Billionaire considering deal with Devils
Billionaire investor, hockey enthusiast and Wendy's owner Nelson Peltz is weighing a plan to buy the New Jersey Devils' $250 million debt, a source close to the situation told the New York Post Tuesday.
The plan being discussed by Peltz, whose Triarc Companies owns the fast-food chain, includes lining up an equity investor to buy the money-losing NHL team should the current owners fail to restructure the debt, according to one person who has spoken with Peltz in recent weeks.
Peltz, who was said to be interested in buying the New York Islanders last December, is seeking a partner to provide roughly $50 million in equity in a purchase of the team in a prepackaged bankruptcy.
The Devils missed an Oct. 17 deadline to make a roughly $80 million principal payment. But lenders did not put the team in default and extended the deadline in an effort to reach a restructuring deal with controlling owner Jeffrey Vanderbeek.
Vanderbeek is working with Goldman Sachs on an ambitious plan to securitize the team's TV rights deal. If successful, the securitization will generate roughly $80 million -- enough, it is believed, to pay lenders and get the debt restructured.
Goldman has told the lending group the securitization is on track and should be done in mid- to late-January.
If Vanderbeek succeeds, it could put the Peltz plan on ice.
However, while the lending group is working with the Devils to restructure its loans, one lender told the Post he would jump at an offer of $200 million.
The Devils, and its Devils Arena Entertainment unit, which collects proceeds from events at Newark's Prudential Center arena, is losing about $15 million a year, sources said.
Devils co-owner Ray Chambers has agreed to — but not closed on — a deal to pay $24 million to unload his 47 percent stake in the team to Vanderbeek as part of an agreement to refinance the franchise's debt.
The source close to the situation said the NHL has given tacit approval to Peltz's plan, if he pulls it off. A source close to the league said it is not working with Peltz.
In recent months, NHL Commissioner Gary Bettman has taken different stances with those buying debt from financially troubled teams.
The NHL succeeded in stopping a debt investor from taking control of the Phoenix Coyotes. After that, Bettman allowed Vancouver businessmen Tom Gaglardi to buy the debt of the bankrupt Dallas Stars.