The NHL is praising the lease agreement between Chicago investor Matthew Hulsizer and the city of Glendale, saying it will ”finally lead to a transition of ownership of the Phoenix Coyotes.”
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The city announced Friday that it had reached an agreement in principle with Hulsizer on a new lease for the team to play in the Jobing.com Arena.
”It has always been the league’s objective to secure ownership that will ensure the Coyotes’ long-term future in Glendale,” NHL Deputy Commissioner Bill Daly said in a statement issued by the league. ”And consummation of the proposed transaction will achieve that.”
The league bought the team out of bankruptcy more than a year ago and has said all along that a new lease was essential if the team were to stay in Arizona.
”We are very pleased that the parties appear to have reached an agreement that will finally lead to a transition of ownership of the Phoenix Coyotes,” Daly said. ”… We look forward to working closely with the Hulsizer group and moving quickly toward the conclusion of this process.”
Hulsizer was en route to Arizona, where the Coyotes play their home opener on Saturday night against the Detroit Red Wings. His spokesman, Judson Just, said Hulsizer ”looking forward to seeing a great game tonight,” but had no further comment beyond what the league and city had said.
The city announced the breakthrough in a brief statement on its website:
”The City and the Hulsizer group have an agreement in principle on a lease which would allow the Hulsizer group to buy the team from the National Hockey League (NHL) under the terms they requested. The proposed ownership transaction is subject to formal approval by the NHL Board of Governors.”
Hulsizer is co-founder and chief executive officer of PEAK6 Investments. The Ice Edge group remains a part of Hulsizer’s efforts to buy the team.
Hulsizer emerged recently as the money man in the efforts to purchase the team by Ice Edge. The NHL and Glendale were concerned about the Ice Edge offer because it relied heavily on bank financing. Hulsizer came in and would be the majority owner if the purchase goes through.
The 1991 Amherst graduate was a director and risk manager for Swiss Bank from 1994 until he co-founded PEAK6 in 1997. Before that, he was a senior trader with O’Connor & Associates, a proprietary derivatives firm that was acquired by Swiss Bank.
The front page of the PEAK6 website says the company’s success is built on ”relentless innovation, flawless execution, and fierce entrepreneurialism.”
The Coyotes’ ownership saga began in May 2009 when then-owner Jerry Moyes took the team into bankruptcy, to the surprise of the NHL. Moyes planned to sell the team to Canadian billionaire Jim Balsillie – founder of the company that makes the Blackberry. Balsillie had failed in earlier efforts to buy the Pittsburgh and Nashville franchises.
Balsillie’s purchase was contingent on moving the franchise to Hamilton, Ontario, a move strongly opposed by the NHL. The sides waged a prolonged court battle through the triple-digit heat in the 2009 summer. Last September, the bankruptcy judge rejected Balsillie’s bid, leaving the NHL as the only bidder.
The league purchased the franchise with the stated intention of finding a buyer to keep the Coyotes in Arizona. But if that doesn’t happen by the end of this year, the NHL said it would look for buyers elsewhere.
Glendale has deposited $25 million to cover losses for the franchise this season. Hulsizer’s group also deposited $25 million in what was described as a demonstration of good faith.
The Coyotes never have turned a profit since moving from Winnipeg in 1996.
Despite the uncertain ownership status and a low payroll, the Coyotes had a surprisingly successful 2009-10 season, winning 50 games, third-most in the West. The team went from playing in an almost empty arena early to a string of eight sellouts at the end of the season before losing to Detroit in seven games in the first round of the playoffs.