Dallas Stars: Dallas Stars sale

Dallas Stars announce Gaglardi as new owner

November, 18, 2011
The Dallas Stars have made the announcement that Vancouver businessman Tom Gaglardi is the team's new owner. Here is the release from the Stars:
Tom Gagliardi, President of Northland Properties Corporation, today purchased the National Hockey League Dallas Stars. The new owner will be introduced Monday at a news conference at American Airlines Center.

Gaglardi (pronounced guh-lar-dee) announced that he has named Jim Lites as the President and CEO of the Dallas Stars. Gaglardi said he believes that Lites will give a huge jump-start to the team as it works to recharge the Dallas Stars and fan experience.

“Jim Lites is the right guy at the right time to reposition and lead the franchise forward,” said Gaglardi. “I like his vision, resilience, marketing expertise and his total energy for this job,” said Gaglardi, “and he and I share a huge love of this game. “

The 43-year-old Gaglardi is the President of Northland Properties Corporation, the largest family-owned hospitality company in Canada. He has played hockey since he was five years old, and, in fact, he continues to play hockey on a Canadian competitive team. Gaglardi has noteworthy Texas roots; his mother is a Longview native, and he has “serious UT relatives” who live west of Fort Worth.

“I know the fans and the organization are relieved that this period of uncertainty is over,” said Gaglardi. “The team has established a solid foundation, and I am looking forward to working with Jim Lites and Joe Nieuwendyk, who I have always admired and think is doing a superb job, to reignite fan enthusiasm for this club.”

Lites, 58, is very familiar with his position having held it twice previously. Lites returns to the Stars with a reputation as one the finest administrators in professional sports. Over the course of his two prior stints with the Stars (1993-2002; 2003-2007), the team won seven Division Championships, two Western Conference Championships, two Presidents’ Trophies, and the 1999 Stanley Cup. Lites also served 11 years as COO of the Detroit Red Wings from 1982-1993. Since 2007, he managed the New York Football Giants’ Personal Seat license program at its new stadium in East Rutherford, New Jersey. In addition, he has been a consultant to Worldplay Networks, a highly successful technology company in Calgary.
The NHL Board of Governors has voted to approve Tom Gaglardi as the new owner of the Dallas Stars, according to a source.

With the board not meeting until early December, a fax vote was conducted on the Stars sale. A fax vote requires unanimity rather than the three-fourths majority required for a vote during a board meeting.

Now that the board vote is complete, Gaglardi is in position to take control of the Stars quickly after Friday's court hearing in Delaware, where the sale of the team to the Vancouver businessman and the Stars' prepackaged bankruptcy plan are expected to be approved.

The Stars are expected to make an official announcement Friday on the approval of the sale to Gaglardi, along with announcement on the hiring of Jim Lites as president of the club. Gaglardi is expected to be introduced at a press conference in Dallas early next week, most likely Monday.
It looks like new ownership will bring back a familiar face to the Dallas Stars front office.

Multiple sources confirm that former Stars president Jim Lites will return as the team’s president when Vancouver businessman Tom Gaglardi takes over as the team’s new owner.

Lites served as Stars president from 1993 to 2007, except for a short period in 2002 when he was president and CEO of the Phoenix Coyotes.

Gaglardi could be announced as the team’s new owner as early as Friday. A court hearing is scheduled for Friday morning in Delaware, where a judge is expected to approve the sale of the team to Gaglardi and approve the club’s prepackaged bankruptcy plan.

Meanwhile, another part of the process is complete. A source confirmed Wednesday evening that the NHL's Board of Governors already has voted to approve Gaglardi as the new owner of the Stars. The vote was done via fax, and that requires a unanimous vote.

Gaglardi is the President of Northland Properties Corporation, which he and his family run. The company owns and operates hotels and restaurants throughout Canada.

Gaglardi also leads the ownership group of the Kamloops Blazers of the Western Hockey League. The ownership group includes Shane Doan, Mark Recchi, Jarome Iginla and Darryl Sydor.

The Stars are expected to formally introduce Gaglardi at a press conference early next week, possibly on Monday.

Court hearing to approve Stars sale moved up

November, 10, 2011
The sale of the Dallas Stars is getting a little closer to being finalized. In fact, the process has been moved up a bit.

According to court documents filed yesterday, the hearing in bankruptcy court to approve the sale to Vancouver businessman Tom Gaglardi will now come November 18 instead of November 23.

