Friday, September 4, 2009
Coyotes to be auctioned off next week
PHOENIX -- More documents flooded the U.S. Bankruptcy Court in Phoenix on Friday, and the head of Ice Edge insisted his bid is still alive and will viable when the bankrupt Coyotes are sold at auction next week.
"We remain confident we will finalize everything that needs to be done by Thursday," Ice Edge CEO Anthony LeBlanc said in an e-mail to The Associated Press.
Ice Edge, a partnership of eight American and Canadian investors, was a late starter in the bidding and its bid is contingent on several factors, specifically reaching a deal on a new lease agreement with the city of Glendale.
NHL's board of governors has yet to vote on Ice Edge's proposed ownership, either. Ice Edge would keep the team in Glendale but wants to play five games in Saskatoon, Saskatchewan.
Canadian billionaire James Balsillie is offering $212.5 million to buy the team, contingent on moving it to Hamilton, Ontario. The NHL at the last minute submitted its own bid of $140 million to buy the team, then sell it outside of bankruptcy.
Judge Redfield T. Baum planned to continue reading the court documents and deposition transcripts over the holiday weekend in preparation for the auction.
The judge has yet to rule on several critical issues, including whether Balsillie could buy the team and move it over the vehement objection of the NHL. The league's board of governors voted 26-0 to reject Balsillie as an owner.
Since the league made its bid, Balsillie's attorneys have argued that the NHL has a conflict of interest as a bidder and an entity that rejected a competing bid.
Coyotes owner Jerry Moyes took the team into Chapter 11 bankruptcy on May 5 with the plan to sell it to Balsillie. Under the Balsillie bid, Moyes would get $104 million of the $300 he says he loaned to the team.
Both the Ice Edge bid, which it says could reach $150 million, and the NHL offer would give Moyes next to nothing, contending the money should be subordinated to other debtors and is equity, not a loan.
Documents filed by attorneys for the debtors group headed by Moyes rebuffed that contention, saying signed loan papers exist to prove the claim.
The judge also has not ruled on whether the city of Glendale's lease can be broken without serious penalty under bankruptcy law.
The NHL has warned that if it wins the bidding, it must negotiate a new lease agreement with the city in a hurry or the franchise will have to be relocated. A group headed by Chicago sports mogul Jerry Reinsdorf pulled out of the bidding, citing inability to reach an agreement with Glendale.
Glendale spent $183 million to build Jobing.com Arena specifically for the Coyotes and faces the prospect of having no lead tenant for the facility, which is adjacent to an entertainment center and across the street from University of Phoenix Stadium, home of the NFL's Cardinals.
The NHL Players Association filed a document Friday saying it would consent to the Balsillie and NHL bids but not the Ice Edge offer.
With training camp set to begin next Saturday, Baum has noted that the sale almost certainly won't be wrapped up before the season begins. He also expects appeals to whatever ruling he makes.
Balsillie has said he may have to begin the season in Glendale, then move to Hamilton as quickly as possible. NHL officials have ridiculed that idea. The league wants the judge to rule that the team will play the coming season in Glendale.
Balsillie, at Wednesday's court hearing, said he would agree to keep the team in Glendale for a season if the league splits the losses. Commissioner Gary Bettman said the league isn't interested in that idea.
The number of documents filed in the case has soared past 900. As if that wasn't enough, the judge has asked for full transcripts of all depositions given in the complicated case.