Matthew Hulsizer is taking a serious look at buying the St. Louis Blues.
The Chicago businessman, who withdrew his offer to buy the Phoenix Coyotes last month when he tired of dealing with the political leaders in suburban Glendale, recently toured the Scottrade Center in St. Louis with Blues chairman and minority owner Dave Checketts.
A source familiar with the Blues situation said Hulsizer is discussing a price in the range of $165-million to $170-million (all currency U.S.) with Checketts. The Blues chairman said earlier this week he was given an extension on a $120-million loan with Citigroup Inc., that would give him more time to sell the team.
Checketts and his company, SCP Worldwide, took out the loan in 2006 when he bought the Blues along with TowerBrook Capital Partners, a private equity firm, from Bill and Nancy Laurie for $150-million.
TowerBrook holds a 70-per-cent interest in the team and announced in May, 2010 it wanted to sell its share. Equity funds generally look to sell investments after five years and move on, and the Blues did not prove to be a profitable investment thanks to the performance of the team and the onset of the recession a few years ago.
Checketts has not been able to find an investor to replace TowerBrook and said last March the entire team was now for sale. He received an offer from fellow minority owner Tom Stillman, which was rejected by the NHL.
Earlier this week, Checketts told the St. Louis Post-Dispatch there were three "very strong" bidders for the team. Stillman is one and Hulsizer is another and the source familiar with the Blues sale said it is not known who the third group is. The banking source was skeptical that the third group is seriously interested.
The Blues' financial situation is not in ideal condition, the banking source said, meaning Hulsizer is in position to drive a hard bargain. Checketts has actually been looking for investors without success for more than two years, the banking source said. At the same time, the banking source said Citigroup has been trying to sell the Blues loan to other financial institutions at a discount but has not found any takers.
While Hulsizer is discussing a price greater than the Blues loan, recent sales of NHL franchises have seen the actual cash handed over is around $100-million or less.
A sale to Hulsizer does not mean Checketts is out as a Blues owner. While Hulsizer wants to be the majority owner, he is interested in keeping Checketts as a partner.
Checketts could not be immediately reached for comment.