Investor May Buy Majority Share of Pittsburgh Penguins.

Knight Ridder/Tribune Business News

Aug. 12 -- Mark Cuban, a former Pittsburgher who made his fortune from an Internet business in Texas, may invest $40 million or more in the Penguins -- part of a deal that would make him the majority owner of the National Hockey League team.

Cuban's investment in the team would come after former Penguin superstar Mario Lemieux and a group of investors close their deal to buy the team -- possibly next week.

One of those investors -- Ron Burkle, a Beverly Hills billionaire -- may take back his $20 million stake in the team after the deal closes and Cuban adds his money. In addition to the $20 million that would cover Burkle's stake, Cuban might add another $20 million or more to ensure the team has enough cash as it emerges from bankruptcy.

Cuban's attorney, Harry L. Manion III, said Cuban had been in touch with Lemieux because the time required to close the deal on the team has grown so tight.

"What I have informed ... Mario Lemieux is that Mark Cuban's primary interest is in ensuring that this team will stay in Pittsburgh," said Manion, who is also the attorney for current co-owner Roger Marino, who placed the team in bankruptcy last fall.

Closing on the sale is particularly urgent because the team's line of credit from Societe Generale, which is funding current operations while season ticket money is being placed in an escrow account, expires Aug. 20.

"The delays in closing have created the real possibility that this team is going to fold because it is out of money," Manion said. "As a result of that, Mark Cuban has expressed a willingness, through me, to work with Team Lemieux and provide them with whatever they need to ensure that the Penguins will survive in Pittsburgh."

Lemieux's attorney, Doug Campbell, declined comment. Burkle's spokesman, Ari Swiller, did not return telephone calls.

But previously, Lemieux's advisers have said that they were interested in raising additional capital for the team after it emerged from bankruptcy. Campbell said earlier this week that Lemieux's group wants to raise the equity it will bring to the team to $65 million from the $52 million it has already raised.

Lemieux spokesman John Brabender said it's still possible Burkle may remain as an investor after the deal closes. Brabender said Burkle's financial advisers are looking at the long-term viability of the team.

"They were not asking questions someone would ask if they were just coming in for the short term," Brabender said.

Yet Cuban's offer could ensure that the Penguins have sufficient funds to weather any unforeseen financial setbacks once it emerges from bankruptcy.

A $40 million investment would also make Cuban the majority owner of the team, with twice the equity that Lemieux is putting in.

Lemieux's $20 million ownership stake was converted from the debt the team owed to him for deferred wages when it filed for bankruptcy protection.

Brabender said Lemieux's advisers are still trying to close the deal next week so that the marketing campaign for season tickets can begin.

Brabender also stressed that the sale of the team has to close as soon as possible because the Penguins' training camp is scheduled to begin in three weeks.

That is one reason why Cuban, a Mt. Lebanon High School graduate, would invest in the team after Lemieux's deal closes rather than before, since negotiating his partial ownership of the team will take time.

Cuban first looked into investing in the Penguins in April, a month after Lemieux filed his plan to financially reorganize the team. In the ensuing weeks he spoke to Lemieux's advisers and to SMG and Fox Sports Net Pittsburgh, when those two companies proposed their own reorganization of the franchise.

SMG is the team's landlord at the Civic Arena. Fox broadcasts Penguin games.

By the end of June Cuban was out of the deal, but that changed this month after Lemieux went back to Cuban and to Roger Marino seeking more investors.

Cuban founded an Internet company called Broadcast.com, which was bought out by Yahoo!. He has a net worth of about $1 billion.

Cuban has said he is liquid enough to write a check for $50 million.

In April, when Cuban first contemplated investing in the franchise, he said he did not want to run the team himself, but would want people who knew the business of hockey in charge of the operations.

(c) 1999, Pittsburgh Post-Gazette. Distributed by Knight Ridder/Tribune Business News.