The Twits and the Phoenix Coyotes

I don't know how many of you are still following the Phoenix Coyotes saga, but just when things appear to be settled or calmed down, something really stupid happens and things are once again thrown into turmoil. Like Phoenix's white night, Jerry Reinsdorf, pulling his bid off of the table and dropping his quest to save the Coyotes for Phoenix.

But don't worry. The NHL has found a new owner. The NHL. That's right. The NHL is making a bid to purchase the team from bankruptcy, and get this, its offer is for even less money than what Reinsdorf was offering up. And from I've read, the NHL's plan is to purchase the team and then sell it to whoever will offer up cash for it -- and the team doesn't even have to stay in Phoenix.

And coming up next week, the Judge is supposed to decide if he will allow Jim Balsillie to bid on the team, or whether the NHL's vote finding him "not qualified" to be an owner will keep him from bidding on the team.

I no longer have any idea of what is going to happen here. But I'm pretty sure, after everything that's happened, that the NHL is being run by this group of twits.

Coyote Creditors Now Support Reinsdorf Bid

Last week, after the largest creditor of the Phoenix Coyotes backed Jim Balsillie's bid for the team as the only one that they would accept, I thought for sure the Coyotes would be no longer for Phoenix after this season. But today, that same creditor announced that it has reached a deal with Jerry Reinsdorf, so they are now willing to accept Reinsdorf should his bid be chosen by the judge -- I still don't understand this in that it still does not appear that Reinsdorf is parting with any cash, but if the creditor's happy, then the judge should be happy. (There's no word on how all of the creditors feel about this, but the Court cares more about the big guys than it does the little guys.)

Frankly, I now think this dooms Balsillie's bid. Sorry Canadians, but it's looking like a city that doesn't really seem to want the team is going to continue to have a team while a country that loves hockey continues to have an under-served market.

It still appears, however, that Reinsdorf has to work out a deal with Glendale over the use of the arena. And the auction for September 10 is open to any and all bidders, so it's still possible that another bidder could swoop in and making an even better bid which the judge would accept. I still think, from what I've read of Reinsdorf's bid, that the Coyotes are doomed to failure to Phoenix, but instead of ending it, the NHL is just going to stretch things out because of Bettman's hatred of Balsillie, and I'm surprised that Reinsdorf is willing to go along with this -- oh, wait, no I'm not as there appears to be a rather crooked political deal going on involving Reinsdorf.

[Addendum] The Phoenix Coyotes Are Dead, Almost, Just Give It A Minute

Ding dong. The witch is dead. Maybe. Almost. We'll know more next month. But in a ruling that perhaps surprised only the NHL, the Phoenix bankruptcy judge overhearing the Phoenix Coyotes bankruptcy today announced that the Jerry Reinsdorf no-money bid, the mythical-yet-to-be-submitted bid from Ice Edge Holdings, and the $212.5 million bid of Jim Balsillie will all be considered by the bankruptcy court in an auction on September 10.

Originally, there were to be two auctions regarding the Coyotes -- a keep the team in Phoenix auction which was supposed to have been done today, and the September 10 open to relocation auction if the original auction was deemed to be unsatisfactory. But Jerry Reinsdorf's bid has proven to be a bit inadequate, and he's still attempting to negotiate with the city of Glendale, AZ over the use of the Coyotes arena, so he and the NHL requested a delay so as to work on the bid. The judge granted that delay, with the result being that all bids will be considered on the same day.

This is bad news for Phoenix, Reinsdorf, and the NHL seeing as how the judge and the leading creditor have both stated that they prefer Balsillie's bid, seeing as how actual money is involved and the creditors are paid off. But in even worse news for Phoenix, Reinsdorf, and the NHL, the judge also stated that the auction is "open to any and all bidders including, but not limited to P.S.E. [Balsillie]."

What that, in effect, means is that the everybody is welcome to bid on the team, and there has been speculation that once the team was open to relocation more bidders might leap in. So it's possible, seeing that this team can now be moved and is not stuck with having to stay in Phoenix, that other parties are going to submit bids to purchase the team and move it, and the NHL has virtually no way to prevent this unless they find a way to get Reinsdorf to offer up at least as much cash as Balsillie.

