Ice Edge Taking Aim At Coyotes Again

((HT: GlobeSports/Waldie))
Surprising no one in particular, Ice Edge Holdings has decided to go after the Phoenix Coyotes again and not move them from the desert- a move, those of us at OSG HQ are sure, the National Hockey League likes a great deal...

“Our plan has always been to buy it and operate in Phoenix,” he said.

Ice Edge is made up of eight Canadian and American businessmen, including former Research In Motion Ltd. executive Anthony LeBlanc and John Breslow, a current co-owner of the Coyotes.

Jones also told Waldie that Ice Edge has lined up financing for the bid. “We feel pretty confident with our financing,” he said.

And they still want to do the "couple of home games in Saskatoon idea" that hasn't been approved by the NHL yet, either...

Jones said the group is confident it can make NHL hockey work in Phoenix.

“We’re sticking in this because we believe there is a fan base there that exists, that wants to support the team and wants to go to games,” he said.

Those of us at OSG HQ would like to say good luck with that one...

Breslow Named As Investor In Ice Edge's Coyotes Bid

((HT: Arizona Republic/Watters))

A former employee of Jim Balsillie’s company is part of an investment group that intends to bid on the Coyotes in U.S. Bankruptcy Court.

A coincidence is how representatives for Ice Edge Holdings, LLC described Anthony LeBlanc’s connection to the man who attempted to move the team to Canada.

Meanwhile, the group, which on Friday filed a letter of intent to bid up to $150 million for the Coyotes, also named John Breslow among its investors. The Las Vegas resident is a minority owner in the franchise and has served as chairman of Coyotes Charities.

Anthony LeBlanc would act as chief executive of the Coyotes if the group’s bid wins. The Ottawa, Canada resident is a former vice president of global sales for Research in Motion, the maker of Blackberry wireless.

Balsillie, the co-CEO of Research in Motion, rankled Phoenix hockey fans when he offered $212.5 million to purchase the bankrupt Coyotes and relocate the team to Hamilton, Ontario.

A bankruptcy judge set Balsillie's offer aside until it is determined if a buyer willing to keep the team in Glendale can be found. Ice Edge Holdings is among two investment groups to come forward.

Daryl Jones, who has been speaking on behalf of the group, previously told The Arizona Republic he never met Balsillie, but declined to name all of the investors in his group.

On Saturday, Jones confirmed LeBlanc as a partner and his connection to Balsillie after a Canadian news report surfaced. Jones said he wanted to downplay the connection because it in no way influenced his group's interest in the team.

"There's a reason we didn't want this to get out. We just don't think it's relevant to the story," Jones said.

The group’s known investors now include: LeBlanc, Breslow, Jones and Keith McCullough, who works with Jones at a Connecticut-based investment research firm, Research Edge. Coyotes coach and minority owner Wayne Gretzky and others also may become partners, Jones said.

Jones called LeBlanc’s nine-year employment at Research in Motion a "non-starter" and a "strange coincidence."

LeBlanc left the company less than a year ago, he said.

Balsillie's attorney Richard Rodier called it "entirely coincidental," as well. He said Balsillie's group has not communicated with LeBlanc on his efforts to acquire the team.

Jones said Ice Edge Holding's intent is "100 percent" to keep the team in Arizona for the long haul. "We would be having absolutely no plans to leave," Jones said.

He also discounted speculation by a Canadian radio show that the Coyotes could play some of their games in Hamilton. "This is a Phoenix franchise. This is not a Hamilton franchise," Jones said. An auction of the team is Aug. 5, but the deadline to submit bids was Friday.

Jones' group missed that deadline, saying they only began exploring the team's finances three weeks ago. The group did file its intent to bid, and Jones said a detailed offer should be in place by the auction.

The only completed bid for up to $148 million came from Glendale Hockey, LLC, which includes sports mogul Jerry Reinsdorf, Valley attorney John Kaites and former sports executive Tony Tavares.

