Lightning sale is in trouble
The bank, Societe Generale, with main offices in Paris, that was going to lend a group led by Hollywood producer Oren Koules up to $110-million to help with his purchase of the Lightning from Palace Sports & Entertainment has closed its sports lending business, Palace Sports CEO Tom Wilson confirmed.
The story was originally in Street & Smith's SportsBusiness Journal, which said the bank was rocked recently when one of its traders lost $7.2-billion in unauthorized trades.
The move comes as Palace Sports was about to announce a purchase agreement with Koules, who heads OK Hockey. Wilson said the deal had been "99 percent'' done.
"And then,'' he said, "the world kind of blows up.''
Both Wilson and Lightning president Ron Campbell said the move has not killed the deal. But Koules must find alternative financing, something probably not easy given the nationwide credit crunch and the sub-prime mortgage crisis.
"Based on our understandings here in Tampa, despite the hardships in the financial markets today, the process is still moving forward, just not at the pace that any of us desired,'' Campbell said in a statement. "Nevertheless, we will continue to work together to get something consummated in as safe and as timely a manner as possible.''
It is the second letdown for Palace Sports which in December voided a purchase agreement with Absolute Hockey Enterprises which defaulted on financial obligations amidst rancor between investors that led to a lawsuit.
Koules, part of the group, was sued by partners Jeff Sherrin and Doug MacLean. Commissioner Gary Bettman brokered a settlement and Koules formed OK Hockey with business partner Mark Berg and, it is believed, California banker Russell Belinsky.
More in Sunday's paper.