Wednesday, June 10, 2009
Balsillie: "One Step Closer"
Jim Balsillie ((pictured, thanks CP file)) says he's "one step closer" to bringing the Phoenix Coyotes to Hamilton even though the Canadian billionaire may have to pay the NHL a hefty relocation fee to do it.
Balsillie made the statement on his website Wednesday, a day after a hearing in U.S. bankruptcy court on his bid to buy the Coyotes and move them over the objections of the NHL.
On Tuesday, Judge Redfield T. Baum said he believes the NHL has the right to request a relocation fee -- which could amount to US$100 million or more -- and suggested he might force the league to establish a price by granting the motion to relocate the Coyotes in order to settle the bitter standoff.
Baum is considering the matter and plans to issue a ruling in the near future.
Balsillie has offered US$212.5 million to purchase the Coyotes, conditional on a move to Hamilton and closing by month's end. However, Balsillie's lawyer, Susan Freeman, said her client would walk away if the relocation fee was too exorbitant.
On Wednesday, Balsillie seemed to leave the door open.
"However it works out, the issue of a relocation fee, while a new development, does move us one step closer to bringing the Coyotes to Hamilton," the co-CEO of BlackBerry maker Research In Motion said on www.makeitseven.ca. "I am fighting for Canadian hockey fans because I know you've been out there fighting for my bid."
Balsillie also assured fans who have supported his cause that he is still moving toward his goal.
"We're looking forward to instructions from Judge Baum," he said. "But you should know as a makeitseven.ca supporter that I am committed to continuing and winning this fight to bring a seventh NHL team to Canada."
His campaign has been aggressive so far. He's already unveiled plans to renovate Hamilton's Copps Coliseum should the Coyotes come to town and he has recruited corporate partners in his cause, with Prime Restaurants, DeWalt Tools and FirstOntario Credit Union the latest to sign on, joining Labatt Blue and Home Hardware .
On Wednesday, the Balsillie camp declared June 19 "Make It Seven Day" across Canada, encouraging fans to rally support for the cause that day.
Should Balsillie walk away from a third attempt to buy an NHL team, the other thorny legal issues before Baum would not need to be solved since if not paid by the buyer, the relocation fee would leave too little money for the creditors.
And under that scenario, it appears the NHL would get its wish for a Sept. 10 auction of the club, with at least one more Coyotes season in Phoenix.
Freeman said she expects the NHL to demand $100 million as a relocation fee -- a number the league hasn't confirmed and that was blacked out in court documents -- and deputy commissioner Bill Daly refused to speculate Tuesday on how much would be enough.
"I don't think we are prepared to put out a number," Daly told reporters. "That's something that is generally determined by the board of governors in the context of a relocation application and from our perspective, we have a couple of steps before we get to a relocation application."
Tuesday's hearing was the latest step in the back-and-forth wrangling over the team's future since Coyotes owner Jerry Moyes caught the NHL by surprise and filed for Chapter 11 protection May 5.
More than 300 documents have been filed with an Arizona bankruptcy court since, making each side's argument in the contentious case.
The NHL contends Balsillie's bid is an attempt to skirt the league's rules on the transfer of ownership and relocation, arguing attempts should first be made to sell the team to a buyer who would keep it in Phoenix, despite over $300 million losses since the franchise moved to the desert from Winnipeg in 1996.
Commissioner Gary Bettman said in a court filing that four interested parties filed preliminary applications last week with the intent of operating the Coyotes in Arizona.
Among them are Toronto Argonauts owners Howard Sokolowski and David Cynamon, and Chicago White Sox and Bulls owner Jerry Reinsdorf.
Baum was not impressed with the prospective buyers, however.
"This old judge isn't all that excited about expressions of interest," Baum said.
While their bids aren't expected to top what Balsillie has on the table, the NHL argues his offer is actually $165 million once the $25-million owed to the league and $22.5 million due to coach and part owner Wayne Gretzky is factored in.
The NHL also believes the Coyotes could be viable where they are under new ownership and with new concessions of about $15 million annually the City of Glendale, home to the team's arena, is apparently willing to make.
Balsillie and Moyes disagree in their briefs, saying the Coyotes have never turned a profit since the former Jets flew south, and that the club would flourish in Hamilton.
Posted by John V. Wood at 7:17 PM