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The Business of Hockey Discuss the financial and business aspects of the NHL. Topics may include the CBA, work stoppages, broadcast contracts, franchise sales, expansion and relocation, and NHL revenues.

Penguins to Winnipeg offer

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Old
01-19-2005, 03:24 PM
  #1
Round John
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Penguins to Winnipeg offer

Don't know if this is old news or not but I still found it interesting.

From the Saskatoon Star Phoenix newspaper.

"The only thing I really know about (the MTS Centre) is the letter that was written to Mario (Lemieux) last year about moving the Penguins there." Saskatoon Blades General Manager and Head Coach Lorne Molleken who was an assistant coach with Pittsburgh at the time.

If the lockout situation continues and a new building doesn't happen wouldn't it make sense for Lemieux to sell and turn his interest into cash? Right now no money is coming in either as a player or as an owner.

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01-19-2005, 03:26 PM
  #2
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Give it up already, EVERYONE. The Pens are NOT going to Winnipeg.

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01-19-2005, 03:36 PM
  #3
arnie
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Quote:
Originally Posted by Round John
Don't know if this is old news or not but I still found it interesting.

From the Saskatoon Star Phoenix newspaper.

"The only thing I really know about (the MTS Centre) is the letter that was written to Mario (Lemieux) last year about moving the Penguins there." Saskatoon Blades General Manager and Head Coach Lorne Molleken who was an assistant coach with Pittsburgh at the time.

If the lockout situation continues and a new building doesn't happen wouldn't it make sense for Lemieux to sell and turn his interest into cash? Right now no money is coming in either as a player or as an owner.
First, no owner would sell during the lockout. A good CBA will dramatically raise franchoise vales.

2. The Pens carefully prepared for thje lockout. Despite what many people think, they are in excellent financial shape right now.

3. Should the Penguins actually move, they are heading straight to Houston. The owners of the arena & Rockwts have already said that they want to buy an NHL team to go with the NBA team. They further said that it doesn't even have to make money - just help pay for the arena.

Houston is something like 4-5th biggest US city. Think the NHL would like a team there or in Winnipeg?

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01-19-2005, 03:37 PM
  #4
Jacob
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Winnipeg would be in the bottom half of the league in attendance even if they sold out every single night.

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01-19-2005, 03:39 PM
  #5
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Quote:
Originally Posted by Jacobv2
Winnipeg would be in the bottom half of the league in attendance even if they sold out every single night.
Ticket sales are but a small portion of NHL team revenues. What's more important are local media contracts, advertising, and luxury box receipts.

With some sort of revenue sharing in the new CBA, and of course, a salary cap, Winnipeg could be a succesfull market, but don't hold your breath.

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01-19-2005, 03:42 PM
  #6
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Quote:
Originally Posted by Jacobv2
Winnipeg would be in the bottom half of the league in attendance even if they sold out every single night.
If their arena is smaller sure, but if the NHL wins than revenue differences throughout the league cease to exist. In a capped enviroment, especially as the NHL is talking about, every team is the same no matter what market they are in. Thus, a NHL team can easily survive in Winnepeg

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01-19-2005, 03:44 PM
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Quote:
Originally Posted by arnie
First, no owner would sell during the lockout. A good CBA will dramatically raise franchoise vales.
The Canucks were just sold, weren't they?

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01-19-2005, 03:44 PM
  #8
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Then why not just leave the team in Pittsburgh? Crumbling arena and all.

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01-19-2005, 03:46 PM
  #9
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Sorry people the pens aren't going anywhere.

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01-19-2005, 03:47 PM
  #10
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This is great news for the Assiniboine zoo! Penguins to go with their polar bears in the Arctic exhibit. Fantastic learning opportunity for the children of Winnipeg!

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01-19-2005, 03:52 PM
  #11
Round John
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I am not suggesting the Pens are moving to Winnipeg or moving at all. What I find interesting is a feeler of some formality was put out about purchasing the Penguins before a new CBA has been negotiated.

