Canadian top bidder in hunt for Penguins
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If you are among the millions of people who can't live without one of the ubiquitous wireless BlackBerry devices, then you know why Jim Balsillie is a multimillionaire.
Balsillie, chairman and co-CEO of Research in Motion, the company based in Waterloo, Ontario, that makes the BlackBerry, has emerged as the latest frontrunner to buy the Penguins, two sources with knowledge of the sale process said yesterday.
His second pursuit of the hockey team is the latest development in what has been a roller-coaster ride the past several months as fans have waited to see who buys the club and whether the new owner intends to keep it in Pittsburgh.
Balsillie, who has declined comment, was the secretive Canadian bidder who nearly signed a letter of intent with the Penguins in mid-July. He backed out when he realized it wouldn't be simple to move the team. It's believed he wanted to relocate it to Hamilton, Ontario, which is near Waterloo.
After that, four other prospective owners staged a bidding war. Hartford real-estate developer Sam Fingold prevailed and signed a letter of intent in late July, but was not able to reach a purchase agreement with the Penguins, who are owned in part by Hall of Fame player Mario Lemieux.
Fingold and two other bidders -- New York businessman Andrew Murstein and Ohio businessman and Ringgold High School graduate Jim Renacci -- remain involved and interested, but Balsillie has moved ahead of them.
His earlier offer was in the range of $175 million to $180 million.
It's not known why Balsillie re-emerged or what his intentions would be if he is successful in buying the Penguins.
A new owner would be bound to the team's arrangement with Isle of Capri Gaming, which will donate $290 million toward a new arena if it is awarded the city's slots license later this year.
If Forest City/Harrah's or PITG Gaming land the city's slots license, there is a proposed "Plan B" for arena funding that draws on slots and state money as well as contributions from the Penguins.
The team's lease at Mellon Arena expires in June, and Penguins officials maintain they need a new venue to be viable in Pittsburgh.
Under NHL Bylaw 36, the league can block a move to another city if there is a plan to make a team viable. The league also must approve any sale.
An attempt to relocate a team to Hamilton could be met with strong resistance from officials of teams in nearby Buffalo and Toronto.
It seems clear that Balsillie, a native of Peterborough, is entrenched in southern Ontario.
According to RIM's Web site, Balsillie has been the chairman and co-CEO since 1992 and is involved in several community and charitable projects. He's also a sports enthusiast who plays hockey and golf and competes in triathlons.
Balsillie joined RIM following jobs with Prudential Bache Securities, Ernst & Young, and Southerland Schultz Inc. He has a bachelor's degree from the University of Toronto and an MBA from Harvard.
The popularity of BlackBerrys has fueled RIM's explosive growth. The company posted profits of nearly $130 million in its fiscal first quarter that ended in June, up more than six-fold from one previous year on sales that rose more than 9 percent to $613.1 million. In the just-ended quarter, RIM said it expects to report profits to be higher and for sales to fall in the $620 million to $650 million range.
It also expects to have added about 700,000 subscribers, pushing the number of BlackBerry customers to more than six million.
RIM got out of a jam last year when it settled for $612.5 million with a Virginia company that claimed the BlackBerry infringed on its patents. A judge had threatened to suspend BlackBerry service in the United States.
At the time, Balsillie said of the settlement, "There's no question we took one for the team."
First Published September 15, 2006 12:00 am