Jerry Moyes, who filed for Chapter 11 bankruptcy protection for the Phoenix Coyotes in early May, has agreed to sell the club to the NHL. The deal still has to be approved by Judge Redfield T. Baum, who is overseeing the bankruptcy procedure.
The deal was reached in Baum’s courtroom as a hearing was taking place, updating the court on the on-going process of selling the club to pay secured creditors. Last month, Baum rejected both the NHL’s and Blackberry co-CEO Jim Balsillie’s bids. His ruling knocked down Balsillie’s bid completely, and said that the NHL’s bid did not satisfy all creditors, namely Moyes and minority owner and former coach Wayne Gretzky.
As reported by the AZ Republic, the agreed to sale comes after the Balsillie bid was rejected in total.
"Once that bid was rejected, this (the NHL's) bid became the new reality," said Steve Roman, a spokesman for Moyes.
Under the NHL offer, the league would use as much as $11.5 million to purchase 100 percent of the claims of contractors at Jobing.com Arena, as well as to pay debts owed to Glendale, which built the hockey arena.
The remaining $128.5 million would go into the Coyotes estate, paying $79.7 million to SOF Investment, the largest secured creditor, and about $37 million to the league to repay its temporary financing of the team since last fall.
Once attorneys' and administrative fees are paid, it's likely less than $10 million would be available to pay the two remaining creditors: Moyes, whose claim sits at $104 million, and Gretzky, whose claim attorneys pegged at $9.3 million.
A big reason for Moyes agreeing to the sale comes from the flood of red ink he is paying out to meet payroll and other expenses with the Coyotes. A $2.6 million payment is due this week.
As for Gretzky, it appears he is not happy with the proposed sale by Moyes. The “Great One” has a $22.5 million claim in the case, and has not approved of the transaction. As TSN Insider Darren Dreger said via Twiiter, “Wayne Gretzky is not happy with the sale of the Coyotes to the NHL. His interests in the team have not been addressed.”
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Maury Brown is the Founder and President of the Business of Sports Network, which includes The Biz of Baseball, The Biz of Football, The Biz of Basketball and The Biz of Hockey. He is available as a freelance writer. Brown's full bio is here. He looks forward to your comments via email and can be contacted through the Business of Sports Network.
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