One of the partners who had been involved in the management of the Pittsburgh Penguins NHL outfit is seeking to have the deal that was struck to sell the team to Fenway Sports Group overturned, according to reports in the US.
Last month Liverpool owners FSG completed a deal to acquire a majority stake in the ice hockey team, a deal that was ratified by the NHL this month and adds the Penguins to an FSG empire that already includes the Reds, the Boston Red Sox baseball team and the RSK Racing NASCAR team.
While the financial details behind the acquisition haven't been made public, the Penguins were valued by US sports business website Sportico's analysts at around £650m at the time of the sale, with FSG declaring that they would be keeping the management structure of club legend Mario Lemieux and part owner Ron Burkle in place.
But a court filing with the Delaware Chancery Court is, according to multiple US outlets including Law360, pushing for the deal to be thrown out after limited partners in the Lemieux Group, Wildfire Productions LP, claimed that they had been frozen out of the deal unlawfully. Wildfire claim that they only learned of the deal 20 minutes before it was made public, according to documents publicly available through the Chancery Court.
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In the suit, Wildfire claim: "Through clandestine back-room manoeuvring, Mr Burkle and Mr Lemieux are orchestrating an unlawful cash-out for themselves, while steamrolling and freezing out their limited partners, including Wildfire."
Wildfire claim that 'Team Lemieux', the general partner of the firm, "deliberately ignored" the consent rights that existed when conducting the sale of the team to FSG, with Wildfire also claiming in the suit that Burkle and Lemieux sought to amend the partnership agreement prior to the sale so that they would only need a majority of partners to agree instead of unanimous approval.
"The attempted amendment destroys the fundamental bargain at the heart of this partnership," Wildfire said in the suit.
"It puts in place a revolving door for the general partner position, while locking Wildfire in place, devaluing its interest in the partnership, and leaving it subject to the whims of the new general partner with whom Wildfire did not consent to be partners."
Wildfire are now seeking the Chancery Court to dismiss the amendments to the consent rights and to void the deal that was struck with FSG. Wildfire are also seeking damages against the Lemieux Group and Team Lemieux.
FSG's acquisition of the Penguins is the latest phase of their 'FSG 3.0' plan, and 2022 could well see another team arrive into the empire with an NBA franchise potentially next on the shopping list, while FSG aren't averse to adding another football club to their portfolio, either in Europe, South America or the MLS.
At the time of the sale, FSG partner and Liverpool chairman Tom Werner said : "The Pittsburgh Penguins are a premier National Hockey League franchise with a very strong organisation, a terrific history and a vibrant, passionate fan base. We will work diligently to continue building on the remarkable Penguins' tradition of championships and exciting play.
"We are particularly excited to welcome Mario Lemieux and Ron Burkle to FSG and have the utmost respect for all they have done to build the Penguins into the perennially successful franchise we know today. We look forward to working with Mario, Ron and the entire Penguins front office team."
FSG, who were advised on the sale by Bank of America, have now added to a portfolio worth $8bn that as well as their sporting properties also includes Fenway Sports Management, Fenway Sports Group Real Estate and the NESN regional sports TV network.
Privately, not part of the FSG portfolio, FSG supremo John W Henry also owns the Boston Globe newspaper.
The ECHO has approached Team Lemieux for comment.
