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The Coyotes Go To Reinsdorf

After being rejected by the NHL once again, Jim Balsillie vows to continue his quest of owning a NHL team in Hamilton. Apparently there is no 3rd time charm good ole Jimbo, as his offer to buy the Coyotes was unanimously rejected. I wonder if he learned anything from this whole process. I doubt it.

The NHL governors unanimously accepted Jerry Reinsdorf’s bid to buy the Coyotes, as they felt he was the best qualified potential owner.

From the Globe and Mail:

NHL deputy commissioner Bill Daly said in an e-mail message that Mr. Balsillie was rejected under bylaw 35 of the league’s constitution. That section says the league can reject potential owners if it does not believe they are of “good character and integrity,” as well as for financial reasons. Daly declined to comment when asked to be more specific.

I think it’s going to take some major ass kissing for Balsillie to get into the NHL. He needs to take a more business-like approach and stop challenging the league. It’s an ‘old boys’ network, and I don’t think the board of governors (the guys who ultimately decide his fate) like the way he has conducted his approaches to buying the Predators and Coyotes.

3 Comments

  1. Jim Clarke

    July 30, 2009 at 6:43 pm

    Sorry, but the Board of Governors vote the other day was meaningless. The judge is obligated by law to take the best deal for the creditors. Reinsdorf’s bid even
    though it’s being characterized at 148 mill, actually involves little cash, but is centered around assuming debt and negotiating deals with the creditors. It provides no money for Moyes.

    It’s going to go to an auction for those wanting to move the franchize, because the judge most certainly won’t
    accept the Reinsdorf bid given the size of Balsillie’s.

    And here’s why the boards vote was irrelevant. The judge stated earlier, that given that the BOG unanimously approved Balsillie’s purchase of the Pens,
    they can’t now arbitrarily reject him should he win the bidding for Phoenix, without demonstrating there’s been
    a _material_ change in RIM, his company.

    Unless, for example, he lost a ton of money and could no longer finance the purchase, or was discovered to be a serial killer, the board can’t reject him.

  2. Mark

    July 30, 2009 at 8:55 pm

    Hey Jim,

    I agree with some of what you said, and I don’t think I fully have my head wrapped around this whole process. I was just commenting on several aspects that were noted in the articles, that Balsillie was rejected by the NHL, and Reinsdorf was accepted.

    The auction to keep the team in Phoenix is Aug 5th, with Reinsdorf being the only official bid so far.

  3. Mark

    July 31, 2009 at 2:25 pm

    More money doesn’t always represent the best solution for creditors. The judge needs to take into account things like possibility for future revenue. Local businesses in Phoenix receive more money long term from having a team than they do from a one time cash out.

    The Reinsdorf position on Moyes is up for debate. Moyes claims that the money he put into the team was a loan. Reinsdorf claims it was an investment by the owner, that’s why he doesn’t feel it needs to be repaid. The judge will need to clarify this.

    Balsillies deal also has issues. City of Glendale invested 180 Million in the new arena just a few years ago. Balsillie is trying to break the lease and avoid it’s penalties through Bankruptcy court. The judge will need to decide on this as well.

    Jim I think you’re right that the NHL vote was irrelevant but to dismiss the Reinsdorf offer is wishful thinking. The judge may decide that the creditors are better served long term by having the team stay. And may or may not decide that the money owed moyes was investment not a loan.