Charles Wang has agreed to sell a minority stake in the New York Islanders to a pair of businessmen who will assume majority control of the Brooklyn-bound team in two years.
The Islanders confirmed on Tuesday that Wang will sell the minority interest to Manhattan investor Jonathan Ledecky, a former co-owner of the Washington Capitals, and Scott Malkin, who owns upscale shopping centers across Europe.
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The deal is contingent on the approval of the NHL's Board of Governors, which is composed of representatives from each team. Financial terms were not disclosed.
Wang will remain the majority shareholder and represent the Islanders on the Board of Governors for the next two years, the team said. An Islanders spokesman confirmed that Wang will be a minority partner after two years.
Wang has owned the Islanders in part or wholly since 2000, and the team will play its final season in Nassau Coliseum before moving to Brooklyn's Barclays Center next fall.
"We are pleased to have the opportunity to become partners in the New York Islanders with Charles, and to pursue our shared dream of winning a fifth Stanley Cup for the greatest fans in the NHL," Ledecky said in a statement released through the team on Tuesday after Newsday first reported the story.
Ledecky and Malkin have been friends for more than 30 years and were roommates at Harvard, according to the Harvard Crimson.
Ledecky was chairman from 1999 to 2001 of Lincoln Holdings, which held interests in the Capitals and the NBA's Washington Wizards. Malkin is chairman of UK-based Value Retail, a syndicator of high-end European retail outlets.
"I'm thrilled that Jon and Scott have agreed to join me as we start the Islanders' final year at Nassau Veterans Memorial Coliseum," Wang said in a statement. "I look forward to a long and successful partnership."
Wang, a billionaire founder of Computer Associates, a Long Island software company now known as CA and based in Manhattan, had tried unsuccessfully for nearly a decade to develop the Lighthouse Project, which would have featured a new arena for the Islanders in Uniondale.
Newsday reported in 2009 that Wang was losing $20 million a year on the Islanders.
Efforts to improve an aging Nassau Coliseum failed, including a referendum in 2011 defeated by Nassau County voters that would have financed a $400 million renovation. Wang announced in October 2012 that he planned to move the team to the Barclays Center in Downtown Brooklyn when the team's lease at the Coliseum expires after the upcoming season.
"I'd have to say it's good news," said Islanders Hall of Famer Bob Nystrom, a member of the team's four Stanley Cup championship teams from 1980 to '83. "I know Charles has been looking to sell for a while. I definitely think you've got to look on the positive side of it. We've been hearing rumors for so long, years actually. I know Charles really did want to get out after the Lighthouse debacle. I think that kind of iced it for him. So it's positive, for his side and for Islanders fans."
Wang has been fielding offers for the team since February, when word leaked that Philadelphia-based hedge fund manager Andrew Barroway had significant interest in buying the Islanders, but talks broke off.
Barroway filed a lawsuit against Wang earlier this month, alleging Wang backed out of an agreement to sell the team to him for $420 million. The suit said that after the initial agreement, Wang raised the asking price to $548 million because the Los Angeles Clippers of the NBA had been sold for $2 billion to former Microsoft chief executive Steve Ballmer.
Barroway's lawsuit, filed in state Supreme Court in Manhattan, asked a judge to either enforce the agreement that the two sides had drawn up -- but had not signed -- or award him the $10 million "breakup fee" included in the paperwork.
Anthony Sabino, a Mineola-based trial lawyer who teaches law at St. John's University, said Barroway's "most powerful weapon" in response to Tuesday's announcement is to file an injunction asking a judge to stop the sale until his lawsuit is decided.
"However, there's an extremely high legal burden there," Sabino said. "There are many hurdles to overcome, the first being that you must show the likelihood that you would ultimately prevail on the merits of your lawsuit."
Another option, Sabino said, is that Barroway could do nothing and proceed with the lawsuit while Wang continues with his sale to Ledecky and Malkin.
Barroway attorney Simon Miller, reached by phone on Tuesday, declined to comment about the Islanders' sale announcement.
An NHL spokesman had no comment other than an email saying, "There is nothing for us to say unless and until the Board of Governors approves any transaction like this."
Wang, along with former Computer Associates chief executive Sanjay Kumar, bought the Islanders in 2000, paying $74.2 million and assuming $97 million in existing liabilities.
With Jim Baumbach, Mark Herrmann and Joe Ryan