There is also going to be a court hearing next Tuesday so as to address the fact that the NHL last week rejected Balsillie's bid. My thinking is that the judge will hear the NHL out, tell them to shut up, and get on with the real work. Considering some of the owners they have let into the league, like "Boots" Del Biaggio for example -- it's funny to listen to Minnesota Wild owner Craig Leipold go on about Balsillie being a liar when you consider that Leipold thought Del Biaggio was an honest guy -- I don't think the judge is going to be too sympathetic to the NHL's concerns. Especially since the judge's concern is getting the money back to the creditors, not helping Gary Bettman dig himself out of this grave he's buried himself in.

So the future of the Coyotes in Phoenix is dead. Almost. Not quite. But in a minute. They'll be stone dead soon. It won't be long.



ADDENDUM:

I want to be clearer about something: with the bidding process thrown open to anybody who wants to buy the club and move it, I wouldn't be shocked or surprised if someone makes a bid that surpasses that of Balsillie's and ends up with the team.

Disorder In The Court: The Phoenix Coyotes Drag On And On

For those of you still attempting to follow along, the idiocy continued in Phoenix today as once again, the bankruptcy judge refused to bring things to an end. Of course, there are a couple of good reasons the bankruptcy judge didn't bring things to an end, first and foremost being that the idiots running the NHL couldn't get a decent bid from the savior that is supposed to be Jerry Reinsdorf, and Reinsdorf and the other so-called bidder seeking to keep the team in Phoenix begged for a delay in the auction so as to have more time to negotiate with the creditors -- primarily the city of Glendale.

Another reason that the judge couldn't end things today is that there's only one legitimate bid, and that's Jim Balsillie's bid to move the team to Hamilton, but that portion of the auction is scheduled for next month. The judge declared Balsillie's bid to be the "highest and best" of the offers, and it's actually the only one in which creditors will get money.

That's probably why the largest creditor of the Coyotes, SOF Investments, a fund owned by Michael Dell of Dell Computers, appeared in court and said it was only interested in being paid in full and in cash and requested that the court reject the other bids. That should end up having a big influence on the court because the role of the bankruptcy court is to make sure that the creditors get their money back -- and when the largest creditor is happy with only one bid, then that's probably the bid the judge will end up backing.

The matter as to Reinsdorf is now being postponed until September 10 to give Reinsdorf and the mythical bid (mythical because a bid has yet to actually be made) time to get their act together and get not only concessions from the city of Glendale, but also to find a way to make creditors like SOF Investments happy. (There will be a hearing on Wednesday as to whether the relocation auction will be still be held on September 10.)

There are major problems arising with Glendale, and Coyotes owner Jerry Moyes revealed these problems in court filings last Friday. Primarily, Reinsdorf is trying to get a $23 million subsidy from the city over the use of the arena, and that subsidy would be raised by creating a special district around the arena which would charge a so-called voluntary surcharge on retail sales in the district which includes a large mall. More importantly, the district also includes the stadium used by the Arizona Cardinals, and the Cardinals have made it known that they're not happy about this: "The NFL team’s stadium would be in the special district and team president Michael Bidwell was quoted in local media reports as saying it was not fair that Cardinal fans should have to pay for the Coyotes’ problems."

And it gets better, if Glendale couldn't raise the necessary money through the surcharge, the city would end up paying the Coyotes out of city funds, and if, within five years, the team was still not showing a profit and if the city then refused to pay the team $15 million a year, then Reinsdorf would be able to move the team.

And if you have the time, there's a good story from a sister paper to the mothership which reports that there are some very serious shenanigans on the part of Glendale's city manager to make sure a good friend of his (a co-bidder from Reinsdorf) gets the team, and that this city manager has failed to offer up similar deals and concessions to the current owner and any others who might have been interested in the team.

So, in summary, there will be a hearing on Wednesday to determine if the relocation auction originally scheduled for September 10 will still take place on September 10, or whether it will be pushed back so that the incompetent fools chosen by the NHL can attempt to get their act together in time for another auction on keeping the team in Phoenix on September 10. Further, the judge likes the Balsillie bid. The largest creditor likes the Balsillie bid and has stated it wants to be paid in full and in cash. There's some shady business dealings going on between the city of Glendale and Jerry Reinsdorf, and even the Arizona Cardinals are against the Coyotes.

