*This article was updated 3/5/11
Months ago, we pronounced this thing over. Speaking with a high-ranking Coyotes executive about how things would be different under new ownership, he seemed optimistic. The executive talked about having less financial strains on things not just player related like marketing and sales. “Whew, it’s over,” was his general sentiment.
Eggs counted, now for them to hatch…..
The Goldwater Institute has battled against deals to sell the Coyotes from the beginning. They were either right to question the Jerry Reinsdorf situation or ran him out of town. It seemed GWI was protecting the people of the City of Glendale. Lucky for the ‘Yotes, another buyer for the NHL-run franchise named Matthew Hulsizer dropped out of the sky with a cape on and offered to save the team.
The deal Hulsizer and the city agreed to sounds a little like something Henry Potter concocted. The city agrees to sell bonds as part of a $197 million plan to help Hulsizer buy the team for between $160 and $170 million. Glendale would pay $100 million to their new owner for the rights to parking revenue and pay him $97 million more to run Jobing.com arena. In turn, Hulsizer would pay off the NHL and the team’s debt to the league.
“An investment….not a gift”
While it’s a risk, if the deal doesn’t go through, ESPN.com said this week, the city will lose its team and more than $500 million. Enter: Goldwater Institute. The Phoenix Business Journal wrote Friday that Goldwater is threatening a lawsuit if Glendale tries to sell bonds. CEO Darcy Olsen, the Journal said, claims the city already owns the parking rights and should not have to buy them for $100 million. The city says that’s incorrect, but Olsen contends Hulsizer should borrow the money to buy the Coyotes, not be given it by the city.
Your move, commish
The Phoenix Coyotes were supposed to have a buyer by Jan 1. Three months later, things are log jammed due to Goldwater’s insistence that the city is getting a bad deal. Bonds cannot be sold until things are cleared up. Since Goldwater seems unrelenting, it becomes NHL commissioner Gary Bettman’s move. The commissioner has not set a timetable for Glendale to work out its deal for the Coyotes, but he may have to soon. The team loses around $20 million per year and the NHL is footing the bill – all while folks in Winnipeg patiently wait in hopes to get their team back.
While ESPN.com’s Scott Burnside questioned the motives of Goldwater. It appears the city is either guaranteed to lose millions or just likely to lose millions. Bettman has poured his soul into trying to keep this team in Phoenix, but how long can the NHL wait? Certainly not long enough to take another $20 million in debt.
ESPN's Burnside is reporting Glendale will sue Goldwater Institute alleging the firm interfered with the team's sale by reaching out to potential bond buyers warning them not to purchase the municipal bonds. The NHL hired a former Reinsdorf associate to work with Goldwater to work out the two sides' differences. However, Burnside said, the NHL has reached its breaking point and may have to move quickly if the differences are not resolved.
Matthew Coller is a staff member of the Business of Sports Network, and is a freelance writer. He can be followed on Twitter
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