The combined hearing, which will be held at 8:30 a.m. (CST) on Friday November 18 in Delaware, will also deal with the Stars’ prepackaged bankruptcy plan and other parts of the team’s bankruptcy filing with the court.

Court approval is one part of the process. Approval of the NHL Board of Governors and closing of the sale also are needed for the deal to be finalized. The NHL Board of Governors doesn't meet until December, but approval can be can be granted prior to that. It is usually done with board members voting via fax.

Gaglardi could be the new owner in less than two weeks.

No other bidders for Stars

October, 24, 2011
No bids for the Dallas Stars were filed by this past weekend’s deadline, which now clears the way for stalking horse bidder Tom Gaglardi of Vancouver to complete the purchase of the Stars.

The next step in the process is a November 23 hearing in a Delaware bankruptcy court, where the court will consider “approval of the Sale, and confirmation of the Debtors’ Prepackaged Plan and any objections thereto and to consider any other matter that may properly come before the Bankruptcy Court.”

Approval of the NHL Board of Governors and closing of the sale also are needed for the deal to be finalized.

NHL Deputy Commissioner Bill Daly issued a statement on the Stars sale Monday.

"Now that the bidding deadline has been reached, we will continue our due diligence process and will proceed with the Board's ownership transaction review process," Daly said. "We also will work with the courts in the continued hope of bringing this matter to a successful and expeditious resolution."

Gaglardi is the President of Northland Properties Corporation, which he and his family run. The company owns and operates Sandman Hotels, Inns and Suites, Denny’s Restaurants of Canada, Moxie’s Restaurants, Shark Clubs and . Northland owns 45 hotels with 6,400 rooms, owns more than 100 restaurants, and employs more than 10,000 employees.

Gaglardi leads the ownership group of the Kamloops Blazers of the Western Hockey League. The ownership group includes Shane Doan, Mark Recchi, Jarome Iginla and Darryl Sydor.

Gaglardi, a life-long hockey fan, has strong Texas ties. His mother is from Longview and he has family in the Dallas-Fort Worth area.

He’ll take over a team that, according to court documents, lost $37.9 million in the last fiscal year and $91.5 million over the last three seasons. The Stars are expected to lose $31 million this season.

Court documents state that Gaglardi is “committed to keeping the Stars in Dallas and rebuilding the franchise both in terms of on-ice success and the fan experience.”

Chuck Greenberg won't bid on Stars

October, 21, 2011
Former Texas Rangers CEO Chuck Greenberg will not be bidding on the Dallas Stars. Greenberg made his intentions known this evening, posting on Twitter:
“Disappointed but not bidding on Stars. New long term TV deal was key to turnaround plan. Got very close but could not get agreement.”

Greenberg, in a text message, explained a little more about his decision.

"Long term TV deal was essential to turnaround plan. Committed to invest heavily and immediately in championship roster and first class fan experience," he said. "Tough to make those long term commitments without matching security on local media deal. Really disappointed.

"No doubt we could turn things around but without local media security it's like constructing a building atop an unstable foundation."

Greenberg’s announcement comes as a key deadline in the sale of the Dallas Stars will come this weekend. Anyone interested in topping the stalking horse bid of Vancouver businessman Tom Gaglardi must have a bid in by 3:00 p.m. (Central Time) on Saturday.

Saturday’s deadline comes 30 days after bidding procedures were approved in a Delaware bankruptcy court. Although the deadline is Saturday it may not be known until Monday if anyone else has stepped forward.

Greenberg was seen as the leading candidate to jump into the mix and with him deciding not to bid, it appears to clear the way for Gaglardi to complete the purchase of the Stars.

If another bidder did step forward, and at this point it appears unlikely, his bid would have to be approved by lenders and the NHL. That could set the stage for an auction at a law office on November 21.

With or without an auction, a hearing is scheduled in a Delaware bankruptcy court for November 23 that would, according to court documents, “involve approval of the Sale, and confirmation of the Debtors’ prepackaged Plan and any objections thereto and to consider any other matter that may properly come before the Bankruptcy Court.”

There is a chance the court could move up the process if there are no bidders besides Gaglardi.

After that it would take a few days to close the sale and the sale would also need approval from the NHL Board of Governors.

