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01-30-2013, 11:16 AM
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In the end, there's only one way this deal makes sense: the league needs to bring down the price close to $ 110M. It really is that simple.

The COG deal makes it conceivable for the team to break even over the long term if we manage to make the playoffs most years, and with perfect execution from the management team. But looking at other playoff teams around the league that aren't turning profits, there's no way this club is ever going to turn a sizable, consistent chunk of cash to investors.

So really, unless the owner's a hockey fan (which apparently won't be the case, it's looking more like a conglomerate of institutional investors), the only upside is increase in value. But what's a realistic target within 5 years? Right now the Sharks, which fill their arena every night, have superstars on the roster, and make the playoffs every year, are valued at $ 225M. Let's say we're shooting for a $ 200M valuation in 5 years. When you start at $170M, that's just not worth the risk at all. If I were to invest in this, I'd to look at an upside of 200%.

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