A group of Canadians is working with a U.S. investment firm on a potential bid for the Phoenix Coyotes.
"We're taking a look at it," said Daryl Jones, a manager director at Research Edge LLC in New Haven, Conn. "We think potentially there's an under-managed business and if our thesis is right maybe there's an opportunity."
Jones, who is Canadian, wouldn't identify the other members of the group. But he said it does not include Toronto Argonaut co-owners Howard Sokolowski and David Cynamon. The NHL has said the Argo owners were interested in buying the Coyotes, but they have not submitted a bid.
Jones said his group's plan "at this point" is to keep the Coyotes in Phoenix and it recently began reviewing the club's finances.
"We have a team of people that are looking at the numbers and evaluating the viability, trying to figure out if there is something to do here," he said, adding that Research Edge is considering making an investment as well.
"We are in the process of filing a background check with the NHL. You can assume that we have talked to them on a very preliminary basis."
Jones grew up in Bassano, Alta., about 140 kilometres east of Calgary. He played hockey at Yale University with another Canadian, Keith McCullough, who started Research Edge.
Jones spent four years working in New York for Onex Corp., a Toronto-based private equity firm, and then joined Research Edge last September. Research Edge specializes in investment analysis and "generating and delivering actionable investment ideas."
Jones said he has never invested in a sports team before. "I do know people that are investors in other hockey teams and have financed pro hockey teams. We're pretty familiar with the business model and how things work," he said.
"We're coming at this from, well, No.1, we're hockey fans and hockey people. But more from a business-investor-type perspective. Can we make this a viable business in Phoenix long term? We think we have some people involved who have some interesting ideas in that regard."
When pressed for details about those people, Jones described them as "marketing and entertainment-type people."
The group doesn't have much time to put together a bid. The Coyotes filed for Chapter 11 protection on May 5 in Arizona and the bankruptcy court is holding an auction on Aug. 5 for bidders who will keep the club in Phoenix. If that auction doesn't yield sufficient bids, the court will hold an auction Sept. 10 for bidders interested in moving the club. Research In Motion co-CEO Jim Balsillie could participate in the September auction. His offer is $212.5-million (all currency U.S.).
So far the only bid for the Aug. 5 auction has come from Jerry Reinsdorf, owner of the Chicago White Sox and Chicago Bulls. He is offering up to $148-million for the club, but his bid carries several conditions, including a new arena lease.
The NHL revealed in a court filing this week that another group was considering an offer. However, the league did not provide any details. Jones's name surfaced in another court filing yesterday.
He said he has looked at the Reinsdorf offer but declined to comment on the details. He also declined to provide specifics about his proposal.
"It's very preliminary at this stage and the timeline is very tight. We're not yet convinced that it's viable. We don't know if we'll get there, but we do think there's some interesting attributes for the situation."