Court approves bidding procedures for Stars

September, 22, 2011
A bankruptcy court in Delaware today approved bidding procedures concerning the sale of the Dallas Stars.

Bids are due 30 days from today. An auction would be held November 21 in Dallas and according to court documents, a confirmation hearing to approve the sale to the winning bidder has been scheduled for November 23.

Vancouver businessman Tom Gaglardi has reached an agreement to buy the Stars, but his offer is subject to competing bids through the bankruptcy process.

Lawyers for former Texas Rangers CEO Chuck Greenberg, who has expressed an interest in bidding for the Stars, were in court for today’s hearing in Delaware.
Here’s a brief timeline of how things should play out as the far as the Dallas Stars sale now that it has entered the courts.

*Monday: Hearing in Delaware to approve motions.

*Next week, or soon after: Another hearing in Delaware to approve auction procedures.

*30 days after auction procedures are approved (probably late October): Deadline for other potential bidders to seek approval to bid against Tom Gaglardi to purchase the Stars.

*30 days after the bid deadline (probably late November): If there are multiple bidders, then an auction will be held to determine the new owner of the Stars.

*After the auction: The court and the NHL will need to give approval, and then it will take a few more days to close the sale.

It's estimated, depending on how things plays out, the Stars should have a new owner in approximately 60 to 75 days.

Unsecured claims

Here’s a partial list of some of the unsecured claims against the Stars. I picked the largest ones and a few of the more notable ones. There were several more, including a lot of signing bonus money for players still in their entry-level deals.

Stars release on sale, bankruptcy

September, 15, 2011
Here's the Dallas Stars release on the proposed sale to Vancouver businessman Tom Gaglardi and today's bankruptcy filing in Delaware.
The current owner of the Dallas Stars National Hockey League Club, Dallas Stars, L.P., announced today that it and certain of its affiliates have signed an agreement to sell the Stars and all hockey-related assets to entities owned by Vancouver businessman Tom Gaglardi and his family, subject to a court approved auction and NHL approval.

To facilitate the sale, Dallas Stars, L.P. has commenced a voluntary chapter 11 bankruptcy case in the United States Bankruptcy Court for the District of Delaware in Wilmington, including the filing of a “prepackaged” chapter 11 plan. The chapter 11 process has the support of the National Hockey League and the Dallas Stars’ lenders, who voted to accept the prepackaged plan prior to filing. The prepackaged plan provides for a court-supervised auction of the Dallas Stars Club and other hockey-related assets. The purpose of the sale is to allow for a smooth transition in ownership, while ensuring that the Dallas Stars continue to play at the American Airlines Center in Dallas. The Plan provides that the Dallas Stars will pay and perform all of its obligations to its fans, players, employees, and vendors.

The Dallas Stars Club is unequivocally committed to remaining in Dallas and playing its home games at the American Airlines Center. To that end, no bid submitted will be considered that contemplates moving the team from the American Airlines Center in Dallas.

The auction process and sale are subject to Bankruptcy Court and National Hockey League Board of Governors approvals.

The prepackaged plan is the result of negotiations involving input from the National Hockey League and certain of the Club’s senior secured lenders. Because the plan has already garnered substantial support from the Club’s lenders, the Club expects to move through the legal process expeditiously and has requested that the Court hold a hearing in 60-75 days to confirm the plan and proposed sale, allowing the Stars to exit bankruptcy and complete the sale of the franchise by the end of November.

“This is a significant step toward completing the transition in ownership,” said Stars President Tony Tavares. “We are pleased that our lenders have shown substantial support for the plan and the sale process, but the Dallas Stars are focused on one thing: hockey. The players and coaches begin Training Camp on Friday and we are all excited to start the new season.”

The Dallas Stars believe that the legal process will not have an impact on Dallas Stars hockey or its business operations—it is business as usual for the Dallas Stars. The Club has obtained permission from its lenders to use its available cash on hand to fund operations while in chapter 11, and believes this amount is sufficient for such purposes until the sale is finalized.

The Club filed customary motions seeking to ensure that:
  • The Stars will be able to operate within their existing budget to sign and acquire amateur, international and professional players;
  • Purchased tickets will continue to be honored;
  • The fan experience at the American Airlines Center will be unchanged, with all current amenities and promotions continuing as usual;
  • All salaries will be timely paid; and
  • Stars vendors and suppliers will be fully paid in the ordinary course of business.

