Phoenix bankruptcy/ownership Part XI: A Fistful of Dollars?

[LadyStanley]

http://hfboards.com/showthread.php?t=667073

Continuation from part X.

Click to read more...

 

[Brodie]

The odds of Reinsdorf pulling out seem pretty high to me.

 

[Kritter471]

The odds of Reinsdorf pulling out seem pretty high to me.

I think it's all just posturing.

Everyone is trying to get the maximum negotiating angle on this. He's no different.

 

[bbud]

The odds of Reinsdorf pulling out seem pretty high to me.

looks like he would have to bring cash up to pay off some of the parties, and likely backlash from taxpayers at COG would be a bad thing with what he wants in subsidy it would make it a hard sell now anyways.

 

[LadyStanley]

The odds of Reinsdorf pulling out seem pretty high to me.

I think a lot will have to do with "how smoothly" negotiations with COG and SOF go.

There have been threats from almost May 4 that he might pull out; reasons include public scrutiny (of a fairly private man), arena lease negotiating points released.

There's got to be a point where no matter how much schmoozing the NHL, BOG, Phoenix interests do won't be enough to placate Jerry.

Or it could be a negotiating posture.

 

[bbud]

I think a lot will have to do with "how smoothly" negotiations with COG and SOF go.

There have been threats from almost May 4 that he might pull out; reasons include public scrutiny (of a fairly private man), arena lease negotiating points released.

There's got to be a point where no matter how much schmoozing the NHL, BOG, Phoenix interests do won't be enough to placate Jerry.

Or it could be a negotiating posture.

Its hard to imagine he can beleive the situtaion wont be public and very scrutinized by fans , media and now local citizens groups hes asking for a lot from them.

 

[RR]

Fugu wrote:

RR-- you keep insisting that the NHL dictates to the judge, not the other way around. If anything, the judge wanted everyone to go through the process, probably so he could decide if there were skeletons in the closet or anti-trust, or whatever the case may be. Kind of why he told JB to apply in the first place, no?

Not at all, Fugu. Just trying to point out that for every assertion the judge makes that seems to support one side, he makes another that seems to support the other side. For every "NHL can't reject JB cause Judge said NHL must show a material change and there has been none," there's the judge saying he understands the NHL's position in rejecting Balsillie.

No question who rules that courtroom, and he's done a great job to not tip his hand as to what way he's leaning, other than to say he knows no matter what he decides litigation will follow.

 

[guyincognito]

people are just seeing what they want to see right now, because they have rooting interests. if JR did step aside, the next thing would be how Ice Edge doesn't work.

 

[bbud]

people are just seeing what they want to see right now, because they have rooting interests. if JR did step aside, the next thing would be how Ice Edge doesn't work.

I do think the judge will have an open auction at some point which will be interesting to say the least.

 

[guyincognito]

I do think the judge will have an open auction at some point which will be interesting to say the least.

I doubt there will be an open auction, because of the big three.

 

[bbud]

I doubt there will be an open auction, because of the big three.

it may not be but at some point the process will have to be opened up unless NHL wants to run Pho an unknown length of time hoping to find a way .

 

[guyincognito]

it may not be but at some point the process will have to be opened up unless NHL wants to run Pho an unknown length of time hoping to find a way .

they'll find someone. if they don't find anyone, it makes it easier on the judge, but otherwise, he's going to punt. it sets a nasty precedent for the other leagues and I would guess he would rather not do that. it doesn't matter either way, because it would get kicked upstairs, but in general, you don't want to screw with the NFL.

if he were to award to JB against the NHL's wishes (even them being ambivalent would be preferable), I would guess the other three sports leagues would be involved in the next step of the process, because they are now in a position of having to cover their own tails.

 

[Hammertown]

A few questions/observations:

1. It's obvious the Glendale taxpayers and the COG, are going to take a HUGE bath on any local bid winning the auction. That's if the council doesn't get cold feet, now that the terms have been leaked, and vote down the concessions to JR or Ice Edge due to HUGE public backlash. Mind ya, COG takes a bath with Balsillie too, if he relocates, cause they're left with that huge white elephant and still have to make bond payments.

