Preds can take competing offers

Canadian billionaire Jim Balsillie's offer still on table but hasn't become binding, opening the possibility of other bids -- but NHL is unlikely to smile on a large investor group, so any local bid will need one heavy hitter in charge

Email | Print By Richard Lawson

Nashville Predators owner Craig Leipold now can entertain other offers for the team.

There apparently was a time period for reaching a binding agreement with Canadian billionaire Jim Balsillie that precluded Leipold from talking with others. But sources say that interval has passed, and now he is free to take offers.

The door is thus open for a local buyer to make a bid on the team. It is known that one group of would-be investors is in the works — but whether it can raise a large amount of money from a small number of people remains to be seen. And that's the kind of money team Nashville will apparently need to field in order to secure local ownership of the hockey team.

Sources tell NashvillePost.com that no one has approached the team yet with another offer. Balsillie's deal was supposed close next week. But the NHL board punted on the approval because Balsillie doesn't have a completed application for ownership to be considered.

National Hockey League Commissioner Gary Bettman told the media this week that talk of the team moving to the Canadian city of Hamilton, Ontario was premature because Balsillie lacked a binding agreement with the Predators. Sources said last week that the deal with him was in danger because of legal wrangling with Metro over the lease on the Sommet Center.

The Predators invoked the default clause that gives Metro a year for nightly paid attendance to reach 14,000. Mayor Bill Purcell's administration, however, has challenged that interpretation, arguing the recent season doesn't count toward two consecutive seasons because of the NHL-wide lockout for the 2005-2006 season. The administration also has maintained since last year that the team was in default of the lease because it hasn't increased tangible net worth to $35 million.

Although he doesn't have a binding agreement, that doesn't mean Balsillie's offer is dead. But other ownership groups can compete for the team. Other offers, however, may not come in as rich as Balsillie's $220-million or higher offer. Sources have said Balsillie is overpaying for the team. The offer is $45 million higher than he'd offered for the Pittsburgh Penguins last year.

A group could step forward that would stand a better chance of gaining approval from the NHL, especially if its desire is to keep the team in Nashville for the foreseeable future.

The local group trying to organize still is in its infant stages. David Freeman, chief executive officer of medical waste company Commodore Medical Services, and Herb Fritch, CEO of managed-care insurance plan operator HealthSpring, are so far the only two investors publicly known to be in the group.

Well-placed sources say that it is highly unlikely the NHL would approve a large ownership group for a team. Also, they said Freeman and Fritch aren't the heavyweights in the corporate community needed to make a deal fly. Those CEOs could be investors, the sources said, but it will take a single heavy hitter, or a couple of heavy hitters, with big names and substantial financial wherewithal, to make a deal happen and succeed.

The caliber of people the sources are talking about in Nashville include people such as Tommy Frist, who co-founded HCA, Cal Turner or maybe even Al Gore. Any one of them could operate under the model Martha Ingram, another who clearly has the resources, used in raising the funds for building the Schermerhorn Symphony Center, writing a big initial check but tapping friends in the community for the rest (to the chagrin of non-profits around town).

Frist has the financial resources to buy the team and could well convince some of the healthcare entrepreneurs HCA has spun off over the years to buy corporate tickets and sponsorships. And though Gore couldn't carry the state in his presidential election bid, he may have enough clout to be the front man on a group.

Of course, folks like these may demur if asked. Owning and operating a sports franchise, particularly one that has history of losing money may not be their cup of tea. One Nashville multi-millionaire, speaking on condition of anonymity today, told NashvillePost.com that he had no interest in "being the Predators' sugar daddy,” adding acidly: "I tend to gravitate towards investments that don’t lose millions of dollars per year off into eternity."

The potential for profit is there, though. About two thirds of the NHL teams are profitable, according to people familiar with the league.

Still, owning a sports franchise tends to require a little bit more to be worthwhile. Leipold is something of an anomaly in the NHL. He only owns one sports team. Other owners have more than one professional team or other sports related ventures.

Tom Hicks, a leveraged-buyout financier, in Dallas owns the NHL's Dallas Stars, Major League Baseball's Texas Rangers and is half owner of English soccer team Liverpool FC. He shares ownership in the Liverpool team with the NHL's Montreal Canadiens owner George Gillett, a businessman Hicks' investment firm had helped buy ConAgra's beef operations in 2001.

Stanley Kroenke, a shopping center and apartment developer, owns NHL's Colorado Avalanche, the NBA's Denver Nuggets and is a co-owner in the NFL's St. Louis Rams. Ted Leonsis of AOL riches owns the Washington Capitals, the WNBA's Washington Mystics and is part owner in the NBA's Washington Wizards.

The NHL board of governors, made up of the league's team owners, is meeting in New York today, but discussion of Balsillie and the Preds is not scheduled to be on the agenda. The NHL draft begins tomorrow night in Columbus, Ohio. Whom the Predators draft is as uncertain as how long that prospect will play on Nashville's ice.

One thing for sure is that Nashville will be the talk of both New York and Columbus.