Tell me where we’ve heard this one before.
Team in a non-traditional hockey market is in financial trouble.
A whimsical super-rich maven from southern Ontario wants to grossly and disturbingly overpay for the team and move them to his home, back in Gary’s Hate Zone in Ontario, Canada.
Not sure where you read about this before?
It was right freakin’ here.
It’s like Jim Balsillie wants to keep me busy writing because after going after the Pittsburgh Penguins and the Nashville Predators and now he’s hot after the Phoenix Coyotes.
Why the Coyotes? Because their owner Jerry Moyes has filed for Chapter 11 bankruptcy.
“Extensive efforts have been undertaken to sell the team, or attract additional investors, who would keep the team in Glendale,” said Coyotes’ Chief Executive Officer and Managing Member Jerry Moyes.
“Creating a process under the supervision of a judge assures that anyone wishing to purchase the team will have the opportunity to bid. Likewise, the City of Glendale, which has been very cooperative with efforts to keep the team in Glendale, will be able to provide potential buyers assurances of the City’s willingness to offer incentives to keep the team as a tenant in the Jobing.com arena, the lease for which is subject to rejection in bankruptcy,” Moyes stated.
“The process assures that the identities of the new owner and the team’s location will be known by June 30, 2009, thus enabling the NHL to include the team in its 2009-10 schedule.”
Cutting things awfully close, aren’t we Jerry?
Then there’s the… Let’s call it “timeliness” of Balsillie’s offer to buy the Coyotes.
This evening myself, as well as other NHL bloggers, received an e-mail from the Managing Director of causeacommotion.com, letting us in about the efforts to help get the word out about Mr. Balsillie’s bid to buy the Coyotes and their urge to get folks to get connected at their website Make It Seven, a nod for the push to get a seventh NHL team to come to Canada.
From the official press release put out by the Make It Seven:
Jim Balsillie tabled an offer today to purchase the PhoenixCoyotes, following the team’s bankruptcy filing. The offer to purchase the team for $212.5 million (U.S.) is conditional on relocation to Southern Ontario, to become the seventh NHL franchise in Canada.
“The current team ownership asked that I table an offer to purchase the Coyotes and significant discussions resulted in an offer that is in the best interests of the franchise, the NHL, and the great hockey fans of Canada and Southern Ontario,” Mr. Balsillie said.
“I am excited to move closer to bringing an NHL franchise to what I believe is one of the best un-served hockey markets in the world, Southern Ontario. A market with devoted hockey fans, a rich hockey history, a growing and diversified economy and a population of more than 7 million people,” he said.
At the request of the Coyotes franchise owner, Mr. Balsillie has also agreed to post
debtor-in-possession (DIP) financing of $17 million (U.S.). Debtor in possession
financing is bridge financing provided when a company is in an insolvency proceeding which allows the company to continue to operate through the proceeding in advance of a restructuring or sale.
Prior to a final decision being reached on the proposed sale, he called for Canadian fans who want to see a seventh NHL franchise in Canada to make their voices heard.
Obviously, that’s a nice hand-picked piece of PR cotton candy fluff and you can’t expect me to eat it up.
So I’m not going to.
There’s something amiss here about how all of this just happened to blow up on the same night. It’s probably not out of the realm of possibilities that Moyes and Balsillie have been working on a plan together that is mutually beneficial, something hinted upon here by James Mirtle.
It gets Moyes out of being an NHL owner with an obscene lease agreement with the city of Glendale, Arizona that agreed to build him a new arena and back fully into his trucking company, Swift Transportation.
It then gives Balsillie the open door to play the White Knight and save a financially addled team and bring them back to his home in Canada.
Sounds great, doesn’t it? I know I sure thought so when Balsillie was doing this dance with the Predators before. The difference between then and now is that back then, it really seemed like he was doing the right thing.
This situation with Jerry Moyes and the Coyotes stinks to high hell and it’s so obvious that there’s something wrong here that even the NHL has declared shenanigans. From NHL Deputy Commissioner Bill Daly:
We have just become aware of today’s Bankruptcy Court filing purportedly made on behalf of the Phoenix Coyotes. We are investigating the circumstances surrounding the petition, including the propriety of its filing. We have removed Jerry Moyes from all positions of authority to act for or on behalf of the Club. The League will appear and proceed before the Bankruptcy Court in the best interests of all of the Club’s constituencies, including its fans in Arizona and the League’s 29 other Member Clubs.
