A group of Canadian and U.S. businessmen have withdrawn their bid for the Phoenix Coyotes, after billionaire Jim Balsillie sweetened his own offer for the team.
Balsillie, co-chief of BlackBerry maker Research in Motion Ltd., and the National Hockey League are now the only two parties still trying to buy the Coyotes.
Ice Edge Holdings had offered $150 million for the NHL team. The bid was contingent, however, on the Coyotes reaching a new lease agreement with Glendale, Ariz.
The city spent $183 million to build the Jobing.com Arena, which opened during the 2003-2004 NHL season.
On the weekend, Balsillie upped the value of his bid for the club to a possible top-end value of US$242.5 million -- a figure that includes the price of the team purchase, as well as compensation for the city of Glendale, should he be successful in relocating the team to Hamilton, Ont.
By comparison, the NHL is only offering $140 million to purchase the Coyotes, with a plan to keep it playing in the desert state for the time being.
Previously, Balsillie's bid stood at $212.5 million. He increased the value of his bid by $30 million in a U.S. bankruptcy court on Monday night.
According to his court filings, Balsillie's legal team acknowledges that Glendale would suffer "significant damages" if the NHL franchise is moved more than 3,500 kilometres away to Southwestern Ontario. But the lawyers argue that the Phoenix suburb will still be better off with what it receives from Balsillie's offer as compared to the one from the NHL.
With the amended version of his bid, Glendale would receive between $40 million and $50 million more than Balsillie had been offering under the previous version of the bid. The exact amount of money paid out to the city would depend on the relocation fees Balsillie will have to pay to the NHL if his bid is successful.
The deal is contingent, however, on the Coyotes being allowed to play in the Jobing.com Arena "briefly while relocation is implemented" -- likely a nod to the fact that it will be impossible to move the team to Hamilton for the Oct. 2 start of the NHL season. It also has to be accepted by Sept. 21 and must close within 11 days.
Redfield T. Baum, the judge tasked with overseeing the auction process in bankruptcy court, has still not ruled on whether Balsillie can bid on the team, or move the team to Canada.
Howard Bloom, the publisher of SportsBusinessNews.com, believes it will be difficult for the judge to reject Balsillie's latest bid because of the benefits it will bring for the team's current home city.
"At the end of the day, Judge Baum has the fiduciary responsibility to do what is in the best interest of the creditors," he told CTV News Channel during an interview from Ottawa on Tuesday morning.
"And I don't think in their wildest imaginations, their greatest fantasies...did the city of Glendale ever figure that they were going to get $50 million."
But Balsillie has been overwhelmingly rejected by the NHL's Board of Governors as a potential owner.
The NHL club was placed in Chapter 11 bankruptcy protection in May, and Balsillie has been clamouring for control of the team ever since.
With files from The Canadian Press
