Trying to buy the Blazers

From The Daily News of Friday, July 13

The Kamloops Blazers Sports Society’s nine-man board of directors is awaiting receipt of another offer to purchase from River City Hockey Inc.
“We have been anticipating that to be happening because of the activity over the last couple of months,” Murray Owen, the society’s president, said Thursday.
Owen was referring to Vancouver-based businessman Tom Gaglardi, who heads up River City Hockey, and his supporters working over the last while to buy up shares in the society.
The anticipation is about to end because River City Hockey, rebuffed in its bid to purchase the Blazers for $6 million a year ago, is back with a slightly restructured offer for the WHL team.
Gaglardi, who heads up the group that also includes former Blazers players Shane Doan, Jarome Iginla, Mark Recchi and Darryl Sydor, said yesterday that River City Hockey will make a $6-million offer, perhaps as soon as next week.
A letter stating that “River City Hockey will once again present the board of directors of your society an offer to purchase” was delivered to the Blazers’ office at the Interior Savings Centre late Wednesday afternoon. Copies of the letter were mailed to the society’s shareholders, or members, who number about 200.
A year ago, River City Hockey dealt primarily with the society’s board of directors; this time the group is working to involve the society’s members in the process.
Over the last year, Gaglardi and some of the group’s supporters were able to purchase shares that had been owned by Vic Mah of Edmonton. Now, as a member, Gaglardi has a copy of the constitution; he also has a list of members.
“He is putting each shareholder on notice that this is what he intends to do,” Owen said.
Owen added that the board is more prepared to deal with an offer than it was a year ago.
“We have an opinion since that time,” he said, “about where we are legally in terms of if the club were ever to be sold, what the steps and procedures would have to be. I think we have it very clear in our minds what that is.”
Owen also said that he feels what Gaglardi is doing, because he is a member, “is contrary to the constitution.”
“As far as our board is concerned, we believe that the membership would have to change the constitution prior to entertaining offers,” Owen said. “I don’t know if Tom doesn’t understand our position or (if) he doesn’t care . . . he has his own ideas about where he would like to go with it.”
For now, Owen and the board are awaiting the arrival of the offer. Sometime after that, Owen said, the board “will have to respond to his letter.”
And in the end, Owen concluded, it all will come down to what the membership wants.
“Our board is committed to the wishes of the membership,” he said. “That’s all there is to it. Whatever transpires is going to be pretty much whatever the membership of the society wants to do.”
River City Hockey also is undertaking a public relations campaign, one that will include the setting up of a website on which details of the offer will be posted for all to peruse.
Last summer, the group’s $6-million offer never got past the board to members. The board decided on June 27, 2006, that “the assets of the Kamloops Blazers Hockey Club are not for sale.”
The board then scheduled a July 11, 2006, meeting of members. Gaglardi’s request to appear at that meeting was turned down by the board.
At that meeting, the members, by a vote of 49-38, let it be known that the society’s assets aren’t for sale. River City Hockey’s bid to purchase wasn’t presented at that meeting, nor was it ever presented to members.
This time, Gaglardi is making sure that the membership knows what is on the table.
“The offer,” he said, “is a little different this year.”
He then explained that while the number -- $6 million -- is the same, the process in which members would receive money has been changed.
“The difference is that rather than rely on the board to repay the founding members the $1,000 per share,” Gaglardi said, “this offer builds that in. What we’re doing is offering each member $1,000 plus interest at the rate of five per cent simple interest from the date they bought their shares. That amount gets paid separately but it’s deducted from the $6-million purchase price, so we’re still paying $6 million.”
Under these terms, a share purchased for $1,000 in 1984 now would be worth $2,150, including $1,150 in interest.
“A bunch of guys in 1984 put up $1,000 each which was a lot of money then to keep this team here and they’ve held it all along,” Gaglardi said. “The team has appreciated and, although it’s not for profit, why shouldn’t they have their money returned to them, with five per cent simple interest?”
Gaglardi, 39, is a grandson of the late Phil Gaglardi, who was a prominent politician in the Kamloops area. Tom is the CEO of Northland Properties Corp., which owns, among other things, Sandman Hotels, Inns and Suites, Moxie’s Restaurants, and Denny’s of Canada.
Gaglardi and Ryan Beedie, another Vancouver-based businessman, are involved in a lawsuit in which they are suing Vancouver Canucks owner Francesco Aquilini and former owner John McCaw for ownership of the NHL team and its home arena, GM Place. That court action is in recess until Aug. 7.