Phoenix Coyotes May Emerge from Bankruptcy Filing in Midst of NHL Playoffs

The Phoenix Coyotes continue to overcome the odds during what may have been the season’s most challenging season off the ice.

Nearly a year ago the team’s owners decided to file chapter 7 bankruptcy, and the team was sold to the NHL. The team was almost moved to another city in the offseason.

But despite remaining in bankruptcy during the entire season, the team rallied and made the playoffs.

Now, after drawing the defending Stanley Cup champions in the first round of the NHL playoffs, the Phoenix Coyotes find themselves leading the best of seven series two games to one after a convincing win over the weekend.

While the Coyotes were getting it done on the ice, news outlets like the Arizona Republic and New York Times were reporting that the city of Glendale, Arizona was close to striking a deal with new owners.

The city is working to get the team out of bankruptcy while keeping it in Phoenix. Jerry Reinsdorf, who already owns the Chicago White Sox and Chicago Bulls of the MLB and NBA, respectively, is interested in buying the team.

However, he is seeking reassurances for his investment. The Phoenix Coyotes were forced into bankruptcy in part because of their inability to make money. This season, for example, despite sell-out crowds and a play-off run, the team is still likely to lose millions.

So the city of Glendale, in what the Times and Republic call a unique deal, could put in as much as $65 million to help Reinsdorf buy the team from the NHL. Reinsdorf would put in $100 million of his own money, but he would also be fully reimbursed by the city if the team was no profitable after five years.

The NHL owners must agree to the sale, and they could still look at offers from a competing group with designs on taking the team to Canada.

But experts looking at the deal say it is very favorable to Reinsdorf while still leaving the city with a large amount of risk – not to mention the costs. Glendale wants to keep the team in the city because the franchise pays millions of dollars annually to rent their stadium from the city, which is still paying down debt from its construction, reports the Republic.

When the same paper spoke with the team’s previous owners, they said such a deal would have kept them out of bankruptcy in the first place. They also said that the team lost around $300 million in eight years, meaning even more support from the city may not solve all of its woes.

But those problems don’t seem to be affecting the one-ice play of the team, who is only two wins away from advancing to the next stage of the NHL playoffs.