West Coast group to buy Penguins
Team will stay here; Lemieux retains share
Friday, June 10, 2005
By Dave Molinari, Pittsburgh Post-Gazette
West Coast investors have negotiated a letter of intent to purchase a majority interest in the Penguins.
Mario Lemieux, the hockey team's primary owner since it emerged from bankruptcy in 1999, will hold onto a reduced share of the franchise. Most, if not all, of the Penguins' other local investors are expected to do likewise.
Financial details of the agreement are not known, but the West Coast group is led by William "Boots" Del Biaggio, a San Jose, Calif. businessman. Del Biaggio is a friend of Lemieux's and one of his co-owners with the Omaha Lancers of the United States Hockey League. He also holds a minority interest in NHL's San Jose Sharks.
Del Biaggio is president and CEO of Sand Hill Capital, a firm based in Menlo Park, Calif. Sand Hill's Web site describes it as "a leading provider of growth capital to emerging, venture-backed technology companies" that "delivers fast, innovative financial solutions resulting in exceptional returns for clients and investors alike."
Del Biaggio could not be reached for comment last night. The identities of his fellow investors were not known.
The continued presence of Lemieux and others from this area in the Penguins' ownership group reinforces the contention of team officials that there are no immediate plans to move the franchise.
The team's long-term future in Pittsburgh, though, apparently still hinges on getting a venue to replace Mellon Arena, the oldest facility in the National Hockey League. Lemieux long ago announced his intention to seek the license to operate a Downtown slots parlor and use proceeds from it to help finance a new arena.
Having a letter of intent means there is a framework in place for the deal to be finalized, but the process will not end anytime soon. The parties still must produce a signed purchase agreement and eventually will have to have the transaction approved by the NHL Board of Governors.
Barring complications, completing those steps is expected to take four to six months.
Although Penguins officials declined to talk about any aspect of the talks with Del Biaggio's group -- confidentiality agreements are common in such negotiations -- the team did release a statement by vice president of communications Tom McMillan.
"We continue to be in discussions with a group interested in investing in the Pittsburgh Penguins," he said. "The intention of this group is to keep the franchise in Pittsburgh, build a championship-caliber team on the ice and apply for a slots license that will fund a new arena for Pittsburgh.
"Even if there is a substantial new investment in the team, Mario Lemieux will continue to be involved in all aspects of the operation."
In addition to having a share of the Omaha Lancers and the Sharks, Del Biaggio owns part of the Sharks' American Hockey League affiliate, the Cleveland Barons. The NHL undoubtedly will compel him to give up his stake in the Sharks if the Penguins' deal is approved by the league.
According to the Sand Hill Web site, Del Biaggio started the company in 1996. Previously he had founded the Heritage Bank of Commerce and was a co-founder of Pacific Business Funding, a factoring company that was acquired by Greater Bay Bankcorp. in 1998.
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