Philadelphia, PA (Sports Network) -
It appears as though the Phoenix Coyotes are staying in the desert, leaving Jim Balsillie out in the cold once again.
The NHL board of governors met Wednesday in Chicago to mull over a trio of offers to buy the financially floundering Coyotes and, not surprisingly, the board ruled unanimously against Balsillie and in favor of a group led by Chicago Bulls and White Sox owner Jerry Reinsdorf. A U.S. Bankruptcy Court judge still has to decide which group will ultimately come to own the Coyotes, but it's highly unlikely that the court system will rule against the board of governors decision.
Balsillie, the Canadian billionaire whose company Research in Motion created the immensely popular BlackBerry smartphone, was shot down for a third time in his attempt to purchase an NHL club, having previously been thwarted in his pursuit to buy the Pittsburgh Penguins and Nashville Predators. The stumbling block in all three bids was his desire to relocate the teams to southern Ontario.
NHL commissioner Gary Bettman is clearly opposed to any club moving to southern Ontario because he has legitimate concerns that relocating a team to that area would infringe upon the territory of the Toronto Maple Leafs, and to a lesser extent the Buffalo Sabres.
However, the most troubling aspect of the NHL's rejection of Balsillie this time around is Bettman and the board of governors' complete disregard for financial feasibility. After all, Balsillie made a bid of $212.5 million for the Coyotes, blowing away the Reinsdorf group's offer of $148 million.
Bettman failed to give a reason as to why Balsillie's attempt to buy the club was denied despite the fact that his offer was close to $65 million more than the winning bid. Instead, Bettman chose to simply restate the obvious, saying "In Mr. Balsillie's case, it was the unanimous vote of all members present and voting that his application not be approved."
To be fair to Bettman, he has an obligation to protect the interests of teams like the Maple Leafs and Sabres, but what about the future prospects of the Coyotes franchise? The team reportedly has lost about $200 million since 2001 and it doesn't seem likely that the club's financial prospects will improve anytime soon, considering the dire state of the U.S. economy at the moment.
The Coyotes have not put a quality product on the ice in recent years and the team's attendance has reflected that. Last year, Phoenix ranked 28th out of 30 teams in attendance, averaging just 14,875 fans per game. The fact that the club hasn't made the postseason since 2002, and that the franchise has never won a playoff series since moving from Winnipeg 13 years ago, doesn't help the situation.
One person who can't be happy about the rejection of Balsillie's bid for the Coyotes is the team's previous owner Jerry Moyes, who will likely only be able to recoup his debt and not make a profit as a result of the approval of the Reinsdorf group.
The real question for the future is how long Bettman will be able to keep Balsillie from acquiring an NHL franchise for the purpose of moving the club to southern Ontario. After all, the CEO has deep pockets with a reported net worth of $3.4 billion and, even after this latest defeat, his determination to realize his goal is still strong.
Sooner or later, Balsillie will get what he wants because the NHL simply has too many struggling franchises in non-traditional hockey markets in the U.S. Whether it be in Nashville, Atlanta, Florida, Carolina, Phoenix, etc., the financial woes for these types of NHL franchises are not going to simply go away.
It's like Bettman and Balsillie are playing a game of Whac-A-Mole. Every time Balsillie pops up to make a bid, the commissioner knocks him down. But as anybody who's played the game knows, the mole always wins in the end.