Wednesday, May 6, 2009

Swift Transportation Owner Gets Donkey Punched

Jerry Moyes, who in late 2006 LBO'ed troubled transportation company Swift Transportation which has been on daily bankruptcy watch for as long as one can remember, just got a swift kick in the groin as his other business venture, the Phoenix Coyotes ended up filing for bankruptcy late last night. Not only is this bad precedent for the wannabe tycoon, but it has the NHL itself worried, as the filing noted the franchise could now move to that much more stable and far less socialist natural park to the north, since the hockey team will likely now be acquired by PSE Sports & Entertainment, owned by RIM co-founder Jim Balsillie.
“Extensive efforts have been undertaken to sell the team, or attract additional investors, who would keep the team in Glendale,” said Coyotes' Chief Executive Officer and Managing Member Jerry Moyes.

“Creating a process under the supervision of a judge assures that anyone wishing to purchase the team will have the opportunity to bid. Likewise, the City of Glendale, which has been very cooperative with efforts to keep the team in Glendale, will be able to provide potential buyers assurances of the City’s willingness to offer incentives to keep the team as a tenant in the arena, the lease for which is subject to rejection in bankruptcy,” Moyes stated. “The process assures that the identities of the new owner and the team’s location will be known by June 30, 2009, thus enabling the NHL to include the team in its 2009-10 schedule.”

“As Managing Member of the Coyotes, I have a duty to seek a transaction that will return the most in sale proceeds to the secured and unsecured creditors,” Moyes said. “No other proposal to acquire the team provided nearly as much payment to the creditors as that offered by PSE, with the understanding that the procedure is in place for other parties to offer more, particularly if the City of Glendale provides financial incentives to keep the team in Glendale. Overbids must exceed the PSE proposal by $5 million and must be fully funded at closing without a financing contingency.”
In the spirit of keeping sports franchises happy (we presume in the vein of the UAW, they were a significant portion of the president's electoral constituency) perhaps it is not too late for Last Resort Socialist Capital.Gov LP to provide a little DIP lovin' here as well? And then to have the LA Clippers (with taxpayer funding of course) throw in a $1 stalking horse bid in order to keep this, first of many, sport franchise bankruptcies in the country, all in the pursuit of the noble goal of keeping money losing ventures firmly planted in domestic soil. (Maybe as a fair and equitable prerequsite for the deal, we should be able to Marcus Camby playing goalie twice a week in his downtime).

And while Mr. Moyes gets the Coyotes bailed out, Mr. Obama should not stop there and also bail out the sickly regional truckload industry seeing how there are no goods needing transportation as an odd offshoot of the green shoots. That should add a few hundred votes for the rapidly approaching 2012 election.

Sphere: Related Content
Print this post
blog comments powered by Disqus