((Jobing.com arena is pictured, thanks Carlos Chavez/Arizona Republic))

Coyotes Lost $60-Million Since 2006

((HT: GlobeSports/Waldie))

With bids for the Phoenix Coyotes due in an Arizona bankruptcy court today, the club has revealed it lost more than $60-million (all currency U.S.) last season.

Documents filed in court show the club's hockey operations posted a $27.1-million loss for the year ended June 30. Hockey revenue, which came largely from ticket sales, totalled $58.3-million, about $7-million less than the club expected.

The net loss, which included interest payments and other costs, was $67.1-million, according to the filing.

The hockey operations have lost well over $20-million annually in each of the last three NHL seasons, according to documents filed in court.

The Coyotes filed for Chapter 11 protection in May and an auction for bidders who will keep the team in Phoenix is slated for Aug. 5.

Bids for that auction are due today and so far only one proposal has been filed, an offer worth up to $148-million from Jerry Reinsdorf, owner of the Chicago Bulls and Chicago White Sox.

Another group led by Daryl Jones, of Research Edge LLC in New Haven, Conn., has indicated that it is planning to make a bid.

If the Aug. 5 auction fails to deliver a decent offer, the bankruptcy court will hold another auction on Sept. 10 to relocate the club. Jim Balsillie has offered $212.5-million to move the Coyotes to Hamilton.

The NHL had indicated in court filings that four groups were interested in buying the club and keeping it in Phoenix. They consisted of Reinsdorf; Howard Sokolowski and David Cynamon ((pictured, thanks GlobeSports file)), owners of the CFL's Toronto Argonauts; John Breslow, a current Coyotes co-owner; and another unidentified Phoenix businessman.

Sources familiar with the auction say the Argo co-owners have not participated in negotiations to buy the club and that Breslow plans to join one of the other bidding groups. The unnamed Phoenix businessman is also believed to be interested only in investing about $20-million with another bid.

Reinsdorf's proposal carries several conditions, including a new arena lease and concessions from creditors. “He doesn't want to pay a whole lot for this team. He's not going to get into any sort of bidding war,” said a source close to the auction.

Yesterday NHL deputy commissioner Bill Daly expressed confidence that the auction will result in a new owner who will keep the club in Phoenix. “We always have felt that way,” he said in an e-mail. “It continues to be our feeling. But we're not in total control of the process.”

It is not clear what will happen to Wayne Gretzky, the Coyotes' coach and co-owner. In an interview last week, Jones said his group is eager to work with Gretzky, but it's not clear what that would involve. A source familiar with the auction said Reinsdorf has not been clear about his intentions toward Gretzky, who has declined to comment on the sale process.

New Bidder In Coyotes Game...?

((HT: GlobeSports/Waldie))

The NHL has been approached by another potential bidder for the Phoenix Coyotes who wants to keep the club in Arizona.

The NHL disclosed the new bid in a court filing yesterday but did not provide any details.

“The League has been informed that this bidder will submit an application for transfer of ownership, but does not know whether the prospective purchaser will submit a definitive bid by July 24,” the NHL said in the filing in the Arizona bankruptcy court.

The Coyotes filed for Chapter 11 protection on May 5, and the bankruptcy court is holding an auction on Aug. 5 for bidders who will not relocate the club.

Potential offers were due on June 26 and so far the only bid has come from Jerry Reinsdorf, owner of the Chicago White Sox and Chicago Bulls. He has proposed buying the club for up to $148-million (U.S.), but his offer carries several conditions, including negotiating a new lease with the city of Glendale, the Phoenix suburb that owns the arena where the team plays. In its filing, the NHL said Reinsdorf is working “diligently” with the city and other creditors to finalize his offer.

The NHL did not explain why the new bidder did not meet the June 26 deadline. The league said the bidder “has requested access to, and spent time in, the due diligence data room” in order to put together an offer.

In earlier court filings, the NHL has suggested that other bids could come from Toronto Argonauts owners Howard Sokolowski and David Cynamon, as well as Coyotes minority owner John Breslow.