2. If Reinsdorf or Ice Edge can't persaude Dell to change his mind and take terms, do either of them even bid since neither wants to put up 80 million in cash to satisfy Dell, even if they can get concessions from COG and new agreements/terms from the other creditors.

3. What is the effect on the Westgate businesses when they're all of a sudden charging an additional 11.5 percent tax on goods/services? I would say their business would plummet. I know if I go out for dinner in Westgate, or buy a jersey, or whatever, and I have to suddenly pay an extra 11.5 percent I'd for sure be reconsidering.
So instead of 100 bucks that jersey now costs me 111.50. Times are tough, every dollar counts.

4. I wonder too who gave or leaked the concession negotiation information to Moyes. That will most surely come out in the contempt hearing when Baum says to Moyes, where did you get this info anyways, cause you weren't supposed to be privy to negotiations between the COG and Reinsdorf. I agree with the earlier poster, probably someone with morals, who thought the deal stunk for the taxpayers, leaked it to Moyes.

5. Does anyone know for sure/has anyone seen a copy yet of Balsillie's new offer, whether it does in fact have no conditions. My bet on that is that he disguises it as a local bid then does a midnight move. The court accepts it at face value, local bid, satisfies all the creditors including Dell (who wants his cash). Then challenges the NHL on not approving Balsillie because now he's a local bidder right, isn't that what the NHL wants. Finds there was no 'material' change to PSE's status since 2006.

6. Dell knows, the longer this goes, and the more the NHL is owed for funding the team through bankruptcy, ahead of him, the less the chances are of him being made whole.

7. Did I read that right that Reinsdorf's attorney said if this wasn't settled September 10th that Reinsdorf was out of the running cause they couldn't close then?
Also that Reinsdorf has 0 financing lined up so far?

8. Funny how now it comes out that Bettman told Balsillie that the Standard 7 year no movement clause would be waived for Pittsburgh but it appears in the final print. Also Bettman says the Executive Committee made him put it back in there. Lemieux's money man backs up Balsillie on this. Daly denies it of course.

 

[guyincognito]

A few questions/observations:

1. It's obvious the Glendale taxpayers and the COG, are going to take a HUGE bath on any local bid winning the auction. That's if the council doesn't get cold feet, now that the terms have been leaked, and vote down the concessions to JR or Ice Edge due to HUGE public backlash. Mind ya, COG takes a bath with Balsillie too, if he relocates, cause they're left with that huge white elephant and still have to make bond payments.

2. If Reinsdorf or Ice Edge can't persaude Dell to change his mind and take terms, do either of them even bid since neither wants to put up 80 million in cash to satisfy Dell, even if they can get concessions from COG and new agreements/terms from the other creditors.

3. What is the effect on the Westgate businesses when they're all of a sudden charging an additional 11.5 percent tax on goods/services? I would say their business would plummet. I know if I go out for dinner in Westgate, or buy a jersey, or whatever, and I have to suddenly pay an extra 11.5 percent I'd for sure be reconsidering.
So instead of 100 bucks that jersey now costs me 111.50. Times are tough, every dollar counts.

4. I wonder too who gave or leaked the concession negotiation information to Moyes. That will most surely come out in the contempt hearing when Baum says to Moyes, where did you get this info anyways, cause you weren't supposed to be privy to negotiations between the COG and Reinsdorf. I agree with the earlier poster, probably someone with morals, who thought the deal stunk for the taxpayers, leaked it to Moyes.

5. Does anyone know for sure/has anyone seen a copy yet of Balsillie's new offer, whether it does in fact have no conditions. My bet on that is that he disguises it as a local bid then does a midnight move. The court accepts it at face value, local bid, satisfies all the creditors including Dell (who wants his cash). Then challenges the NHL on not approving Balsillie because now he's a local bidder right, isn't that what the NHL wants. Finds there was no 'material' change to PSE's status since 2006.