The Dallas Stars expect to present all of the customary motions for approval by the Bankruptcy Court at a hearing to be held in Wilmington Monday.
The sale of the Dallas Stars is expected to move into court this week, possibly as early as Wednesday.

Although Wednesday has been target date for the Stars to file a prepackaged bankruptcy plan in a Delaware court there is the possibility it could happen later in the week.

The filing will begin a process that should have a new owner in place somewhere in the neighborhood of 60 days, perhaps a little longer.

Vancouver businessman Tom Gaglardi has submitted an offer to purchase the team, and that is considered a stalking horse bid in the bankruptcy process. That process will allow for the possibility of other potential bidders to top Gaglardi's offer. Time will tell if others who have expressed an interest in the team over the past year will try to outbid Gaglardi.

The sale of the team apparently hitting the drive comes at the same as the team is getting ready to hit the ice for training camp in Prince Edward Island this weekend. And hockey, not the happenings in a Delaware court, is the focus right now for Stars GM Joe Nieuwendyk.

“It’s business as usual,” said Nieuwendyk, who is at the NHL Prospect Tournament in Traverse City. “We’re at the prospect camp right now and we’re getting ready and getting excited about Prince Edward Island. We have a season to prepare for.”

Quotable: GM Joe on Stars ownership

September, 1, 2011
During Stars GM Joe Nieuwendyk’s appearance on Fan 960 in Calgary this morning, he was asked about the latest on the Stars ownership situation and if the uncertainty over ownership was hampering his ability to do business as a general manager. Nieuwendyk's response:
“No, quite the contrary. Obviously we’re going through this sale process and it is taking probably longer than any of us had anticipated. It is moving. I know that speaking with the league this thing will get resolved this season, prior to Christmas. It’s just been a long process. The good thing is it hasn’t taken away from anything what our team has been able to do. We increased our budget and went after players that could fill roles on our team and help us. We added seven players this summer and I feel really good about our team. We’ve been able to keep our off-ice issues away from the locker room and I think the guys are excited about the upcoming season.”

Nieuwendyk’s time frame is similar to what Tom Gaglardi, the Vancouver businessman who is trying to buy the Stars, said at the beginning of August. This all includes the sale winding its way through the courts to find out who the new owner will be.

The next big step is for a purchase agreement to get finalized and for the process to move into the courts. The latest word is that the case could be filed with the court by the middle of this month, just prior to training camp. Once it is filed we should start getting a better sense of how long the process will take and how it might play out as we wait to see if Gaglardi or another possible bidder will be the new owner of the Stars. Stay tuned.

Tom Gaglardi talks Dallas Stars sale

August, 11, 2011
Vancouver businessman Tom Gaglardi, who is trying to buy the Dallas Stars, appeared on a Kamloops, British Columbia Radio station today and talked about his bid to buy the club.

Gaglardi is currently trying to finalize an offer for the Stars which would serve as a stalking horse bid. That would be a first step in the process, which would include a trip through bankruptcy court and other suitors getting a chance to top Gaglardi’s bid.

Here are Gaglardi’s comments about the sale from his interview on CHNL 610 AM in Kamloops.

On his efforts to buy the Dallas Stars

“That’s a work in progress. It’s been going for well over a year. It’s a team that I have great interest in and hopefully close to concluding the agreement to acquire the team. But still it will be subject to a long, lengthy court process given the history of the Stars and Rangers credit facilities. Although we might get something done here quickly, it is still a few months away in terms of where we know where this thing lands and who ends up owning the club.”

When asked if his deal would include the club, taking over some debt and a half interest in the American Airlines Center


Why Dallas?

“My mother is from there, so I have half my family living in the Dallas/Fort Worth area. I used to go there every summer to visit grandparents and aunts and uncles until I got too old to keep doing that. There’s a huge familiarity with me being in that marketplace. Other than most of the Canadian teams and some original six teams, Dallas, to me, would be in the top six teams personally for me to be involved with. It’s now the fourth largest market in America. Huge growth potential and the most valuable franchise in the world in headquartered there, the Dallas Cowboys. I think it is a marvelous opportunity in a market that is second to none, and a market that used to lead the NHL in revenue. “

When asked when it will be known if something falls together for him

“I would think two to four months is the window to get through a court process and those things. That would be the time frame we are looking at.”