Are the Phoenix Coyotes finally going to be sold?
In May 2010 the city of Glendale, AZ assured the NHL it would pay up to $25 million to the league to keep the Phoenix Coyotes in the city for the 2010-2011 NHL season. The NHL currently
owns the Coyotes and that money would be used to cover all operating losses incurred by the Coyotes for the upcoming season.
Reports coming from Glendale indicate that a potential buyer for the team has placed $25 million in escrow as a show of good faith, potentially freeing the city of its obligation to the
NHL. If the sale of the team does not go through, Glendale will need to put their $25 million back in escrow for the NHL.
Glendale has until December 31, 2010 to come up with a new owner for the Coyotes. If the city fails to do so, the NHL has indicated that they would seek to relocate the team. The NHL is
said to already have an agreement in place with a group of investors in Winnipeg to move the team to that Canadian city.
Before the franchise was known as the Coyotes they were the Winnipeg Jets. The team relocated from Winnipeg to Arizona in 1996.
Multiple reports out of Glendale indicate that the potential buyer is Chicago Investor Matthew Hulsizer. Hulsizer, a former collegiate hockey player, is the co-owner of PEAK6 Investments.
Hulsizer is the fourth potential purchaser of the Coyotes to emerge over the last two years.
Canadian businessman Jim Balsillie wanted to purchase the team in 2009 for $212.5 million. His attempted purchase was made under the condition that he be allowed to relocate the team to
Hamilton, Ontario. Balsillie’s offer came with a deadline of June 29, 2009. A judge rejected the sale under the condition that the deadline did not provide the court sufficient time to resolve all the issues surrounding the sale and relocation of the team.
In August 2009, a group headed by Jerry Reinsdorf looked like a potential buyer. However, the city would not capitulate to his demands for $45 million in subsidies. The deal between the
city and Reinsdorf, the owner of the Chicago Bulls and the Chicago White Sox, fell through when those demands were not met.
Next, all signs pointed to the team being sold to Ice Edge Holdings in May 2010. The sale to Ice Edge fell through when the city of Glendale failed to provide Ice Edge with exclusive negotiation
rights. Ice Edge chief operating officer Daryl Jones had this to say about the aborted purchase: “We were adamant about needing exclusivity in these negotiations and they haven’t provided it. I’m not totally surprised. We’ve been dealing with this for a while.
We thought we had agreed to certain things and expected them in writing. That didn’t materialize.”
After the three potential sales fell through, the NHL asked the city for $25 million to covering the possible operating losses for the 2010-2011 season.
It appears that if the sale to Hulsizer is approved, Ice Edge will hold a minority ownership stake in the Coyotes hockey club.
The next step in the current process is for Hulsizer and Glendale to agree on a lease that will allow the team to play in the Jobing.com Arena. After the lease is agreed upon by the city
council and Hulsizer, the NHL will work out a sale price for the team, believed to be between $160 and $170 million. Lastly, Hulsizer will need to be approved by the NHL as the new owner of the Coyotes.
Stay tuned to see if Hulsizer will finally put the ongoing saga that has been the sale of the Phoenix Coyotes to rest.