6. Dell knows, the longer this goes, and the more the NHL is owed for funding the team through bankruptcy, ahead of him, the less the chances are of him being made whole.

7. Did I read that right that Reinsdorf's attorney said if this wasn't settled September 10th that Reinsdorf was out of the running cause they couldn't close then?
Also that Reinsdorf has 0 financing lined up so far?

8. Funny how now it comes out that Bettman told Balsillie that the Standard 7 year no movement clause would be waived for Pittsburgh but it appears in the final print. Also Bettman says the Executive Committee made him put it back in there. Lemieux's money man backs up Balsillie on this. Daly denies it of course.

if he pulled an Irsay after posing as a "local bidder", I'm pretty sure he'd get the franchise revoked.

 

[Dogbert*]

Again, I don't think that an open auction would only have the three bidders. There are other cities who want teams and other bazillionaires who have the money; they just aren't involved yet.

 

[guyincognito]

Again, I don't think that an open auction would only have the three bidders. There are other cities who want teams and other bazillionaires who have the money; they just aren't involved yet.

JB destroys any value to be found here, though. You'd have to be willing to pay a premium for the Phoenix Coyotes. There have to be better deals out there than that.

 

[Hammertown]

JB destroys any value to be found here, though. You'd have to be willing to pay a premium for the Phoenix Coyotes. There have to be better deals out there than that.

Exactly, so if it got as far as a relo auction and that mystery KC bidder steps up, they're going to have to top 212.5 in cash, plus the relocation fee for KC (alot lower than S. Ontario of course).
There would also be the damages to the COG for breaking the lease, whatever those end up at.
A steep price for the KC market.
That's a rabbit I'd love to see the NHL pull out of their hat.

 

[MAROONSRoad]

This below article was linked in the previous thread, but didn't receive much discussion. It's a great read and, if true, helps explains how Moyes is getting shafted -- not only by the NHL, which appears to be hanging Moyes out to dry despite his floating the franchise in Glendale at a loss in 100s of millions -- but by the city of Glendale and a close knit group including city manager Beasley, lobbyist Kaites, Jerry and Michael Reinsdorf and firms such as IFG and Beacon Sports Capital Management. If the information in this article is true, it could be very damaging to the City of Glendale and the Reinsdorf bid.

From the Phoenix New Times article:

The record suggests...that Glendale City Manager Ed Beasley is trying his best to hand over the Coyotes to his friend, lobbyist John Kaites, and Kaites' Chicago buddy, Jerry Reinsdorf. The deal might well suck for the team's current owners (who stand to lose millions) and its creditors (who suggest they're getting a raw deal)...

...Glendale is a town run by its city manager, Beasley. And city records suggest that long before Beasley let on to the city's elected officials that the Coyotes were in trouble, he was helping to wire the deal for Reinsdorf and Kaites...
In the fall of 2008, Coyotes owners Jeff Shumway and Jerry Moyes began explaining to City Manager Beasley just how bad the team's financial situation was. They asked the city to sweeten the pot and give them incentives to help the team stay in Glendale.

Instead, in October, Beasley inked a deal with a small Massachusetts firm, Beacon Sports Capital Management...Beacon was in Glendale for just three days. And during that time, according to Beasley's own calendar, the sports analysts actually had a meeting with Kaites and Reinsdorf!...

Ed Beasley [also] brought in Michael Reinsdorf's firm. At the suggestion of Michael's firm, he brought in a second company, one that had a history of dealing with Michael Reinsdorf. Then he stood by as that firm secretly met with Kaites and Jerry Reinsdorf.

Link:

http://www.phoenixnewtimes.com/2009-07-30/news/glendale-the-coyotes-and-the-john-kaites-connection/1

GHOST

 

[voxel]

So if the NHL ran the Yotes for another year they could become the largest secured creditor? (i.e assuming $60M/yr in losses).

In that hypothetical future, MSD/Michael Dell (the current largest secured creditor) would then make a deal with the new owner - asking for less than $80M owed, right?