You would think an interested pursuer regardless of the team being looked at would wait until a CBA is in place and there is some idea of what the new landscape looks like.

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01-19-2005, 03:55 PM
  #12
Jacob
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It was the mayor of Winnipeg that wrote the letter. He didn't get a response.

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01-19-2005, 04:51 PM
  #13
craig1
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Quote:
Originally Posted by Round John
I am not suggesting the Pens are moving to Winnipeg or moving at all. What I find interesting is a feeler of some formality was put out about purchasing the Penguins before a new CBA has been negotiated.

You would think an interested pursuer regardless of the team being looked at would wait until a CBA is in place and there is some idea of what the new landscape looks like.
And the Pens publicly addressed the rumor (From a few months back nonetheless) . The team president said that that they did receive the letter, did not consider it.

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01-19-2005, 05:08 PM
  #14
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Quote:
Originally Posted by cneely
Ticket sales are but a small portion of NHL team revenues. What's more important are local media contracts, advertising, and luxury box receipts.
So what tv networks are going to broadcast Winnipeg games? Sportsnet West already has Calgary and Edmonton games. TSN isn't going to split their network for Winnipeg games. Non-sports networks have pretty much gotten out of the regional sports business.

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01-19-2005, 05:10 PM
  #15
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Quote:
Originally Posted by nyr7andcounting
If their arena is smaller sure, but if the NHL wins than revenue differences throughout the league cease to exist. In a capped enviroment, especially as the NHL is talking about, every team is the same no matter what market they are in. Thus, a NHL team can easily survive in Winnepeg
Didn't the Jet's leave the Peg when the average team salary was probably less than half of what the salary cap could be set at (30-35M)?

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01-19-2005, 05:18 PM
  #16
craig1
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Quote:
Originally Posted by cneely
Ticket sales are but a small portion of NHL team revenues. What's more important are local media contracts, advertising, and luxury box receipts.
Well, since you are fully aware of the situation, you know that Pittsburgh has one of the best local TV deals in the NHL (Fox Sports Pittsburgh is the carrier). The only thing that they are lacking according to you is the luxury box revenues....and you of course are aware of the many, many other threads where the new arena for the Pens, and the financing methods (slots liscense) are thoroughly discussed.

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01-19-2005, 07:30 PM
  #17
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Quote:
Originally Posted by arnie
First, no owner would sell during the lockout. A good CBA will dramatically raise franchoise vales.

2. The Pens carefully prepared for thje lockout. Despite what many people think, they are in excellent financial shape right now.

3. Should the Penguins actually move, they are heading straight to Houston. The owners of the arena & Rockwts have already said that they want to buy an NHL team to go with the NBA team. They further said that it doesn't even have to make money - just help pay for the arena.

Houston is something like 4-5th biggest US city. Think the NHL would like a team there or in Winnipeg?
The NHL is not coming to Houston anytime soon.

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Old
01-19-2005, 07:45 PM
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Lionel Hutz
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arrgh.....

Do a search, you'll find several threads on this very topic.

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Old
01-19-2005, 07:59 PM
  #19
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Here is some data that will give you some idea where the NHL will be looking (and why they have located franchises where they are). This is a survey of the Top 200 big cities in the US ranked on economic performance.

If you click on the city you will get a snapshot of its economy and population. There are at lest 25 US cities (probably 50) in front of Winnipeg with its declining population of 650,000, stagnant economy and confiscatory tax regime.
http://bestcities.milkeninstitute.org/bc200.html

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01-19-2005, 08:17 PM
  #20
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Quote:
Originally Posted by Jacobv2
It was the mayor of Winnipeg that wrote the letter. He didn't get a response.
It was not a mayor. It was a councillor, Dan Vandal. He is no longer in serving on city council.

