Glendale Approves Additional $25M To Keep Coyotes For Another Season
The Glendale City Council agreed 5-2 yesterday to pay the NHL "up to an additional $25 million so the Phoenix Coyotes could stay another year in the desert," according to Rebekah Sanders of the ARIZONA REPUBLIC. The pledge "allows Glendale to continue work on an arena lease" with prospective team owner Matthew Hulsizer through the '11-12 season. Glendale in return "agrees to cover team and arena losses for a second season of up to $25 million, until a team buyer takes over." Glendale "made a similar bargain a year ago." The city paid $25M to the NHL this month to "fulfill the pledge it made last year to keep the Coyotes through the recently ended season." One "difference in the current agreement: the NHL obtains the right to renew the agreement yearly for 10 years" (ARIZONA REPUBLIC, 5/11). Glendale Mayor Elaine Scruggs emphasized, "This is a payment for a service. This is not a subsidy. ... We are keeping our community arena open for business. We are keeping that arena generating revenue." NHL Deputy Commissioner Bill Daly before last night's vote told the council that the league "remains committed to keeping the team in Arizona." He said that he "hadn't anticipated being back for another $25 million, that the league thought it had a buyer" in Hulsizer, but he "indicated the league could seek another buyer." Daly said, "We're much closer to the finish line. I think we are getting there whether it is with Mr. Hulsizer or another potential buyer" (AP, 5/11).
LEGAL MANEUVERING: The AP's Bob Baum reports the NHL is "considering a legal move to clear the way for the sale" of the Coyotes to Hulsizer. Daly after last night's vote said, "We really need to step back and look at next steps. And maybe it is to clarify the legal position and move forward with that structure. That might clear a lot of things up. Maybe it's restructuring (the Hulsizer deal). Maybe it's a new investor with a new deal. Those are all possibilities and (Tuesday's) resolution will give us an opportunity to explore those." He added that there is "no deadline but hoped a sale could be completed by the end of the summer" (AP, 5/11). Glendale "continues to court" Bulls and White Sox Chair Jerry Reinsdorf to buy the Coyotes "even as it tries to finalize a sale of the team" to Hulsizer (BIZJOURNALS.com, 5/11).
GETTING OFF THE ICE: The ARIZONA REPUBLIC's Sanders reports minority-investor group Ice Edge Holdings "has withdrawn from the group led" by Hulsizer that is attempting to buy the Coyotes. The "tipping point was learning Friday about the council vote." The "next day, Ice Edge notified Hulsizer that it was pulling out of the ownership group." Ice Edge CEO Anthony LeBlanc: "It was purely a decision based on the fact we have been involved with this for two years. We just didn't feel comfortable spending any additional time on it." Brad Goldberg, a spokesperson for the Hulsizer group, said that Ice Edge's departure "would not hurt the deal with Glendale." LeBlanc said that "other minority investors are still involved, and Hulsizer would be able to replace Ice Edge's financial contribution." He declined to be specific but said it was "a small amount" (ARIZONA REPUBLIC, 5/11). LeBlanc said that his company will "concentrate on its minor league hockey operations" in Thunder Bay, Ontario. He added that he "plans to run for political office there" (TORONTO STAR, 5/11).