long list of likely candidates in a league that was already dealing with financially shaky teams in non-traditional markets and elsewhere even before the recession came along. Some of those owners are watching this ugly row closely because, if Balsillie prevails, there could be a run on the bankruptcy courts. In a few years, Canada may have more than enough NHL teams for everyone.
Thanks to the number of candidate teams for this, it is hard to say where Balsillie will cast his eye next if the judge sends him back to the starting line. The list of candidates, going in rough order from likely to least likely, includes the Atlanta Thrashers, Nashville Predators, Florida Panthers, Tampa Bay Lightning, New York Islanders, New Jersey Devils, Dallas Stars and St. Louis Blues.
The Thrashers are in the middle of their own bitter court battle. Minority owner Steve Belkin is fighting with the rest of the club's ownership group over the value of his 31-per-cent stake in the company that owns the Thrashers, the NBA's Atlanta Hawks and Philips Arena. Since the Thrashers were not tied to the arena by the bond issue the city made to finance it, they could be easier to move than the other teams.
But first the courts have to settle the fight over how much Belkin's share is worth before the other owners can buy him out. Only then can the Thrashers be sold. And this fight is so nasty there will not be any settlements on the steps of the courthouse.
The Predators bragged this season that they will turn a small profit. But that's only because they squeezed their payroll, bought their own tickets and raked in more than $20-million (all currency U.S.) from their NHL partners in revenue-sharing and escrow payments from the players, in addition to the regular shared NHL revenues like broadcasting.
There is also a bankruptcy court involved with this team. At stake is the share of the team owned by William (Boots) Del Biaggio III before he flamed out into bankruptcy and pleaded guilty to one count of fraud. It is the biggest single slice of the team and would put its winner at the top of the group of owners.
Before Moyes came calling last month, the Del Biaggio shares were Balsillie's preferred target, according to those who know him. They could be again.
***
ALSO SPUTTERING / WILL BALSILLIE KICK THE TIRES?
Aside from the Atlanta Thrashers and Nashville Predators, the other candidates for Jim Balsillie's next attempt to land an NHL team, should he be forced to try again, all have financial problems of varying degrees. Here is a quick look at them:
FLORIDA PANTHERS A chronic money-loser in part because the team's arena was built in a remote suburb of Sunrise. Managing partner Alan Cohen now hopes to merge the team and the arena with a publicly-traded sports acquisition fund directed by New York financier Andrew Murstein. This would provide badly needed cash to develop the real estate around the arena.
TAMPA BAY LIGHTNING NHL ownership has not gone smoothly for majority owners Oren Koules and Len Barrie on and off the ice. They are judged okay by their bankers so far, but could have trouble if the heirs of former owner Bill Davidson want to shed the hefty mortgage he took back on the club.
NEW YORK ISLANDERS Serial incompetence by a series of Islanders owners dragged a once-great franchise down to the status of charity case. Owner Charles Wang, who is fighting with local politicians over a proposed real estate development and renovations to Nassau Coliseum, recently said he wishes he never bought the NHL club.
NEW JERSEY DEVILS The locals never really embraced the Devils despite their excellence on the ice. Owner Jeffrey Vanderbeek hoped moving to a new arena in Newark, a little farther west on the New Jersey Turnpike, would goose revenue. But attendance dropped even further, and there are NHL governors who say the Devils are a source of concern.
DALLAS STARS Owner Tom Hicks has 180 days from March 31, when he defaulted on a series of loans, to negotiate a deal with more than 40 banks or they can put the Stars into bankruptcy. Hicks, with the support of NHL commissioner Gary Bettman, is playing hardball in negotiations and at least some of the bankers are angry enough to say they'll drive him to court.
ST. LOUIS BLUES Dave Checketts financed his purchase of the club in March of 2006, through an investment fund and a loan from a satellite television company. Banking sources say Checketts needed a turnaround in attendance by the time the loans came due. Thanks to the Blues' improvement in the past two seasons, he may clear that hurdle.
Editor's Note: Finally as we have figured would happen, it looks like Winnipeg will have a series of teams to choose from soon.
David Shoalts Monday, May. 04, 2009 04:23PM EDT
www.theglobeandmail.com/sports/hockey/showdown-in-the-desert/article1141760/
If Jim Balsillie's Coyote hunt comes to a quick end this afternoon at the hands of U.S. bankruptcy court judge Redfield T. Baum, it does not mean he will give up trying to put a second NHL team in Southern Ontario.
All it means is that the man who fuels the nightmares of NHL commissioner Gary Bettman will sit down with the architect of his pursuit, Toronto lawyer Richard Rodier, and pick another target. Then, when Balsillie and Rodier think the time is right, the roller-coaster ride will start all over again.
According to those familiar with their plans, there will not be an appeal if the judge rules against them on the key question of who controls the club, Phoenix Coyotes owner Jerry Moyes or the NHL.
