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Lightning Sale Nearly Complete

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By ERIK ERLENDSSON

The Tampa Tribune

Published: April 22, 2008

Updated: 04/22/2008 06:49 am

TAMPA - The on-again, off-again saga of the sale of the Lightning may finally be entering an end game.

Although a report surfaced in Sports Business Journal on Monday stating a second lender scheduled to be used by prospective owner Oren Koules backed out of a deal, the sale of the team is nearly complete. When the deal is finally announced, current owner Palace Sports and Entertainment could end up being the primary lender along with Galatioto Sports Partners, which is handling the sale process on the Lightning end, in order to push the deal forward.

"Once all the financial documents are agreed upon, which should happen this week, the last remaining hurdle is NHL approval," Lightning president Ron Campbell said.

Once the final wording of the deal is agreed upon, the league is expected to take four to six weeks to bring the vote to the league's Board of Governors for final approval. Though there is a May 28 deadline, Campbell said that should everything progress as planned, the deal could close by the beginning of June, "if not sooner."

The deal is believed to be for approximately $200 million and includes the team, the lease agreement on the St. Pete Times Forum and 5

1/2

acres of surrounding land. Koules is believed to be financing as much as $100 million of the sale price.

But because the current economic situation has sagged the financial market in recent months, securing a loan through traditional avenues has been difficult. Koules had an agreement with French bank Societe Generale before a $7 billion scandal forced the bank to cease its sports business operations in January. Then on Monday, Sports Business Journal reported that CIT Group - also reportedly in financial trouble - backed out of a deal, although the sides apparently mutually agreed to walk away from the deal about a month ago.

The current financial atmosphere lent itself to PS&E stepping forward to provide part of the financing, a model used in the recent sales of the Montreal Canadiens and Los Angeles Dodgers, according to SBJ.

"So much of what has happened has been out of the control of Oren Koules," Campbell said. "Who would have thought that the first lender would be hit with a $7 billion scandal ... you can't write fiction like that and it's all just been an imposition to his heart-felt desire to step into the role of ownership."

Under the model of current owners bankrolling the new ownership group, two key elements make it a workable situation. Should a situation arise in which Koules and his group find themselves in over their heads, then PS&E would foreclose on the loan and take over as owner until a new owner could be found, something the league likely would find favorable as opposed to a bank taking control of the team.

In the more likely scenario, however, assuming the financial landscape turns around, Koules could then seek a loan in the traditional manner.

Koules continues to remain silent on the situation, declining to comment via e-mail Monday, but he is expected to break that silence once the league gives its approval.

Should the few remaining hurdles be cleared, it would be completed just in time for the June entry draft in which Tampa Bay holds the overall No. 1 pick and is expected to select highly touted center Steven Stamkos. It would allow Koules to make a splash in his first official act as new owner.

It would also end months of road blocks and speculation that began in August during a news conference to announce the sale of the team to Absolute Hockey, a group that included former Columbus general manager Doug MacLean. In between, there was a lawsuit between partners that required NHL commissioner Gary Bettman to mediate a settlement, the trading of star center Brad Richards allegedly pushed by Koules and his partners, and a pair of failed attempts to secure the necessary finances to make the deal happen.

"The market is at unprecedented levels and people are just not able to make any deals," Campbell said. "What Palace has done is step in to provide the financing and provide a good backbone for the deal."

NOTE: Lightning center Jeff Halpern was named one of five members to the NHL's competition committee.

The committee, a joint group that includes members of the league and the players' association, serves to evaluate and make recommendations on matters relating to the game and the way the game is played to the NHLPA's Executive Board and the NHL Board of Governors.

Other players who will serve two-year terms on the committee are defensemen Brian Campbell (San Jose) and Mathieu Schneider (Anaheim), Ottawa forward Jason Spezza and Buffalo goaltender Ryan Miller.

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