The Business of HockeyDiscuss the financial and business aspects of the NHL. Franchise sales, valuations, TV contracts, ratings, expansion, relocation, the CBA and work stoppage discussion goes here.
Followed by the Interregnum between Kings Phoenix the XXXVII-th and Phoenix the XXXVIII-th:
[PYTHON]
The most interesting thing about King Charles, the first
Is that he was 5 foot 6 inches tall at the start of his reign
But only 4 foot 8 inches tall at the end of it because of
Oliver Cromwell, Lord Protector of England Puritan
Born in 1599 and died in 1658 September
[/PYTHON]
And again, the story revolves around how Greg Jamison "failed to raise enough money" to buy the franchise, etc.
But are we absolutely certain that he failed to raise the money? Or did his investors refuse to hand over the money? Based on conversations I've had with NHL sources, maybe the more accurate account might be that Team Jamison became the latest prospective ownership group to refuse to meet the NHL's stated asking price of $170 million.
In our Coyotes coverage, we almost always blame the buyer, right? Actually, make that buyers. Meaning, just fill-in-the-blank: Mr. _____ (Hulsizer, Reinsdorf, Balsillie, Jamison, Ice Edge Inc.) couldn't seal the deal.
Other times, we haven't hesitated to blame the realtor, if you will. And, no doubt, the City of Glendale has demonstrated its share of political dysfunction and budget ineptitude.
But what about the seller? In this blame game, doesn't the NHL itself share some culpability in a Coyotes sales process that has gone sideways again and again?
The $170M point is....
Like any transaction, if an asset isn't selling, then maybe it isn't priced to sell.
And again, the story revolves around how Greg Jamison "failed to raise enough money" to buy the franchise, etc.
But are we absolutely certain that he failed to raise the money? Or did his investors refuse to hand over the money? Based on conversations I've had with NHL sources, maybe the more accurate account might be that Team Jamison became the latest prospective ownership group to refuse to meet the NHL's stated asking price of $170 million.
In our Coyotes coverage, we almost always blame the buyer, right? Actually, make that buyers. Meaning, just fill-in-the-blank: Mr. _____ (Hulsizer, Reinsdorf, Balsillie, Jamison, Ice Edge Inc.) couldn't seal the deal.
Other times, we haven't hesitated to blame the realtor, if you will. And, no doubt, the City of Glendale has demonstrated its share of political dysfunction and budget ineptitude.
But what about the seller? In this blame game, doesn't the NHL itself share some culpability in a Coyotes sales process that has gone sideways again and again?
The $170M point is....
Like any transaction, if an asset isn't selling, then maybe it isn't priced to sell.
Someone needs to ask Uncle Gary this question.
The asset is reasonably priced. The franchise that is. That doesn't necessarily mean that this franchise must play in Phoenix.
Let's look at it this way. The NBA bought the Hornets in Dec 2010 for $300 million and sold them in early 2012 for $330 million to the Saints owner Tom Benson. So the NBA seemed to know what it could sell the franchise for an keep it in New Orleans and it picked up a decent profit for it's efforts. The NHL, on the other hand, has only attracted clowns and shysters to the Coyotes, none of them seemingly close to a deal at any point.
I seem to remember Winnipeg having the lowest ticket prices in the league and poor attendance before they left too.... Jets fans should be thankful they got their team back and get off their high horse. The Coyotes have a group of hardcore fans that will be just as upset as Winnipeg fans were if their team leaves. There's no need to act superior.
Take this as you will, but attendance wasn't that poor for a team with ownership issues and a terrible arena (see Coyotes attendance the last few seasons, minus the terrible arena part) compared to the rest of the league. In fact, it was closer to the league average than it is today.
If you take Winnipeg's attendance (84.5% capacity) from the '94-95 season, divided by the NHL's average attendance for that season, Winnipeg played to 87.9% of that number (below average).
