Tuesday, March 8, 2011
Why the Phoenix Coyotes won't die
A last-ditch plan could be in the works to salvage the sale of the Phoenix Coyotes to prospective buyer Matthew Hulsizer. If that plan fails, the hockey franchise could then be sold to a Canadian group who will move the Coyotes back to Winnipeg. Gary Bettman tried to arrange a meeting the Goldwater Institute but was unsuccessful.
So why won't this thing die? Well for one thing the NHL is attempting to negotiate a TV contract with NBC. Phoenix is the 12th largest market in the U.S. and as it is the NHL doesn't have a team in 2 of the top 20 TV markets. Adding another to the list isn't going to assist in those negotiations.
Matthew Hulsizer has suggested he loves the Phoenix area and is committed to making this work. He indicated that he has been approached by several other NHL franchises eager to sell and turned them down because he wants the Coyotes. And he Coyotes need a committed and stable owner.
I think the NHL actually feels bad for the City of Glendale which has put up a lot of money to support this franchise. The NHL would therefore like to go to the wall to make this sale happen. That is why no deadline has been give to complete the deal.
That being said there are a few possible scenarios:
• Reducing the amount of City of Glendale bonds for Hulsizer and the Coyotes from $100 million down to $70 million. That might still not satisfy Goldwater.
• Having the NHL discount its estimated $170 million asking price for the team, plus this year’s $25 million to $30 million in losses it wants covered by Glendale or Hulsizer. I can't see that happening because the other owners never agreed that they would lose money over the Coyotes. In fact they have been promised it would cost them nothing if they cooperated.
• Asking Hulsizer to contribute more than the current estimated $70 million he is putting into the transaction. He might if he can get some other concessions from the league.
• Possibly leveraging $25 million Glendale previously allocated to help cover the Coyotes losses this season.
• Hoping the reduced bonds amount and financial changes lessen legal opposition to the deal from the Goldwater Institute watchdog group. It doesn't sound like they will back off but you never know.