You see that? Balsillie and Moyes served the NHL, the NHL served right back – now it’s officially on.
The response to all this from blindsided Coyotes fans is not pleasant. There are too many posts to link over at Five For Howling, but I urge you to give it a look and a bookmark to keep tabs on this situation because over the next few weeks there’s going to be a lot happening with this.
You would think that after going through this song and dance with the NHL and the Board of Governors twice already that Balsillie would have a better plan of attack and would actually, you know, really try to sweeten up to these old farts and curmudgeons and make them want to take his millions of dollars.
Instead (let me flex my geek muscles here) he’s playing the part of Admiral Ozzel in The Empire Strikes Back thinking that surprising the Board of Governors was the best way to go about getting his way.
Now’s the part where I get to bust out with a Darth Vader comeback for Jim Balsillie, and it’s tough for me to say this considering the guy is the inventor of the friggin’ BlackBerry but: You’re as clumsy as you are stupid.
Since the NHL has basically seized control of the Coyotes until the bankruptcy hearing on Thursday and depending on the outcome of that what we’ve got brewing here is a situation that makes folks recall the plight of the Montréal Expos in Major League Baseball.
Think about it. Shifty ownership making a brash move to get what they want, the league shuffles pieces around to make it work all the while taking control of a team while they search for a new owner.
Remember how that turned out? Yeah… not so well for Montréal.
So what is the end game here? Obviously for Balsillie it’s to obtain the Coyotes and get them moved to Hamilton, Ontario, Canada. It always has been and it always will be his motive and he’s obviously got the money to burn to pull it off… Just so long as he plays nice enough with the NHL to make it work – something he seems to either not know how to do or not want to do.
I always was quick to side with Balsillie and bought the whole push before about just wanting to do right by the game of hockey and bring a team back “home” to Canada. Now that he’s teamed up with a shyster like Jerry Moyes to try and fast track a deal to get himself a team and run screaming away from a situation that while dire and God-freaking-awful with that wretched lease agreement
For Moyes it’s to get out of owning the Coyotes and away from losing multiple millions of dollars in Glendale, Arizona under a lease agreement that won’t allow him to just pick up and leave on his own. Between Balsillie and Moyes, Moyes comes across like the truest villain of the bunch as he’s more than ready to just walk away from everything. Considering that the City of Glendale has more often than not helped him out, he doesn’t seem to care about the team, the city and certainly not about the fans.
Keep on truckin’ asshole.
As for the NHL and Gary Bettman… Saving face. That’s always the trick with the league but this time they’ve been put in a bad place by Moyes and Balsillie alike and after seeing how things transpired this evening, the NHL has a pretty strong case on their hands to stuff it in Moyes’ face hard that he’s the guy that screwed this up. The catch there is that it still leaves the NHL on the hook with the team and figuring out what to do with the Coyotes and their overbearing lease agreement.
If the NHL and the City of Glendale can get a renegotiated lease agreement figured out, there’s no reason why finding a more reasonable buyer for the team can’t be found thus giving Moyes what he wants but still boning over Jim Balsillie.
Then again, perhaps Balsillie should’ve thought better about teaming up with Jerry Moyes to try and pull a fast one on everyone. I dig Balsillie, I dig his passion and I dig his love of hockey. I also like that he’s a crazy bastard and would really be a great owner to have around to mess with Bettman.
What I can’t believe is that a guy who is this good of a businessman with BlackBerry would be this obviously reckless in dealing with the NHL. It blows my mind that this guy could be this dumb about business and go for what amounts to be a hostile takeover of the Coyotes.
He has to know that if things are that out of hand with the ownership that the league would just step in and take over. He couldn’t possibly think this was a coin flip deal where either the team goes bankrupt and folds or he steps in and plays the hero.
What Jim Balsillie apparently hasn’t realized is that the professional sports world, especially the NHL, doesn’t operate by the same rules and use the same handbook that the real world does and this is a lesson he’s continuing to learn the very hard way. The highest bid doesn’t always win in the NHL and hostile takeovers just don’t happen.
The NHL operates in Bizarro World. Plain and simple and going by the executive world playbook is not going to get it done, especially when everyone else in the board room seems to hate your guts.