If you take Winnipeg's attendance (sold out arena) from this season, divided by the NHL's average attendance for this season, Winnipeg plays to 84.9% of that number (even more below average...oh my!).
The only "poor" attendance numbers were from the lame duck '95-96 season, after we had already said good-bye to the team...
^ ...the saddest video on YouTube.
There's no way I can defend the ticket prices...I remember cheap tickets being sold at 7-11 and Bi-Way ($10-15 a game?) which is not much different than Phoenix twenty years after the fact.
The NHL, on the other hand, has only attracted clowns and shysters to the Coyotes, none of them seemingly close to a deal at any point.
The reason we do this dance with the clowns is due to the above market asking price. I'd like an explanation from the league as to why the city is forced to bear the burden of the legal battle. The only reason the NHL paid $140 million was to appeal to the BK court.
The reason we do this dance with the clowns is due to the above market asking price. I'd like an explanation from the league as to why the city is forced to bear the burden of the legal battle. The only reason the NHL paid $140 million was to appeal to the BK court.
The NHL can have at least that price moving this franchise elsewhere.
Franchise does not belong to the city. Not fun for Glendale I know but it is what it is.
I'd love to watch Glendale sue the NHL once the team left.
We'll never know what the story would been if Glendale bought the franchise. I don't know the BK case details.
The asset is reasonably priced. The franchise that is. That doesn't necessarily mean that this franchise must play in Phoenix.
To be honest, the guy that bought the St-Louis Blues got a much much better deal. Actually, he got the arena, the opera hall and an NHL team for $140M.
But this question raises another one : Does anyone else still thinks NHL IS NOT working on putting a team in a chosen city and are simply awaiting final approval (Read : Sale of Sacramento Kings to Hansen).
To be honest, the guy that bought the St-Louis Blues got a much much better deal. Actually, he got the arena, the opera hall and an NHL team for $140M.
But this question raises another one : Does anyone else still thinks NHL IS NOT working on putting a team in a chosen city and are simply awaiting final approval (Read : Sale of Sacramento Kings to Hansen).
I tend to lean on those lines as well and the Kings sale to Hansen is related. The NHL will be pretty silent from now until just after April 19 (NBA BoG meeting).
After that date, I can see the parts moving along at a much faster pace
For those hoping that JR re-enters the game. Last week on HNIC it was reported by Glen Healy that JR was willing to invest in the Coyotes. However, Healy reported that JR would only pay .50 cents on the dollar. That would either work out to $70 million or $85 million depending if it was a selling price of $140 or $170 million.
So that would make Leblanc. Hulsizer and JR all involved.
This price would coincide with what local bidders were willing to pay for the Thrashers. In fact it would be a little higher.
I wonder how close GJ is to closing the deal. He did say he was continuing to work on it didn't he?
The NHL can have at least that price moving this franchise elsewhere.
Franchise does not belong to the city. Not fun for Glendale I know but it is what it is.
The city should not be held hostage for subsidies necessary to meet the $170 million asking price. How many worthwhile investors would be willing to pay twice what the team is worth? None, and what we get is the clowns attracted to this situation thus far. The NHL is externalizing the cost of defending its franchising rights by passing it on to Glendale. An absolutely absurd and reprehensible approach, given that the city built a distressed team a shiny new facility. People here are cheering this on for some reason. QC and other markets should absolutely have a shot at a team, but not this way.
The asset is reasonably priced. The franchise that is. That doesn't necessarily mean that this franchise must play in Phoenix.
The asset is reasonably priced if you are QC or Seattle, but it is not reasonably priced for being in Glendale.
It's no different than a house. Why is the exact same house in City A $190,000, but in City B its $450,000? Because that is what the market will bare AND still allow the seller to sell. If the seller in City A asks for $400,000 what happens? The house sits on the market unsold for 4 seasons. Everything in the world only has value if someone is willing to pay for it.
