William Del Biaggio III won't become the majority owner of the Penguins after all, but the California venture capitalist known as "Boots" isn't walking away from the deal completely, either.
If negotiations succeed on the next step in this fiduciary process, after failing in his bid to buy out California supermarket magnate Ron Burkle and Penguins owner-player Mario Lemieux, Del Biaggio will join them as an investor instead.
In short, the reported $120 million deal by Del Biaggio's unnamed group to buy the Penguins fell through, only to be replaced by a potential infusion of money that likely constitutes a figure at least $100 million less.
Penguins officials declined comment last night, making the announcement in a two-sentence news release at dinnertime, around the same time KDKA-TV was airing a story about the aborted sale that turned into a lesser investment.
The release read simply: "The Pittsburgh Penguins announced today that the team's current ownership structure will remain intact, with Mario Lemieux and his partner, Ron Burkle, maintaining a majority ownership stake. William DelBiaggio [sic] will join the team as an investor."
Apparently, negotiations weren't complete before the events of July 22.
But that date changed the fortunes of the Penguins in every sense.
That Friday, the NHL Board of Governors ratified a new collective bargaining agreement with their players, a contract that brought both revenue sharing and cost certainty to a flagging league, which had claimed two of every three of its 30 teams were hemorrhaging money.
That new document alone, and the economic security it provided, caused front-office officials of another NHL club -- one with a relatively new arena -- to calculate that their franchise value immediately increased by 30 percent. The lowest-assessed NHL club, in Forbes' most recent analysis, would have jumped from a roughly $90 million worth to $117 million by that estimate.
Yet imagine the worth of the $101 million-valued Penguins' franchise now, especially when you add in the possibility of securing a slots license, the prospect of a new arena and, that same July 22 afternoon, the amazing impact of one ping-pong ball.
Yes, Sidney Crosby altered even the proposed sale of the franchise.
"Quite a day for us," Lemieux said then.
Coincidentally, Lemieux was lunching with Del Biaggio that same afternoon to chat over parts of the deal, just two golfing buddies and co-owners of the U.S Hockey League team in Omaha, Neb., talking shop.
Lemieux, who long maintained that he eventually would shed his ownership mantle, isn't believed to be the sticking point in the negotiations for Del Biaggio and his group to purchase the majority interest. In fact, a day after the CBA/Crosby windfall, Lemieux told reporters that he expected the purchase agreement to be reached within days. Yet he also suggested that some minority owners might take a second look at the deal after the results of the day before.
"It could always happen," said Lemieux of the limited partners reconsidering, "but I don't see any problems moving forward. But it could happen."
The telephones in the Penguins' ticket offices began ringing off the hook just seconds after the team won the rights to draft Crosby, the most heralded junior-hockey prospect since Lemieux in 1984, and the franchise sold an estimated 150,000-plus tickets thereafter. Single-game tickets have not gone on sale.
None of the parties could be reached last night, but Del Biaggio told KDKA-TV in a telephone interview: "This is a long process. It takes a long time to buy a team. Too much has already gotten out in the press ..."
In 1999, after the franchise's second bout with bankruptcy, Lemieux plowed his $20 million-or-so share -- from contract money owed by previous owners Howard Baldwin and Roger Marino -- into the club as an investment, and Burkle reputedly threw in another $20 million. Burkle is the chairman of the investment-firm Yucaipa Companies, Food 4 Less Supermarkets and Ralph's Grocery, the largest supermarket chain in California.
The Penguins' minority owners include: Wildfire Productions, SMG Pittsburgh, William and Patricia Kassling, the Robert Brooks family, Robert and Mark Hofmann, BBSALP Holdings, FOM (Friends of Mario), The Emperor Group, James Gale, and Paula and Angela Falconi.
Del Biaggio, who submitted a letter of intent to buy the Penguins in May yet got no further, must reach an agreement with Lemieux, Burkle and the rest about his level of investment. While the next step in the sale process would've been a purchase agreement, this alternative plan requires only approval from the Penguins' minority owners and then the NHL. Securing all that, Del Biaggio then would have to sell his minority stake in his hometown San Jose Sharks and hop aboard the Penguins' train.
This far-less involved alteration in the ownership group wasn't expected to affect the Penguins' continuing bids for a slots license and new arena, especially given the new CBA and the arrival of Crosby.
The Associated Press contributed to this report. Chuck Finder can be reached at firstname.lastname@example.org or 412-263-1724.