[Update: Mike Heika some further information as well, saying that Doug Miller is still a potential bidder at this point. You can read his update on the sale here.]
With the Dallas Stars season underway and the team off to a great start, the ongoing sale and bankruptcy of the franchise has fallen a bit by the wayside. With the deadline for any competing bids to be made fast approaching, I wanted to update everyone on what we believe is currently happening and what we can expect moving forward.
Currently, the bankruptcy proceedings are still right where they were when we last updated on the sale. Tom Gaglardi is the Stalking Horse Bid being used by the bankruptcy filing as the basis for the proposed sale of the team. Gaglardi’s bid is somewhere around $260 million in value, which includes $50 million up front to be paid directly to the NHL upon completion of the sale.
Other matters that still need to be worked out as part of the sale include a number of unsecured claims, including current prospects and former players and coaches, that appear — as part of this bid — to be headed towards not being paid. The Dr Pepper Starcenters are also included in these claims and it’s uncertain as to how they will be affected by the bankruptcy. Right now, it appears that only the secured claims — and this is normal for bankruptcy proceedings — will be paid as part of the sale.
Much more after the jump.
The big question right now is whether there will be any competing bids to Mr. Gaglardi’s. As part of the original motions filed in court, and approved, the deadline for any bids is October 22, which is this Saturday. Since it’s unlikely the courts will accept any bids on a weekend, there’s a question as to when the actual deadline will be — whether it’s this Friday or next week.
There’s also the possibility that an extension could be filed, allowing any prospective bidders a few more days in order to get an approved bid in place.
It’s important to remember that any proposed bid has to be by someone preapproved by the courts and the NHL, and that bid must be more than $10 million in value over the Stalking Horse Bid to be eligible to be submitted to the courts. That bid must then be officially approved in order to move the sale towards the auction proceedings.
From what we can understand, any bid submitted to the court doesn’t have to be announced as approved until November 19, just days before the proposed date for the auction itself. I doubt we’d go that long without any information leaking about the proposed bid, but you wonder if this is to make the auction fair for everyone involved.
It’s also unclear whether this delayed announcement of the bid means that the sale could be finalized before the November 23rd deadline, even without any bids. Based on the recent hearing in court this week that finalizes the motion to allow the Stars access to cash and bank accounts, I doubt that this sale is going to be completed before November — even without a competing bid.
[Update]
I want to clarify the statements above, after diving a bit deeper into the court documents. As part of the approved bidding procedures, the NHL will notify any potential bid on whether that bid has become a “qualified bid” — two days before the actual auction. Right now, that date would be November 19. This doesn’t mean we won’t know if a bid was actually submitted to the court, this means we won’t know if it’s a “qualified bid” until just two days before the auction.
Some more clarification: If there is only one other bid submitted to the court, this doesn’t mean there’s going to be an auction. With just one bid on top of Gaglardi’s, the Debtors can then present to the court which bid they prefer to be approved, at the confirmation hearing.
I’m still trying to find documentation on this, but it seems my original thought that even without another bid the sale wouldn’t be done until November 23 might be false. As part of the current, approved schedule, this would be the case — but if no bid is actually submitted, you have to think the lenders and Gaglardi would file a motion to move the final hearings up in order to complete the sale.
[End update]
Right now, no actual bids have been submitted to the courts. Whether that will change over the course of the next few days is uncertain, but there’s an increasing buzz about Chuck Greenberg’s interest and ability to submit a bid.
Greenberg has suddenly become publicly visible around the Dallas Stars the past few weeks and is showing interest in the ability of this franchise to be successful in Dallas. He obviously has plans on how he thinks this thing can be rebuilt and how to get the fans back and there are increasing hints that a bid is certainly an increasing possibility.
What is not known, however, is just who he has as financial backers as part of this deal. It’s odd that with the deadline so close and Greenberg apparently very interested in making a deal, we’ve yet to get any hint as to who he has involved financially as part of a potential bid — and whether he can actually get enough financial backing locally in order to make such a bid.
So for now, things stand pretty much as they were a few weeks ago. Greenberg is interested but no bids have been made and Gaglardi is still firmly in control as the potential new owner of this franchise. It’s also looking like the completed sale won’t be done until November, with or without a competing bid.