Sale Of Lightning Falls Through Due To Investor Infighting

Investor Infighting Dooms Absolute Hockey Enterprises' Bid To Purchase Lightning

Palace Sports & Entertainment (PSE) on November 14 terminated a $200M purchase agreement for the Lightning with Absolute Hockey Enterprises, after a “rift among the buyers left them unable to make a $5[M] payment due Palace Sports” by November 12, according to Thorner & Cristodero of the ST. PETERSBURG TIMES. Absolute Hockey investors Jeff Sherrin and Doug MacLean -- formerly President & GM of the Blue Jackets -- have sued movie producer Oren Koules, claiming that Koules "not only defaulted on a $4.17[M] payment [part of the $5M due on November 12] but that he also went behind their backs to make his own arrangements with the Lightning.” Sherrin and MacLean are seeking “at least $50[M] in damages from Koules, whom they blame for the deal’s collapse.”  Sherrin and MacLean’s attorney, Tom Scarritt, said, “Koules decided he wanted a much higher percent of the profits and ownership, and he was willing to shoulder a greater financial burden. So the partners decided to rewrite the contract to allow that to happen. He made a partial payment of $5[M], but within the last two or three weeks, all of a sudden we get totally different behavior out of him.” Koules could not be reached for comment. PSE said in a statement, “While there is no current agreement in place to sell the team, PS&E is hopeful that those differences can still be resolved and a successful ownership transfer can take place” (ST. PETERSBURG TIMES, 11/27). Read the lawsuit. To read the lawsuit, visit SportsBusinessDaily.com.

SUPER BAD: In St. Petersburg, Gary Shelton writes with the deal falling apart, “Everyone loses. A sale does not implode this loudly without all parties getting some of the mess on their shoes. MacLean? Even if he could regather his forces, who is going to believe him now?” It is “easy to speculate that Koules resented paying most of the money while others made most of the decisions. … But Koules knew the deal when he signed it. And for a prospective owner, trust is a vital issue. For Koules, that’s going to be a tough sale.” Shelton adds, "Wasn’t this [PSE Owner Bill Davidson’s] hand-picked group?” (ST. PETERSBURG TIMES, 11/27).