At this point, I think we should all be happy that George W. Bush put Mike Brown in charge of FEMA and not Gary Bettman because I can't help getting the feeling that the Gulf Coast would still be under water from Katrina if Bettman was running things.

P.S.: For a little fun, here's some real disorder in the court.

NHL May Accept Reinsdorf, But That Means Nothing To The Court

For those of you wondering about what the NHL's action of approving Jerry Reinsdorf's bid to purchase the Phoenix Coyotes means, I provide as a simple an answer as possible: NOTHING.

The NHL has no say in this matter anymore. It's all up to the bankruptcy judge. And if the bankruptcy judge doesn't like Reinsdorf's bid, then it doesn't matter a bit what the NHL wants. The judge will consider the bids next week. There is, technically, only one bid for the judge to consider, and that's Reinsdorf's bid which doesn't even involve any money -- it's just Reinsdorf assuming the debts and promising to pay back the creditors at some point. The so-called second bid from another Canadian group was nothing more than a letter of intent to make a financial bid at an unspecified time in the future. The Court was quite clear that the it wanted bids, but it's possible that the judge will also consider this as a bid and take this into account at the auction next week.

It's quite possible -- I really wouldn't rule it out because there's never no telling what will happen in bankruptcy court -- that next week the judge will accept Reinsdorf's bid. But he will accept or reject the bid on the basis of what's actually included in the bid, not on the basis of what the NHL decided on yesterday. The judge has already indicated in the past that he thinks the NHL is full of it, so it's quite possible the NHL decision could harm the chances of the team staying in Phoenix past this upcoming season.

Like I said, it's possible the judge will rule in the NHL's favor and give the team to Jerry Reinsdorf. Personally, I doubt it as bankruptcy judges don't like being bossed around by parties that have no role in the proceedings. But we're not going to no until next week.

An Update on the Phoenix Coyotes Situation

Toward the end of last season, I spent a lot of time on the Phoenix Coyotes bankruptcy situation. Things have been kind of quiet recently as the bankruptcy proceedings have been ongoing. Well yesterday was the deadline for prospective owners to submit bids for the franchise to the Phoenix bankruptcy judge. These are the bids that would go to keeping the club based in the Phoenix suburb of Glendale, and the auction is set for August 5th.

Only one bid was submitted for the franchise. Jerry Reinsdorf, as expected, submitted the only legitimate bid. But the seriousness of this bid is somewhat questionable to me. The bid is only for about $148 million. There will be no cash exchanged, and will consist of Reinsdorf assuming the team's debts. The deal is also contingent upon Reinsdorf achieving huge concessions from the city of Glendale regarding the use of Jobing.com Arena in Glendale, and it is also contingent upon concessions from the creditors. Also, Jerry Moyes, the current owner of the team, would not receive much from Reinsdorf.

I've been surprised by the judge's actions in this case in the past, but I just can't see the judge accepting this bid, not when Jim Balsillie has already offered up $215.5 million in a bid that would actually provide the creditors with real funds and not require any concessions on their part. I know if I were a creditor I would want the real cash, not some other sucker coming in and taking over the debts with the pledge to pay them off later. And under the Balsillie bid, Moyes would actually receive money for his share of the franchise.

I know the NHL thinks it's above the rules, but the role of the bankruptcy judge is to set whole the creditors, not to make the NHL happy. And you would think that the NHL would have done everything possible to make sure an actual bid with actual money was offered. This just serves to prove Moyes contention back when he filed for bankruptcy that he couldn't find any buyers fo for the team so he was left with no choice but to go into bankruptcy and accept Balsillie's bid.

If the judge doesn't accept this bid, new bids will be accepted from people seeking to move the team out of Phoenix, including Balsillie. And that auction would be held in September. So no matter what, I think the Coyotes will be playing in Phoenix this season.

Along with the Reinsdorf bid, a letter of intent was filed which stated that a real bid would be following at a later date. I honestly don't see the judge accepting this because it's not an actual bid, and the rules set forth by the judge were rather clear and easy to understand.