The only reasons I see for the NHL to insist on the price of $170M are:
1- When Bettman bought the team out of BK he promised his bosses ( the owners ) that he was going to make them whole on the sale including expenses. Truth be told, IMO 80% of the other owners don't give a rat's behind about the Coyotes staying in Glendale. Maybe they did in the beginning, but after 4 years... they just want their money back.
2- The NHL is keeping the price high for the sole purpose of selling it in a relocation and have no intentions of keeping it in Glendale. They have been able to use the CoG's desperation to finance losses for two years and people's desire to get something using other peoples money ( re: Hulsizer, IEH, etc. ) to buy time until the team can be moved.
The city should not be held hostage for subsidies necessary to meet the $170 million asking price.
I appreciate the sentiment, and even more or less agree with it. However, the city is not without blame here. They could have told the judge they like the Balsille offer, or at least used it as a lever to get more out of the NHL.
At some point, every enterprise faces the reality of having its bad decisions catch up with them.
2- The NHL is keeping the price high for the sole purpose of selling it in a relocation and have no intentions of keeping it in Glendale. They have been able to use the CoG's desperation to finance losses for two years and people's desire to get something using other peoples money ( re: Hulsizer, IEH, etc. ) to buy time until the team can be moved.
This is absolutely abhorrent but it appears to be the case. You have to give credit to them for playing the long game so well. They had an easy out, should Glendale not cough up that $50 million. That bought enough time to get the arena juices flowing in other markets. I'm sure they would have sold to Reinsdorf, but once that ship sailed, we moved on to plan B. At any point during this entire process, the league could have cut the price and saved several of the deals. But they aren't interested in that. They want the $170 million, come hell or high water. If they have to trash a city in the process, so be it.
Without the CFD nonsense, Reinsdorf's bid was roughly ~$100 million. I'm sure there would be plenty of buyers at that price point, given the improved situation all around. I don't know how a city can take any pledge of support from the NHL seriously after this.
This is absolutely abhorrent but it appears to be the case. You have to give credit to them for playing the long game so well. They had an easy out, should Glendale not cough up that $50 million. That bought enough time to get the arena juices flowing in other markets. I'm sure they would have sold to Reinsdorf, but once that ship sailed, we moved on to plan B. At any point during this entire process, the league could have cut the price and saved several of the deals. But they aren't interested in that. They want the $170 million, come hell or high water. If they have to trash a city in the process, so be it.
Without the CFD nonsense, Reinsdorf's bid was roughly ~$100 million. I'm sure there would be plenty of buyers at that price point, given the improved situation all around. I don't know how a city can take any pledge of support from the NHL seriously after this.
I agree totally on this. NHL as a league is not honest, not forthcoming, and will take advantage of any one or anything they can.
However, as others have said, the CoG itself gave away the 50M....
The city should not be held hostage for subsidies necessary to meet the $170 million asking price. How many worthwhile investors would be willing to pay twice what the team is worth? None, and what we get is the clowns attracted to this situation thus far. The NHL is externalizing the cost of defending its franchising rights by passing it on to Glendale. An absolutely absurd and reprehensible approach, given that the city built a distressed team a shiny new facility. People here are cheering this on for some reason. QC and other markets should absolutely have a shot at a team, but not this way.
XX
Not my intent to start a snowball throwing game with you,
Glendale's problem is not the NHL, its the lack of people in the ?&*&% arena they built.
You wanna say "not their fault, they never had a decent ownership"? Go ahead.
The NHL not dropping the price for GJ (if he did had money somewhere) is the evidence Gary Bettman throw the towel.
Whats the real value of this franchise in PHX? 20M$ 10M$ maybe zero?
The NHL will never sell the team 20M.
But if you want to get into the blame the NHL game, go ahead, and sing all together BLAME NHL BLAME NHL. At least, it won't be BLAME CANADA.
... posted with a sense of humour... with respect to XX, who is a true hockey fan, like many Coyotes fans who post here.
Last edited by QcBlizzard: 02-12-2013 at 05:21 PM.