NHL appears to have the upper hand - they can block any relocation and any non-approved sale - while increasing their influence in bankruptcy court (which is limited, currently).

IMO what the NHL is trying to do is find a sucker to eat the losses or a slimeball who can extract subsidies from Glendale.

 

[XX]

IMO what the NHL is trying to do is find a sucker to eat the losses or a slimeball who can extract subsidies from Glendale.

It's not really a subsidy, at least not in the traditional sense. A subsidy would be more in line with Glendale simply eating the Coyotes losses, giving up their claim to rent or something along those lines. Giving them a cut of a new revenue stream because they are, in part, generators of said stream is not really a subsidy. It's more like a revenue co-op between the city and the team(s).

 

[MAROONSRoad]

How the confidential info became public:

Glendale and the NHL are desperately trying to salvage an offer for the Phoenix Coyotes that was put in jeopardy after confidential Bankruptcy Court files were leaked that showed the bidder wanted guarantees of millions of dollars from the city and an escape clause to move the team...

The confidential information was posted publicly through the court's Web site by attorneys for current Coyotes owner Jerry Moyes...

Almost immediately, Reinsdorf's attorneys expressed "complete disbelief that such confidential information was released" and "threatened to walk away from the bidding process"...

A spokesman for Moyes, Steve Roman, told The Republic on Monday that the leak was "completely inadvertent and accidental."

"There was no funny business," he said.

Moyes' attorneys had indicated to Glendale before filing that they planned to submit the documents to the judge under seal.

Link:

http://www.azcentral.com/news/articles/2009/08/04/20090804coyotes0804.html

GHOST

 

[XX]

"completely inadvertent and accidental."

Which is why the summary file that had all the basic info on the concessions stayed up most of the day? Riiiiiight.

Contempt.

 

[Artyukhin*]

How the confidential info became public:



Link:

http://www.azcentral.com/news/articles/2009/08/04/20090804coyotes0804.html

GHOST

good to see regardless. I mean seriously when do you say it doesnt work ?they have lost 300 million over the last 14 years and still need 23 million a year from the govt/taxpayers to survive???...the People of Phx need to think real hard if they wanna keep throwing money down the hole and all this comes with an "outclause" after 5 years..so much for the iron clad lease huh?


Jerry Reinsdorf is saying what Jerry Moyes already has said ..Nhl hockey in Phx doesnt work never will...

Jerry Reinsdorf wants a subsidy to stay for 5 years to break the lease and sell the team .............................Jerry Moyes wants to do it now ..

Jerry Reinsdorf, owner of the Chicago White Sox and Chicago Bulls, says the hockey team won't survive unless the group gets up to $23 million a year in revenue from the Coyotes' arena lease with the City of Glendale, according to new court filings.



• The taxing district would yield an estimated $23 million in payments the first year, and $15 million by the fifth year, in 2014. The court filing says those payments could continue after 2014.

• If the team was losing money after five years, the Reinsdorf group could demand an additional $15 million a year from the city.

• If the city refused, the Reinsdorf group could sell the Coyoyes and move them, without paying a penalty.

http://www.azcentral.com/12news/news/articles/2009/08/03/20090803cardsvscoyotes08032009-CR.html

 

[Artyukhin*]

the irony ....

Outside the court, Daly expressed concern about Reinsdorf's bid.

"At some point, we're concerned that he may just reach a decision that it's not worth all the time and money and effort when he's getting resisted as strongly as he is by Mr. Moyes and Mr. Balsillie," Daly said.

http://www.thestar.com/Sports/article/675723

 

[HockeyAnalysis]

the irony ....



Outside the court, Daly expressed concern about Reinsdorf's bid.

"At some point, we're concerned that he may just reach a decision that it's not worth all the time and money and effort when he's getting resisted as strongly as he is by Mr. Moyes and Mr. Balsillie," Daly said.



http://www.thestar.com/Sports/article/675723

Someone should tell Reinsdorf that if he can't handle a little competition, professional sports (let alone business) might not be for him.