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Four or five bids have been submitted; N.Y. broker due to pare list of potential buyers in the next week

Tuesday, July 11, 2006
By Shelly Anderson, Pittsburgh Post-Gazette

By the end of this week or early next week, the number of bidders in the running to buy the Penguins could be reduced to three -- or one.

Four known bidders and a possible fifth have submitted offers. Allen and Company, the New York firm brokering the sale of the hockey team, is analyzing and verifying those bids and is expected to pare the number soon.

When one offer is chosen, that bidder will sign a letter of intent for the right to negotiate exclusively for a period of time.

Although details of the bids remain mostly unclear, the sale price is expected to top $150 million.

Price is thought to be the most important factor, but other aspects carry some weight. Those include the financial ability to close the deal quickly, ability to be approved by the NHL quickly and smoothly, size of the bidding group with smaller being better, and intentions regarding a commitment to keeping the team in Pittsburgh.

Club owners, led by California billionaire Ron Burkle and retired Hall of Fame player Mario Lemieux, would like to finalize the sale by the start of the season in October.

A new owner would be bound to the team's agreement with gaming company Isle of Capri that is geared toward keeping the team in town. If Isle of Capri is awarded the city's slots license, it will donate $290 million toward the construction of a new venue to replace aging Mellon Arena.

Although four bidders have surfaced, there could be a fifth, probably in Canada and possibly wanting to place the team in Hamilton, Ontario.

Hamilton is roughly halfway between Buffalo, N.Y., and Toronto, which could present a problem at the league level because a franchise in Hamilton could infringe on the two nearby.

That city, however, has been striving to land an NHL team for several years. There are tentative plans to renovate Copps Coliseum to meet NHL standards.

The city twice was in the running for an expansion team and was a finalist when Ottawa and Tampa Bay were awarded franchises.

One name that has been tied to potential NHL ownership in Hamilton is Toronto attorney Richard Rodier. He could not be reached for comment.

The four known bidders are as follows:

Andy Murstein, perhaps the local fan favorite because he has been adamant about wanting to keep the team in Pittsburgh. Murstein, president of Medallion Corp. in New York, has several minority partners, including Apollo Management, a private investment firm that bought Pittsburgh-based General Nutrition Companies and, through an affiliate, the U.S. Steel Tower, Downtown.

Previously named partners with Murstein are Pittsburgh natives Mark Cuban, the billionaire owner of the Dallas Mavericks, and Dan Marino, the former Pitt and Hall of Fame Miami quarterback, as well as a Shadyside real-estate firm, Walnut Capital.

It is believed that the Murstein group's bid is not the highest, but that it indicates cash up front would not be a problem.

Sam Fingold, owner of Kenyon Investments in Hartford and a Toronto native, is vying to make the Penguins a family-owned club with his father and brother. He has ties to Kansas City, but said he believes he could work with Gov. Ed Rendell's "Plan B" proposal for a new arena. It calls for the gaming company that gets the slots license to contribute $7.5 million a year and the Penguins about $4 million a year for 30 years.

Jim Renacci, an Ohio businessman, small-town mayor and owner of the Columbus Destroyers of Arena Football, has cited keeping the Penguins in place as his reason for jumping into the bidding. His group includes NBA Denver Nuggets coach George Karl, a Penn Hills native, and a later addition, Cleveland businessman John Ferchill.

Ferchill, chairman and CEO of the Ferchill Group, said yesterday he will contribute an eight-figure amount that is more than 10 percent of the sales price and would hope to develop projects in Uptown and the Hill District in conjunction with a new arena. His company has worked on many urban development projects in Cleveland and Detroit.

A longtime friend and business partner of Karl, Ferchill said he has no interest in running a hockey club, but got involved because of Renacci, who he calls "a real guy who has approached this in a professional manner," and as a way to protect his company's interests in Pittsburgh.

Ferchill -- whose company developed the Heinz Lofts from the old North Side factory and is involved in technology ventures along Second Avenue -- said he has more than $100 million invested in development in Pittsburgh and believes the city is better off with its hockey team.

"I think Plan B might work," Ferchill said of the proposed arena deal should the Isle of Capri plan go unrealized. "I don't know all the details, but Plan B seems viable prior to us looking at it closely."

Lawrence Gottesdiener, chairman and CEO of Northland Investment Corp., near Boston has said he would either keep the team in town or investigate moving it to Hartford.

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Discussion Starter · #2 ·
This is going to get interesting, to say the least!!

I would think if they were going to move the team, that they would want to do it right away, in order to get ticket sales and advertising underway?

I know it probably won't happen before the upcoming season 2006-07, but rather 2007-08, but if the fans in Pittsburgh know that they are going to loose their team, I don't think you'll see too many of them going to the box office to purchase tickets!!
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