Greg Jamison has missed his deadline to buy the Phoenix Coyotes before a lease agreement with the City of Glendale, Ariz., expires.
The former CEO of the San Jose Sharks had until midnight Thursday Pacific time to buy the team from the NHL for $170-million (all currency U.S.) under the terms of the lease agreement with Glendale, but was unable to get the money or investors he needed in time to hit the deadline.
“We will not be able to complete our purchase of the Phoenix Coyotes today in time to meet our deadline with the city of Glendale,” Jamison said in a statement. “However, our journey to purchase the Coyotes will continue. We realize this will require additional conversations with the City of Glendale and the NHL. We still believe we can reach an agreement that satisfies everyone. We hope negotiations with the city proceed as smoothly as possible, as everyone involved wants the Coyotes to remain in Arizona.”
Jamison had emerged as the latest and arguably best chance for the Coyotes to land an owner after more than three years of being run by the league. He reached a 20-year, $308-million lease agreement with Glendale for Jobing.com Arena in the fall, creating what was believed to be a clear path to ending the Coyotes' up-and-down ownership saga.
Instead, the uncertainty with the franchise will continue with still no end in sight.
“To the Arizona's sports and hockey fans, and the City of Glendale, we appreciate your patience and diligence,” Jamison said. “We wish everything was completed today as we worked extremely hard on the deal. However, we have taken significant steps to keep the Coyotes in Glendale for the long-term. I've seen first-hand the wonderful support Arizona hockey fans have provided the Coyotes and we will continue our efforts to keep the NHL in Arizona.”
Glendale spokeswoman Julie Frisoni said the city will have a statement on Jamison missing the deadline on Friday, after the NHL issues one of its own.
Glendale mayor Jerry Weiers had already turned down a request by Jamison's group to extend the deadline and said that once the lease agreement expired, Glendale council would not grant a similar one to Jamison or any new buyer.
The agreement came under fire from Weiers and other councillors because it calls for payments to Jamison and the Coyotes of an average of $15-million a year for 20 years. Weiers and three other council members were elected last November and the city is no longer willing to slash costs in other areas, such as laying off police officers and firefighters, to keep the Coyotes from moving.
“I can guarantee you there is not the same will on council to do the same deal with anyone else,” Weiers said.
With both the NHL and the city intractable on their terms, there is little chance a new buyer will surface, as the team has been for sale for more than three years with no one willing to step in unless Glendale pays $15-million to $20-million a year in arena-management fees. Once again it looks as if this could be the team’s final season in Glendale, with a possible move to either Seattle or Quebec City on the horizon.
Anthony LeBlanc, leader of the Ice Edge Holdings LLC group of businessmen who is working with Jamison on the purchase, said no buyer can make the Coyotes sale work given the team’s annual losses unless it receives the same kind of lease Jamison negotiated.
“It is going to be very difficult for anyone to purchase this franchise without a very similar contract in place with Glendale,” LeBlanc said.
Jamison “has not thrown in the towel,” LeBlanc said, but acknowledged it did not look as if he would make the deadline.
In the two previous seasons, Glendale agreed to pay the NHL a total of $50-million to offset the Coyotes’ annual losses, which range from $20-million to more than $40-million. However, this caused financial troubles for the city of 250,000, which faced a budget shortfall of $35-million in 2013. The city still owes the NHL $5-million from last season’s $25-million payment, Weiers said.
As a result, the sale is once again in limbo, with the NHL faced with paying another season of losses for the team. Worse for the NHL, it has no deal with Glendale to collect another $25-million payment. That agreement expired at the end of last season and the NHL had hoped to sell the team to Jamison by the start of this season.
In the meantime, a source said the NHL has an agreement with Glendale to manage Jobing.com Arena for $1-million a month for the rest of the season. Weiers said there is a deal with the NHL that can be transferred to a new owner, but he refused to confirm the amount.
By now, the league’s costs for the Coyotes are well north of $200-million. The league bought the Coyotes out of bankruptcy in October of 2009 for $128-million.
“We remain hopeful the Coyotes sale process will be resolved successfully and we will continue to work with the City of Glendale to move the process forward,” NHL Deputy Commissioner Bill Daly said in a statement on Friday.
Sources say Glendale officials are also trying to find buyers. One source said the city contacted Chicago businessman Matthew Hulsizer, who is hoping to buy an NHL team in partnership with former Tampa Bay Lightning owner Oren Koules. Hulsizer came close to buying the Coyotes, but was never able to agree on a lease with the city. But he and Koules have kept tabs on the Phoenix situation.
Weiers said he was not aware of anyone from Glendale speaking to Hulsizer “because we have a deal on the table right now [with Jamison] and we will honour that agreement until midnight [Thursday].” The mayor said once the deadline passed, he will be willing to speak to other potential buyers.
A source with knowledge of Hulsizer’s plans said he told the city and other people looking to put together groups to buy the Coyotes that he is finished working on that sale. Hulsizer told them he would be interested only if someone presents him a completed deal that makes sense to him. Hulsizer declined to comment on Thursday.
The mayor said he was contacted by two groups looking to buy the Coyotes, but would not identify them. However, multiple sources close to the situation say there is no substantial new group on the scene. One source said this sale has long attracted “tire-kickers galore.”
With a report from The Associated Press