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NHL, Balsillie could be headed for collision course over Hamilton plans

Canadian billionaire Jim Balsillie, the co-CEO of BlackBerry maker Research In Motion, had hoped to get an audience at the NHL's board of governors meeting next week in New York to clear the air on his tentative purchase of the Nashville Predators and possible relocation to Hamilton - but it's not going to happen.

Neither the relocation question or the actual vote on the ownership transfer will be on the board of governors' agenda and Balsillie won't be invited to the meeting, a source told The Canadian Press on Wednesday.

Another source said that the NHL considers the request to deal with relocation "premature" because there is a valid and binding lease in Nashville.

Balsillie's camp doesn't seem concerned.

"There's nothing to read into this other than the process gets delayed," Balsillie's lawyer Richard Rodier said in an interview Wednesday. "There's still a letter of intent, we're still working on a purchase agreement and working to close it."

Rodier said Balsillie is only looking into possible relocation to Hamilton in the event the arena lease in Nashville is terminated, which could happen as early as next summer.

"Our intentions are to buy the Predators and abide by the lease (in Nashville)," said Rodier. "We have to consider the possibility that the lease may disappear through no fault, through no act or omission of ours. It's not in our control."

While the NHL doesn't plan to meet with Balsillie next week, the league will update owners on the Predators situation, talk that guarantees to dominate the meeting.

The transfer of ownership vote is expected to be held later this summer. And it will be intriguing, to say the least.

While Balsillie has apparently drawn the ire of the league's head office and some NHL owners by making contingency plans with the city of Hamilton even though his purchase of the Predators from current owner Craig Leipold has yet to be completed, his purchase price for the NHL club has other owners dancing with glee.

Balsillie has promised to pay between US$220 million to $238 million for the Predators. It's a price some consider vastly inflated, especially since he bid $175 million for Sidney Crosby and the Pittsburgh Penguins earlier this season in his failed attempt to buy that club. Forbes magazine estimated the Predators' value at $134 million earlier this season and the Stanley Cup champion Anaheim Ducks were bought for $70 million in 2005.

Some NHL owners might be pleased with their own franchise values being inflated by the Preds sale but others have frowned upon his dealings with the City of Hamilton and feel Balsillie isn't being genuine in trying to keep the team in Nashville.

Meantime, the Hamilton plans move forward. Hamilton city council was expected to announce on Wednesday night an agreement which hands over control of Hamilton Entertainment and Convention Facilities Inc., a city corporation that runs more than just Copps Coliseum, the hockey arena.

"It contemplates taking over all the facilities, not just the arena," said Rodier. "We would be taking over the arena, the convention centre, the theatre, and the parking garage. And in doing so eliminating the deficit that the city currently runs."

It's believed the city of Hamilton runs an annual deficit of about $4 million a year. The agreement would also signal that Balsillie is choosing Hamilton as his relocation site, not his hometown of Waterloo, Ont., where Research In Motion's head office is located. Balsillie's wife is from Hamilton.

The lease of the Sommet Center with the city of Nashville is a whole other matter right now. City politicians and lawyers appear to be interpreting the lease differently than Leipold, whose offer of sale to Balsillie was under the premise that a loophole to get out of Nashville existed after the 2007-08 season if average attendance was less than 14,000, cumulatively, for two consecutive seasons. The Preds averaged 13,815 this past season - including the playoffs.

The "early termination" clause has to be invoked one year ahead of time, which Leipold planned to do soon. But one Nashville city lawyer said last month that the Predators couldn't invoke their escape clause until after the 2007-08 season, meaning they couldn't leave the city until 2009.

Further confusing matters was a report in Wednesday's "Tennessean" in which Nashville Metro finance director David Manning said the Predators can't exercise their escape clause in their lease until a dispute over the franchise's "tangible net worth" is resolved. The lease stipulates that the city is able to recoup part of its initial $35-million investment in the Predators if the franchise leaves town before the end of the lease in 2028. The city said last year that the Predators' net worth was too low to let taxpayers recover their investment. The dispute remains unresolved.

"They're not entitled to give notice while that issue is unresolved," Manning told the Tennessean.

A call to Manning on Wednesday was not immediately returned.

If and when Balsillie can iron out his issues with the lease, then he can turn his attention to another hurdle in Hamilton - the NHL's bylaws regarding territorial rights, which extend to 80 kilometres of an NHL city's corporate city limits. That puts Hamilton in the crosshairs of both the Toronto Maple Leafs and Buffalo Sabres.

Richard Peddie, CEO and president of Maple Leaf Sports and Entertainment, said Wednesday all he knew was from what he read in media reports.

"I'm really waiting for an analysis and a recommendation from the NHL - which we will get on the 20th (at the board of governors)," Peddie said. "Until I've studied the material and heard what Mr. Bettman has to say, we're really making no statements on this whatsoever."

The Sabres declined comment Wednesday, referring the matter to the league.


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