Friday, June 19, 2009
Balsillie Agrees On Auction, Wants Different Rules
Jim Balsillie ((pictured, thanks CP)) has conceded ground in his battle with the NHL over the future of the Phoenix Coyotes and agreed to participate in an NHL-arranged auction for the club in September.
In a court filing last night, Balsillie formally renewed his offer to buy the Coyotes for $212.5-million (U.S.) out of Chapter 11 protection and move the club to Hamilton. But he dropped his demand that the deal close by the end of June. Instead, Balsillie’s lawyers said he would participate in a court-supervised auction the NHL wants to hold on Sept. 10.
However, Balsillie and the Coyotes’ current majority owner, Jerry Moyes, want to change the rules for the NHL auction.
They also want a judge to order the NHL to participate in mediation on relocation issues, including a relocation fee the league can seek if the club is allowed to move.
Balsillie “has indicated [his] willingness to continue to bid for the team and the assets,” the filing said.
The NHL has proposed that only bidders willing to keep the Coyotes in Phoenix be allowed to participate in the September auction. The league claims it has four potential bids for the club from investors who would not move the team.
However, the NHL has not provided any details. The league has said that if the bids are too low, it would seek to hold a second auction soon afterward for bidders interested in moving the club.
In last night’s filings, lawyers for Balsillie and Moyes said there is no point holding two auctions. They proposed one auction on September 10 for all bids. That “will increase the potential bidder pool and also potentially increase the value to be received for the assets,” the filing said.
A single auction will also “enable a sale closing before the next hockey season, whether the sale involves relocation of the club,” the filing added.
“It does make sense for all parties, in any event, to have relocation bids considered at the auction along with any bids to keep the team in Glendale,” Balsillie’s filing added, referring to the Phoenix suburb where the Coyotes play.
Balsillie’s filing said he “believes it is still possible to play in Hamilton this year, however, and will accommodate as much as [he] can to enable a delayed sale to occur.”
The filing also said Balsillie doubts there will be any other offers to relocate the Coyotes “because there are few cities with hockey arenas but no hockey teams.”
Under the auction proposal put forward by Balsillie and Moyes, the NHL would have to decide on Balsillie’s relocation application by July 31. Balsillie filed the application a couple of weeks ago and his lawyers have argued the league has been unreasonable in its handling of his request. However, in a court ruling this week, Arizona bankruptcy judge Redfield T. Baum dismissed Balsillie’s concerns and said he had not given the league enough time to review the application. In last night’s filing, Balsillie and Moyes said they believe July 31 would be enough time.
The filings also said that lawyers for Moyes and Balsillie have asked the league twice to participate in mediation over the relocation fee issue. However, the league has not responded. Therefore, Moyes’s lawyers have now asked Judge Baum to “order and direct [all sides] to mediate the issues surrounding the relocation application and the issue of a transfer fee with respect to that relocation application.”
Judge Baum is expected to hold a hearing next week on all the auction proposals.
By the way, did you know it's "Make It Seven" Day in Canada Friday...???
Posted by John V. Wood at 1:28 AM