The NHL filed the motion to block a request from lawyers representing current majority owner Jerry Moyes. They want the court to force the league to disclose detailed information about Reinsdorf’s bid. Moyes’s group also wants to question commissioner Gary Bettman and several other league officials about the offer and other potential bids. Glendale has made a similar request to examine Moyes and other Coyotes officials – including part owner Wayne Gretzky ((pictured, thanks GlobeSports file)).

The NHL has argued that whatever information Moyes wants will be available when Reinsdorf submits his final bid, which is due on July 24.

If the court determines on Aug. 5 that the auction did not result in a sufficient offer to cover creditors, a second auction will be held in September for bidders who want to relocate the club. So far only Canadian businessman Jim Balsillie has made an offer, worth $212.5-million, to move the Coyotes to Hamilton.

Brunt: Don't Take Coyotes Bids At Face Value

((HT: GlobeSports-Stephen Brunt))

If David Cynamon and Howard Sokolowski are indeed interested in buying the Phoenix Coyotes and keeping them alive in Arizona – as suggested in an affidavit sworn by NHL commissioner Gary Bettman – it would come as a huge surprise to many who know them.

That’s because the owners of the CFL’s Toronto Argonauts have been actively pursuing a very different agenda: Landing an NHL team that could be uprooted and relocated to a new arena in the Greater Toronto Area.

Cynamon and Sokolowski have been quietly fleshing out that plan for months now, and have discussed it, at least informally, with both the owners of the Toronto Maple Leafs and with the NHL commissioner.

As recently as March, Sokolowski met with Bettman at the NHL’s New York offices.

And the two Toronto businessmen have met with potential investors and sketched out the design for an NHL-ready arena as part of a larger development on the federally-owned lands at Downsview in the city’s north end, dubbed “Hockeyland.”

They have also recently explored the possibility of purchasing at least one other struggling, portable NHL franchise.

Now, according to Bettman’s sworn statement, Cynamon and Sokolowski have experienced a remarkable epiphany and are ready to bid for the chance to own and operate a franchise thousands of kilometres from home which has lost in the neighbourhood of $100-million (U.S.) over the last four seasons.

Asked about that this past weekend, Sokolowski refused to comment. “Out of respect for the process, we are referring all questions to the league,” he said.

Well, perhaps it’s possible. Perhaps the Argos owners suddenly see possibilities in Phoenix that are invisible to just about everyone else – including Paul Kelly, the head of the NHL Players’ Association, who opined this past week that it was time to “pull the plug” on the Coyotes.

But there is also a far more plausible explanation: Cynamon and Sokolowski believe that by allowing their names to be placed before the bankruptcy court among those who “have indicated an interest in operating the franchise in Phoenix,” they can curry favour with the league and gain the inside track on a second Toronto team, whether it’s the Coyotes, another ailing club or an expansion franchise.

If that’s the true story, Bettman is being at the very least misleading, if not disingenuous, by suggesting Cynamon and Sokolowski have any real interest in operating in Phoenix – beyond perhaps swallowing losses for a season or two before being granted permission to move to Ontario.

And there’s no mistaking what Bettman is saying in his affidavit, which reads, in part: “These local expressions of interest in owning the Coyotes, as well as the passion of the community fan base as evidenced by the ‘Save the Coyotes’ campaign and the City of Glendale’s willingness to participate in enhanced partnership initiatives designed to improve the team’s performance in the state-of-the-art Jobing.com Arena, all indicate that relocation may well be unnecessary and is certainly premature for the 2009-10 season.”

So let’s get this straight: The NHL believes wholeheartedly that the Coyotes can survive in Glendale and is absolutely opposed to the team being sold and relocated to Southern Ontario, but is now open to offers for the team from individuals who the commissioner knows have been planning to do exactly that.

