AEG and Leipold Pursue Predators Stake in Bankruptcy Court

Earlier this week, I took another look at the transaction that allowed William "Boots" Del Baggio to acquire a minority stake in the Nashville Predators. The next step in unwinding Del Baggio's stake in the Predators will take place in a San Francisco court later today, as Del Baggio's creditors stake their claim to his remaining assets in order to settle his debts in a bankruptcy proceeding.

To recap, the Anschutz Entertainment Group (AEG) and Minnesota Wild owner Craig Leipold, then owner of the Predators, loaned Del Baggio the money to purchase the minority stake in the team. AEG floated Del Baggio $7.3 million while Leipold loaned him $10 million.

Apparently, AEG and Leipold have already determined how to split $2.3 million from a Del Baggio bank account and believe that they should have first crack at Del Baggio's stake in the Predators, which is reportedly worth $35 million.

But the complications don't end there. David Freeman, current majority owner of the Predators, believes that his group ought to have a say in who gets Del Baggio's stake, as they have the right to approve any new member of the ownership group. Then again, Freeman is also in a battle with a court-appointed bankruptcy trustee, who contends the team has yet to turn over some financial records. In turn, Freeman's lawyers contend that those records are too sensitive to be revealed publicly.

According to Sean Gordon of the Globe and Mail, an expert in bankruptcy law believe that if the judge approves today's application by AEG and Leipold, that it would open the way to staking a claim on Del Baggio's ownership share. What's left unsaid is whether or not this claim would mean the two parties could take direct control of the share of the team and dispose of it as they wished -- something that would seem to run afoul of NHL bylaws prohibiting ownership stakes in more than one franchise -- or if it simply would mean that they would be paid first if and when the court sells that stake to another party.

Of course, hovering in the background here is Research in Motion founder Jim Balsillie, who I'm guessing would be ready to swoop down and grab Del Baggio's share if it were made available to the highest bidder. Of course, if AEG and Leipold, close allies of NHL Commissioner Gary Bettman, get hold of the share, I'm guessing Balsillie will find himself on the outside looking in one more time.