If the judge rules that Moyes still owns the club and has the right to put it into bankruptcy and sell it to Balsillie, then the next step is the bankruptcy trial.
But if the judge sides with the NHL, which claims Moyes signed away control of the club last November when he stopped covering its enormous losses, then this particular fight is over for Balsillie before it even starts.
The judge could rule today or perhaps some time later after digesting the 100 or so documents filed by both sides.
Balsillie and Rodier believe their legal strategy can work.
The strategy is to buy an NHL team out of bankruptcy and then move it over the league's objections, by winning an anti-trust lawsuit if necessary. Losing the control ruling just means the Coyotes are no longer bankrupt, so they will not get a chance to try their strategy in court.
But the duo quite rightly believes there is a long list of likely candidates in a league that was already dealing with financially shaky teams in non-traditional markets and elsewhere even before the recession came along. Some of those owners are watching this ugly row closely because, if Balsillie prevails, there could be a run on the bankruptcy courts. In a few years, Canada may have more than enough NHL teams for everyone.
Thanks to the number of candidate teams for this, it is hard to say where Balsillie will cast his eye next if the judge sends him back to the starting line. The list of candidates, going in rough order from likely to least likely, includes the Atlanta Thrashers, Nashville Predators, Florida Panthers, Tampa Bay Lightning, New York Islanders, New Jersey Devils, Dallas Stars and St. Louis Blues.
The Thrashers are in the middle of their own bitter court battle. Minority owner Steve Belkin is fighting with the rest of the club's ownership group over the value of his 31-per-cent stake in the company that owns the Thrashers, the NBA's Atlanta Hawks and Philips Arena. Since the Thrashers were not tied to the arena by the bond issue the city made to finance it, they could be easier to move than the other teams.
But first the courts have to settle the fight over how much Belkin's share is worth before the other owners can buy him out. Only then can the Thrashers be sold. And this fight is so nasty there will not be any settlements on the steps of the courthouse.
The Predators bragged this season that they will turn a small profit. But that's only because they squeezed their payroll, bought their own tickets and raked in more than $20-million (all currency U.S.) from their NHL partners in revenue-sharing and escrow payments from the players, in addition to the regular shared NHL revenues like broadcasting.
There is also a bankruptcy court involved with this team. At stake is the share of the team owned by William (Boots) Del Biaggio III before he flamed out into bankruptcy and pleaded guilty to one count of fraud. It is the biggest single slice of the team and would put its winner at the top of the group of owners.
Before Moyes came calling last month, the Del Biaggio shares were Balsillie's preferred target, according to those who know him. They could be again.
***
ALSO SPUTTERING / WILL BALSILLIE KICK THE TIRES?
Aside from the Atlanta Thrashers and Nashville Predators, the other candidates for Jim Balsillie's next attempt to land an NHL team, should he be forced to try again, all have financial problems of varying degrees. Here is a quick look at them:
FLORIDA PANTHERS A chronic money-loser in part because the team's arena was built in a remote suburb of Sunrise. Managing partner Alan Cohen now hopes to merge the team and the arena with a publicly-traded sports acquisition fund directed by New York financier Andrew Murstein. This would provide badly needed cash to develop the real estate around the arena.
TAMPA BAY LIGHTNING NHL ownership has not gone smoothly for majority owners Oren Koules and Len Barrie on and off the ice. They are judged okay by their bankers so far, but could have trouble if the heirs of former owner Bill Davidson want to shed the hefty mortgage he took back on the club.
NEW YORK ISLANDERS Serial incompetence by a series of Islanders owners dragged a once-great franchise down to the status of charity case. Owner Charles Wang, who is fighting with local politicians over a proposed real estate development and renovations to Nassau Coliseum, recently said he wishes he never bought the NHL club.
NEW JERSEY DEVILS The locals never really embraced the Devils despite their excellence on the ice. Owner Jeffrey Vanderbeek hoped moving to a new arena in Newark, a little farther west on the New Jersey Turnpike, would goose revenue. But attendance dropped even further, and there are NHL governors who say the Devils are a source of concern.
DALLAS STARS Owner Tom Hicks has 180 days from March 31, when he defaulted on a series of loans, to negotiate a deal with more than 40 banks or they can put the Stars into bankruptcy. Hicks, with the support of NHL commissioner Gary Bettman, is playing hardball in negotiations and at least some of the bankers are angry enough to say they'll drive him to court.
ST. LOUIS BLUES Dave Checketts financed his purchase of the club in March of 2006, through an investment fund and a loan from a satellite television company. Banking sources say Checketts needed a turnaround in attendance by the time the loans came due. Thanks to the Blues' improvement in the past two seasons, he may clear that hurdle.
Editor's Note: Finally as we have figured would happen, it looks like Winnipeg will have a series of teams to choose from soon.