Makes you wonder about the reality of the three other “bids” mentioned in Bettman’s affidavit from Chicago White Sox and Chicago Bulls owner Jerry Reinsdorf, Coyotes minority partner John Breslow, and an unnamed “Phoenix businessman.”

How legitimate are they, and what’s the real long-term strategy behind them?

Makes you wonder about the NHL’s actual commitment to the Phoenix market and those loyal fans Bettman loves to talk about. It certainly seems as though that might be lip service, to be abandoned just as soon as they win the current court battle.

Makes you wonder just how desperate Bettman and the league have become to stop Canadian tycoon Jim Balsillie from doing on his terms what they seem willing to allow someone else to do on theirs (though the Maple Leafs might have other ideas).

The plot thickens.

Four Bid To Keep Coyotes In Phoenix

((HT: CP))

Toronto Argonauts owners Howard Sokolowski and David Cynamon are among four potential buyers to express an interest in purchasing the bankrupt Coyotes and keeping them in Phoenix, NHL commissioner Gary Bettman said in a court filing.

The four parties submitted preliminary background applications this week seeking league approval to buy the troubled club, which Canadian billionaire Jim Balsillie is trying to buy out of Chapter 11 protection for US$212.5 million and move to Hamilton over NHL objections.

Two of the applicants had already linked to the club -- Chicago White Sox and Bulls owner Jerry Reinsdorf, who'll partner with John Kaites; and Coyotes minority owner John Breslow -- but the interest of Sokolowski and Cynamon came out of left field.

The fourth applicant is a Phoenix businessman who requested anonymity pending the NHL's due diligence, and there was no further detail offered on any of the bids.

Should attempts to find an owner to operate the team in Phoenix fail, the NHL added, it would then look to move the club.

The revelations came as part of the filing briefs submitted ahead of a midnight Friday deadline set by Judge Redfield T. Baum, who will hear arguments on whether Balsillie can move Coyotes in an Arizona bankruptcy court Tuesday.

The Argonauts did not offer any comment Saturday and Sokolowski and Cynamon did not immediately reply to email requests sent by The Canadian Press.

The documents draw out the case each side will make in the bitter fight for control of the Coyotes, who according to current owner Jerry Moyes have never made a profit in the 13 years since moving from Winnipeg and lost more than US$316 million.

The NHL cites the four potential buyers in arguing that maintaining the league's consent rights in a sale would not adversely affect creditors, and Bettman says in his declaration that he expects more bidders willing to keep the team in Phoenix to follow.

The league also argues that efforts to find a new owner for the Coyotes were "cut short by the debtors' (Moyes') precipitous and unnecessary rush into Chapter 11" and that if no ownership is willing to keep the club in Phoenix, "the league will find a purchaser for another location in co-operation with this court, and in accordance with the league's transfer and relocation rules and procedures, that will maximize the recovery for creditors."

The brief also goes on to defend its claims that Moyes didn't have the right to sell the team conditionally based on a move to Hamilton and that only the league can approve the relocation of its member clubs.

The Balsillie camp's brief hammers away at those arguments, underlining the view that the Coyotes aren't viable in Phoenix and breaking down any notions of veto power, territorial rights and compensation held by or owed to Toronto Maple Leafs.

By brushing aside Balsillie's bid, the brief states, the NHL is acting "to the detriment of all creditors," and that the best way to protect the creditors is by allowing them to move.

"The Coyotes hockey team is worth considerably more if relocated than if kept in Glendale, Arizona, and would enable a substantially greater recovery to the debtors' creditors," the brief said.

The Balsillie camp also argues that it has met all criteria under NHL bylaws for both purchase and relocation, and suggest that "emotions and personalities have clouded the objectivity of the league's decision-making process."

Also clouding the league's judgment is the NHL's desire "to protect the Toronto Maple Leafs and to leave the Hamilton geographic franchise opportunity open for the league to seize later."

Coyotes Losing Eight Figures In Coming Weeks

((HT: GlobeSports/Waldie))

The Phoenix Coyotes expect to lose nearly $17-million (all currency U.S.) on operations during the next few weeks while the club’s future is determined by a bankruptcy court in Arizona.