The asset is reasonably priced if you are QC or Seattle, but it is not reasonably priced for being in Glendale.
It's no different than a house. Why is the exact same house in City A $190,000, but in City B its $450,000? Because that is what the market will bare AND still allow the seller to sell. If the seller in City A asks for $400,000 what happens? The house sits on the market unsold for 4 seasons. Everything in the world only has value if someone is willing to pay for it.
i think its more like a motorhome. one that can be moved. a million dollar coach parked on a lot in phoenix isnt gonna be worth much more or less than if someone drove it to, hmmm, say, quebec or hamilton. the nhl is simply pricing it based on what they paid for it as well as what they can likely get for it if someone wants to drive it up the road.
edit to add: they'd be stupid to do otherwise.
Last edited by GuelphStormer: 02-12-2013 at 05:30 PM.
The reason we do this dance with the clowns is due to the above market asking price. I'd like an explanation from the league as to why the city is forced to bear the burden of the legal battle. The only reason the NHL paid $140 million was to appeal to the BK court.
So who should fill the gap between the $140 million (now $170 million) and whatever the franchise is actually worth. Either the league eats that cost or it gets passed to the city in some way. You want to know why the city should eat it, I conversely want to know why the league (and consequently the other 29 teams) eat it?
On the contrary, the NHL is nearly the sole cause of this. Glendale built the arena under the guise that an NHL team would be the main tenant, and signed the club to a 30 year lease accordingly. The NHL, for whatever reason, allowed Moyes to place the team into bankruptcy which voided the lease that the city was counting on. The league then held the team hostage, with all parties aware that TNSE was ready and willing to take a team at any point. During this fiasco, Atlanta boiled over and the NHL's hand was forced. Do we send Phoenix or Atlanta? For the sake of keeping up appearances, and with the benefit of the money from Glendale, the league sent Atlanta packing. Now they've been forced to wait until a new market is ready and willing, which QC seems to be.
At no point was the NHL, throughout this entire process, forced to legitimately look for a local buyer. If you consider their moral imperative as a corporation (profits for stakeholders) then their actions to this point are actually rather predictable. Why sell the team for a discount when you can extract full price and then some from a new market? Optics be damned. If Winnipeg or QC had built an arena specifically for a team, only to watch that team snake off, you guys would be screaming bloody murder. I think the league crosses over into dangerous territory, legally speaking, when they front buyers as legitimate (and deals as solid) when they have no intention of realistically selling the team to a local buyer. They managed to coax $50 million out of a city under duress, and this is somehow okay because the council deserved it?
Why should a city watch a major investment crumple before their very eyes because the NHL didn't handle Moyes correctly? Why should the city be coerced into giving up hefty subsidies because the NHL didn't do its job? Normally, a corporation would just write off that $70 million as the cost of defending their legal franchising rights. Why do you think the NBA, NFL and MLB were all hovering around, curious about the outcome? I believe at one point they even sent letters in support of the NHL. The right to dictate where you do business is worth everything. But when you have the opportunity to externalize that cost and pass it off to the public, why not? It's absolutely predictable, if you consider the amoral and pathological nature of a corporation.
I am thoroughly disgusted by this. The illusion that the league cares about the markets in which it operates has been totally shattered for me. It will be nearly impossible for me to support a business that conducts itself in such a way.
Quote:
Originally Posted by aqib
So who should fill the gap between the $140 million (now $170 million) and whatever the franchise is actually worth. Either the league eats that cost or it gets passed to the city in some way. You want to know why the city should eat it, I conversely want to know why the league (and consequently the other 29 teams) eat it?
I'm curious to see your argument supporting the NHL (or any other business) in offloading costs onto taxpayers.
a million dollar coach parked on a lot in phoenix isnt gonna be worth much more or less than if someone drove it to, hmmm, say, quebec or hamilton. the nhl is simply pricing it based on what they paid for it as well as what they can likely get for it if someone wants to drive it up the road.
