Balsillie shelves dream of owning Coyotes
Jim Balsillie’s dream to “make it seven” is over. Balsillie ended his bid to buy the bankrupt Phoenix Coyotes and move them to Hamilton after his offer was rejected Wednesday by U.S. Bankruptcy Court Judge Redfield T. Baum, who also rejected the National Hockey League to buy the beleaguered franchise.
Jim Balsillie’s dream to “make it seven” is over.
Balsillie ended his bid to buy the bankrupt Phoenix Coyotes and move them to Hamilton after his offer was rejected Wednesday by U.S. Bankruptcy Court Judge Redfield T. Baum, who also rejected the National Hockey League to buy the beleaguered franchise.
Balsillie, the billionaire co-CEO of BlackBerry maker Research in Motion, said he would not appeal the judge’s decision.
“From the beginning, my attempt to relocate the Coyotes to Hamilton has been about Canadian hockey fans and Canadian hockey,” Balsillie said in a news release. “It was a chance to realize a dream. All I wanted was a fair chance to bring a seventh NHL team to Canada, to serve the best unserved hockey fans in the world. I believe I got that chance. I respect the court’s decision, and I will not be putting forward an appeal.”
Balsillie, through his company, PSE Sports and Entertainment, and the NHL were the only bidders in an auction for the Coyotes, who’ve been in Chapter 11 bankruptcy protection since May.
“In hockey parlance, the court is passing the puck to the NHL, who can decide to take another shot at the sale net or it can pass off the puck,” Baum wrote in his 30-page ruling.
Baum rejected the PSE’s bid “with prejudice,” saying Balsillie’s bid could not be successful because it doesn’t meet the NHL’s rules about relocating a franchise. The NHL’s bid was rejected “without prejudice,” meaning he left the door open for the NHL to modify its bid and could not rule on an offer he has yet to see.
“It’s a major victory for the NHL and, more generally, it’s a major victory for professional sports leagues: maverick prospective owners can’t alter the rules at their own choice. This ruling is limited to the NHL, but other leagues had an interest in this case,” said Michael McCann, an associate professor of law at Vermont Law School and a columnist and legal analyst for SI.com.
Even if Balsillie had appealed the ruling, McMann said the effort might have been fruitless.
“In all likelihood, I think it’s the end of the road,” McCann added about Balsillie’s efforts to buy the team. “It seems that the end game is that (Balsillie) will not own a team in the NHL because of the will reject him. No matter what, at the end of the day, he does not end up with the team.”
Baum rejected the NHL’s bid because he said it gives the league the power to determine which creditors will be paid in full. He wrote that with a revised bid, the NHL could become the team’s owner, saying the NHL_can “cure the defects in its bid if it elects to make the required amendments.”
NHL deputy commissioner Bill Daly was encouraged by Judge Baum’s ruling.
“We are pleased that the bankruptcy court has confirmed the league’s right to select its owners and the location of its franchises,” Daly said in a news release. “We are reviewing the opinion and considering how we can best address the court’s concerns regarding our offer to purchase the Coyotes. It remains our goal to secure the long-term stability of the Coyotes in Glendale.”
The NHL vehemently opposed Balsillie’s bid and entered its own $140-million US bid when other suitors — Chicago sports magnate Jerry Reinsdorf and Ice Edge Holdings, a group of U.S. and Canadian investors — dropped out of the bidding process. After Baum rejected both bids, Ice Edge appears to be back in the picture.
“We have continued to work with the city of Glendale throughout this process and believe we will be in a good position to put in a competitive offer for the team when the NHL is finally awarded the franchise,” Ice Edge CEO Daryl Jones said in an e-mail Wednesday afternoon. “Needless to say, we are very encouraged by the judge’s ruling.”
Ice Edge had said it would pay up to $150 million for the Coyotes and would keep the team in Arizona, playing at Jobing.com Arena in Glendale. It did say it wanted to play a number of regular-season games and perhaps some playoff dates in Canada, most likely Saskatoon.
Although the group received a positive response from the NHL for its bid, Ice Edge withdrew from the bidding just days before the Sept. 11 and 12 auction because it hadn’t made sufficient headway with the city of Glendale regarding the lease for Jobing.com_Arena.
The court process began in May when PSE Sports and Entertainment put in a $212.5-million offer to buy the Coyotes after current owner Jerry Moyes put the team into bankruptcy protection. PSE later boosted that bid to $242.5 million. Balsillie tried to stoke grassroots support by launching an online “Make it Seven” campaign where fans could show their support for moving the Coyotes to Hamilton.
Balsillie, who previously made attempts to buy the Pittsburgh Penguins and Nashville Predators, was rejected as a prospective owner by the NHL’s board of governors, who in July voted 26-0 against accepting Balsillie as an owner. The board cited character issues in its rejection of Balsillie.
Nonetheless Balsillie believes his efforts weren’t for naught, saying his push has shown that Canadians would support another team north of the border.
“Nobody can deny that we are now a big step closer to having a seventh NHL team in Canada,” Balsillie said in a release. “It doesn’t matter who owns that team. When that day comes, I will be the first in line to buy a ticket to the home opener.”