Bid to buy, move Coyotes has deadline
PHOENIX -- Jim Balsillie's bid to purchase the Phoenix Coyotes and move the franchise to southern Ontario will be withdrawn if it isn't approved by the U.S. Bankruptcy Court by the end of June.
Balsillie's deadline appeared in documents filed Tuesday by the attorneys for Coyotes owner Jerry Moyes.
The Canadian businessman says the sale must be completed before the end of next month to allow for setting the team's schedule for the coming season, finding sponsors and a television deal, readying its new home arena in Hamilton, Ontario, and resolving other matters.
"A sale cannot drag on through the summer of 2009," the document says.
Balsillie has offered $212.5 million to purchase the team, contingent on moving it to Canada. The NHL wants to find a buyer to keep the franchise in Glendale and says Balsillie needs league approval to purchase and move the team.
A hearing on the sale timeline and other matters is scheduled Wednesday before Redfield Baum, chief judge of the U.S. Bankruptcy Court in Phoenix. Baum has indicated skepticism over such a condensed schedule, saying it would not be fair to other potential buyers.
NHL attorney Tony Clark said in court that there is no way the league's owners could approve the sale and transfer of the team so quickly. According to court documents, Balsillie applied to the NHL for approval to buy the Coyotes last week and will file an application by next Monday to relocate the franchise.
However, Moyes' attorneys contend the judge has the authority under federal bankruptcy law to order the team moved without the NHL's approval.
That possibility has brought the NFL, Major League Baseball and the NBA into the case, each asking the judge to respect the rules and regulations of professional sports leagues.
Baum has scheduled a June 22 hearing for arguments on the relocation issue.
Moyes' filing says that neither Balsillie "nor any other known entity will fund another year of significant losses" operating the team in Arizona. The NHL has funded the team since last August.
Balsillie is the only official bidder for the team. Phoenix attorney Scott Cohen said last week that his client, Las Vegas-based businessman John Breslow, was interested in submitting a bid that would keep the team in Glendale. The NHL also said a group headed by Jerry Reinsdorf -- owner of baseball's Chicago White Sox and the NBA's Chicago Bulls -- was ready to submit a letter of intent to purchase the team when Moyes, to the league's surprise, filed for bankruptcy on May 5.
The Coyotes have not made a profit since the franchise moved to Arizona from Winnipeg in 1996. Documents show the team lost $74 million the last two years. Moyes, whose Phoenix-based trucking firm also is in financial trouble, says he has $300 million invested in the Coyotes and would recoup about $100 million under Balsillie's proposal.
Meanwhile, the city of Glendale plans a court fight to hold the Coyotes to the 25 years remaining on their lease to play in Jobing.com Arena. The issue is whether by declaring Chapter 11 bankruptcy the franchise can evade the lease.
Moyes' attorneys proposed a June 12 deadline for submission of competing bids, with the auction and sale of the franchise to be held June 24, two days before the NHL draft.
Any claim by the NHL for additional time to review the ownership and relocation applications "does not outweigh the burden facing Coyotes Hockey's estate and its creditors if the offer [by Balsillie] is lost," Moyes' filing said.
Moyes and the NHL said they had reached agreement on the interim operation of the team. Under the agreement, Moyes and the NHL would have a "point person" to oversee the club's operations. If there's a disagreement between the two, the matter would be turned over to the court.
The NHL contends that proxies signed by Moyes in November gave the league control of the club, and Moyes did not have the authority to take the team into bankruptcy. Moyes' attorneys argue that the NHL never exercised such control, and proxies were only for team's voting rights in the league.
Baum had ordered the two sides into mediation on the issue, with the status of those talks on the agenda for Wednesday's hearing.
Copyright 2009 by The Associated Press
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