I want a team back in Winnipeg, but not at the expense of a franchise like the Penguins. It's a great city with good hockey fans and a great hockey history. I know the pain felt when a much loved hockey team leaves town and I wouldn't wish this on Pittsburgh. Surely there is another city out there that doesn't have the history, who could lose a team without losing an identity.

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01-19-2005, 08:20 PM
  #21
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Quote:
Originally Posted by Wetcoaster
Here is some data that will give you some idea where the NHL will be looking (and why they have located franchises where they are). This is a survey of the Top 200 big cities in the US ranked on economic performance.

If you click on the city you will get a snapshot of its economy and population. There are at lest 25 US cities (probably 50) in front of Winnipeg with its declining population of 650,000, stagnant economy and confiscatory tax regime.
http://bestcities.milkeninstitute.org/bc200.html
Just to clarify, Winnipeg's population is growing, not declining. Last year the city saw it's highest growth rate in over a decade.

Also, the new mayor in Winnipeg ran and won on the platform that he would make the city a much more tax-friendly place for business. He's a self made millionaire/businessman and he will follow through on that.

Not saying Winnipeg will get a team, just making sure facts prevail here.

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Old
01-19-2005, 08:31 PM
  #22
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Quote:
Originally Posted by Don_Cherry
Just to clarify, Winnipeg's population is growing, not declining. Last year the city saw it's highest growth rate in over a decade.

Also, the new mayor in Winnipeg ran and won on the platform that he would make the city a much more tax-friendly place for business. He's a self made millionaire/businessman and he will follow through on that.

Not saying Winnipeg will get a team, just making sure facts prevail here.
Not according to the figures I have seen. Winnipeg is falling back and is expected to be overtaken by several other cities in the next few years.

EDIT actually I am wrong, there is very slow growth. Last year the population rose by 5000 rather than the 3,500 plus of the past few years. Compared to Toronto, Vancouver, Montreal, Calgary and Edmonton - that is stagnant. Compared to the top 200 US cities it is abysmal.

Over five years population growth per Stats Can

Winnipeg 20,000
Quebec City 19,000

Toronto 550,000
Montreal 170,000
Vancouver 150,000
Calgary 110,000
Edmonton 60,000

Hamilton 40,000
Oshawa 36,000
Kitchener 34,000

As I said Winnipeg just will not work as an NHL market. It is not just population it is also has stagant economic growth, lack of significant corporate presence and a confiscatory tax regime. Read the latest reports from the Canadian Taxpayers' federation - it lays the whole thing out.


Last edited by Wetcoaster: 01-19-2005 at 10:56 PM.
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Old
01-19-2005, 09:05 PM
  #23
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The problem for Winnipeg is not the number of hockey fans, its got more than many of the NHLs US cities. The problem is the number of hockey fans that can afford $40-50 a ticket and also the number of businesses that can afford boxes.

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01-19-2005, 09:12 PM
  #24
cneely
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Quote:
Originally Posted by BlackRedGold
So what tv networks are going to broadcast Winnipeg games? Sportsnet West already has Calgary and Edmonton games. TSN isn't going to split their network for Winnipeg games. Non-sports networks have pretty much gotten out of the regional sports business.

Rumor was that back when the "Save the Jets" campaign was on, the Asper family was somewhat interested. Global might be a fit.
I was an accountant for CanWest for a while, they certainly could afford the team, and afford the losses as well. How well that would go over with the shareholders...

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Old
01-19-2005, 09:14 PM
  #25
cneely
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Quote:
Originally Posted by Wetcoaster
If you click on the city you will get a snapshot of its economy and population. There are at lest 25 US cities (probably 50) in front of Winnipeg with its declining population of 650,000, stagnant economy and confiscatory tax regime.
http://bestcities.milkeninstitute.org/bc200.html
Actually, Winnipeg's economy has been doing quite well over the past 5 years, and the population is slowly increasing.

Can't argue about the crappy tax situation, though.

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