The Arizona Coyotes are likely to be sold to Ryan Smith, the owner of the Utah Jazz, shortly after their final game. The sale, estimated at $1 billion, is expected to take place between the Coyotes’ last game of the 2023-24 season and the start of the playoffs.
According to a source familiar with the deal, this transaction will involve a provision ensuring current owner Alex Meruelo an expansion team if a new arena is constructed within five years.
The deal will involve transferring the Coyotes’ hockey operations initially to the NHL and then to Smith. Smith intends to relocate the team to Salt Lake City.
Meanwhile, Meruelo will retain control over business operations to proceed with a planned $3 billion project, which includes the construction of a new arena in north Phoenix. Meruelo will also continue to own the Tucson Roadrunners, the AHL affiliate of the Coyotes, and intends to relocate them to Mullett Arena in Tempe, which is presently serving as the Coyotes’ temporary home.
Once the new arena is completed, Meruelo will repay the $1 billion and proceed with the establishment of the expansion franchise. Meruelo and NHL Commissioner Gary Bettman are expected to announce the agreement at a joint press conference next week once everything is finalized.
Coyotes general manager Bill Armstrong traveled to Edmonton on Friday night to inform players and coaches about the team’s plans after news of the potential move to Salt Lake City was leaked.
“We are dealing with several unresolved issues, so we cannot make any official statements at this time,” Meruelo said in a statement released on Saturday. “But I want to assure you that I will address all these issues and your concerns publicly as soon as possible.”
The NHL had supported the Coyotes’ plan to purchase a piece of land at auction to construct a new arena. However, the league was hesitant to continue having the team play at the 5,000-seat Mullett Arena, which they share with Arizona State University’s hockey team.
The Coyotes had aimed to finalize a deal for the land, valued at $68 million, by the end of last year. However, delays pushed the auction until June.
Meruelo has consistently opposed selling the team and turned down numerous offers over the years. However, he decided to proceed with the agreement because he believed it was unfair to the players to continue playing in an arena that did not meet NHL standards, according to the source.
The uncertainty surrounding the land auction meant the Coyotes could not guarantee the construction of a new arena. Given the franchise’s past difficulties in finding a permanent home, the NHL urged Meruelo to explore other options.
Meruelo wanted to keep the Roadrunners and relocate them to Tempe to maintain much of his business operations while collaborating with Phoenix city officials to construct the new arena. Additionally, the group aims to continue the franchise’s youth hockey programs in the state, according to the source.
The Coyotes have faced uncertainty since their relocation from Winnipeg. Initially, the team shared the then-America West Arena with the NBA’s Phoenix Suns before moving to Glendale in 2003.
Financial troubles arose when an ownership group, including developers Steve Ellman and Wayne Gretzky, encountered difficulties. Consequently, the franchise was sold to trucking magnate Jerry Moyes in 2005.
Following Moyes’ bankruptcy filing in 2009, the NHL took over operational control of the team and covered its expenses for the next four years until a group of Canadian businessmen bought the franchise in 2013.
Subsequently, Philadelphia hedge fund manager Andrew Barroway acquired controlling interest from that group in 2014 and the remaining shares in 2017. Finally, Meruelo purchased controlling interest from Barroway in 2019.
The Coyotes previously had a lengthy, multimillion-dollar agreement to play at what was then known as Gila River Arena in Glendale until the city withdrew from the deal in 2015. Since then, the franchise has been operating on a year-to-year lease with Glendale until the city decided not to renew it for the 2021-22 season.
The Coyotes had plans to construct a new arena in Tempe as part of a $2.3 billion entertainment complex. However, voters rejected the proposal in a referendum last year by a significant margin. As a result, the team has been playing its games at Mullett Arena for the past two seasons.
