By Ben Klayman
CHICAGO (Reuters) - The Phoenix Coyotes may be sold in an August or September auction after a bankruptcy judge outlined a schedule to address whether the bankrupt hockey team will play its future games in Arizona or possibly Canada.
Judge Redfield Baum of the U.S. Bankruptcy Court in Arizona on Monday ruled a sale of the team -- for which BlackBerry maker Research in Motion Ltd co-Chief Executive Jim Balsillie has offered $212.5 million -- will proceed along two tracks, according to Thomas Salerno, attorney for the National Hockey League team's owner, Jerry Moyes.
Under the judge's schedule, an auction for the Coyotes will be held on August 5 for bidders willing to keep the team in the Phoenix suburb of Glendale, Salerno said.
The NHL has said it wants to keep the team in Arizona and four potential bidders are committed to that.
If the August auction fails to attract a suitable offer, a second auction -- open to other bidders, including Balsillie, who could move the team -- would be held on September 10, Salerno said. The Coyotes, which filed for bankruptcy in May, have never made a profit since moving to Arizona in 1996.
"The judge is 'two tracking' it, but is accelerating the process such that a relocation bid, if approved by the NHL or the court, could still happen for the 2009-10 season," he said in an email.
The money-losing Coyotes are one of the less valuable NHL franchises. On Saturday, the Molson family tentatively agreed to buy control of the storied Montreal Canadiens club in a deal a source previously valued at almost $575 million.
Balsillie has no plans to bid in the first round in August, a spokesman for the avid hockey fan said.
"Mr. Balsillie has been very clear that his plan is to relocate the team to southern Ontario," Bill Walker said. "We don't see value in keeping a team that's losing $35 (million) to $40 million a year where it is."
Balsillie failed in previous efforts to buy NHL teams in Pittsburgh and Nashville, and move them to Hamilton, Ontario.
NHL officials said the league was prepared to adopt the two-tier approach to the auction.
"We are confident ... there's a viable offer that will make this team viable in Glendale," Deputy Commissioner Bill Daly said in a statement.
The NHL said it will discuss the Coyote's bankruptcy at a league owners' meeting on Wednesday.
In a filing on Monday prior to the judge's ruling, the NHL had sought an auction limited to bidders committed to keeping the team in Arizona for at least one year and had expected to make a decision on ownership transfer by the end of July.
The NHL's original proposal would have left Balsillie free to bid on the Coyotes and possibly later move the team. Continued...
Source: Reuters
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