The Coyotes filed a budget in court this week as part of their request for emergency financing to get through the Chapter 11 process.

The budget lists weekly revenue and expenses until July 25 and shows a cumulative shortfall of $16.7-million. The club expects to pull in around $275,000 most weeks, reflecting corporate sponsorships and ticket sales to various events at the Jobing.com arena, which the Coyotes manage, according to the filing. Expenses range from $680,000 to more than $3-million during one week as various bills come due.

One of the largest single expenses involves a payment to Wayne Gretzky ((pictured, thanks GlobeSports file)) , a part owner and the team’s head coach.

The budget filed this week includes a line that reads “revenue sharing – WG comp.” There is one payment under that heading – $625,000 this week. An earlier version of the budget filed in court shortly after the club filed for protection showed a second payment of $650,000 during the last week of June. That payment is not shown on the latest budget.

Gretzky paid $1-million for a 1.5-per-cent stake in the Coyotes and was entitled to receive a 14-per-cent cut of any profits, according to documents filed in court. That was a far better deal than other investors received. For example, another investor, Jim Wikert, also paid $1-million for a 1.5-per-cent share but was entitled to just 1 per cent of profits, the documents showed. And John Breslow who spent $2-million for a 3-per-cent stake, was supposed to receive a 2-per-cent share.

It is unlikely that any of them received profit sharing at all because club executives have said in court filings that the Coyotes never made money since moving from Winnipeg in 1996. The club expected to lose $29.1-million on operations during this fiscal year, which ends on June 30, according to documents filed in court.

The NHL has agreed to finance the club during the bankruptcy-protection process. The NHL has already lent the Coyotes $13.4-million under a line of credit set up in February. The Coyotes will continue to draw on that line of credit, which is unlimited, according to court filings.

Canadian businessman Jim Balsillie was going to provide up to $17-million in so-called “debtor in possession” financing when the Coyotes filed for protection on May 5. But the NHL and another creditor objected because Balsillie’s loan would be given priority over other loans. There were also concerns about Balsillie providing financing while also making a bid to buy the club. All sides reached a deal out of court that left the financing in the hands of the NHL.

Balsillie has offered to pay $212.5-million for the Coyotes and move the club to Hamilton. Under his offer, Gretzky would receive as much as $22.5-million. The league has opposed Balsillie’s bid, saying it violates league rules governing relocation.

The budget filed in court also showed that the club pays about $200,000 a week to cover a loan from MSD Capital LP, which manages money for computer magnate Michael Dell. The Coyotes owe MSD roughly $80-million.

The Coyotes have 50 players under contract, filings show, and they have all been paid for the 2008-09 season. The budget shows four payments labelled “player signing bonus.” Three of the payments are in July and are $357,500, $700,000 and $150,000. One payment is in June, $65,000. It is not clear who the money goes to.

Add Another To The Coyotes Mix...

((HT: Canwest))

According to the Arizona Republic, John Breslow, one of the Coyotes' minority partners, is siding with the NHL in its bid to block the sale of the team to Canadian businessman Jim Balsillie, who has made an US$212.5-million offer to buy the team with the intention of moving it to Hamilton.

The Republic reported Tuesday that Breslow, through his lawyer, Scott Cohen, has confirmed that he's a part of a group of potential buyers who want the Coyotes to remain in Phoenix. The lawyer also said that Breslow is not part group that includes Chicago White Sox owner Jerry Reinsdorf, who other than Balsillie is the only suitor who has made public his desire to buy the Coyotes.

The Coyotes' case returned to U.S. Bankruptcy Court in Phoenix on Tuesday.

The NHL has claimed that it controls the team, after loaning team owner Jerry Moyes millions in February to keep the team afloat. Moyes counters that he still controls the team, because despite the loan, no one from the NHL had any input on the day-to-day operations of the team.