HFBoards

Go Back   HFBoards > General Hockey Discussion > The Business of Hockey
Mobile Hockey's Future Become a Sponsor Site Rules Support Forum vBookie Page 2
Notices

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

Phoenix XCVII: Forget it, Jake. It's Glendale.

Closed Thread
 
Thread Tools
Old
07-13-2013, 05:12 PM
  #676
seasontixholder*
 
Join Date: Jan 2013
Location: Mom's Basement
Country: St Lucia
Posts: 2,118
vCash: 500
Quote:
Originally Posted by MuzikMachine View Post
Would there be anything stopping RSE from relocating the Coyotes in 5 years? There's an out clause for the lease, but would that force them to sell the franchise?
Probably can sell it. Think of it. Lose $50 million for a few years then sell the team for about $250 million for relocation. Its a good investment in the long run. Most of the money is loans anyways. The Ice Edge clowns have no money.

seasontixholder* is offline  
Old
07-13-2013, 05:38 PM
  #677
hisgirlfriday
Global Moderator
 
hisgirlfriday's Avatar
 
Join Date: Jun 2013
Posts: 16,885
vCash: 500
Quote:
Originally Posted by seasontixholder View Post
Probably can sell it. Think of it. Lose $50 million for a few years then sell the team for about $250 million for relocation. Its a good investment in the long run. Most of the money is loans anyways. The Ice Edge clowns have no money.
The fact that Fortress can convert what they've loaned the ownership group into equity in the team makes me think even if the Arizona boys for some reason didn't want to move after 5 years in AZ with enough losses they were allowed to leave that Fortress would step in at that point and get the equity stake in the team to force a sale to ensure they get their money back.

Another thing I wonder about is whether Fortress is even bound by the agreement to keep the team a full 5 years at all because that was a deal reached between COG and IceArizona. Fortress didn't sign it and wasn't a party to it.

hisgirlfriday is offline  
Old
07-13-2013, 07:30 PM
  #678
mesamonster
Registered User
 
Join Date: Oct 2011
Location: Scottsdale, AZ.
Country: United States
Posts: 1,614
vCash: 500
Quote:
Originally Posted by kihekah19 View Post
I think we can all agree that the gate here could use some help! If not, hey I'm great with that - more room for me, I can hear the skate blades cutting into the ice, pucks & sticks, the boys communicating etc.!

Hard core fans HF boards or not that don't go to the games are a problem here in the valley. I've railed for years that there are plenty of fans and people here that the game has been good to - they just need to show!
The attendance issue has multiple reasons for the anemic support. I contend that the location in Glendale is a major problem for the pre-holiday crowds during the weekdays! Too many folks do not want to fight the sun and traffic. say what you will, if the arena was located where the Ice Den is attendance would not be as much of a problem.

mesamonster is offline  
Old
07-13-2013, 07:35 PM
  #679
mesamonster
Registered User
 
Join Date: Oct 2011
Location: Scottsdale, AZ.
Country: United States
Posts: 1,614
vCash: 500
Quote:
Originally Posted by seasontixholder View Post
Think of this. RSE loses $50 million. Pull the plug and sell the team for over $200 million to another city. Sure they lose money for a few years but in the end they'll make much more. They key is to watch this group on how they conduct business, advertising, pricing, etc.
I`m not sure if i have this purchase price and all of the leverage mechanisms correct however, if RSE is forced to pay the COG $45MM, per their "Make Whole" agreement. Pay the league back the $80MM line of credit(assuming they tap it in its entirety) and pay Fortress the $120MM owed in principle. SHould they sell the team for $250MM it does not look like they will be making a dime?

mesamonster is offline  
Old
07-13-2013, 07:53 PM
  #680
seasontixholder*
 
Join Date: Jan 2013
Location: Mom's Basement
Country: St Lucia
Posts: 2,118
vCash: 500
Quote:
Originally Posted by mesamonster View Post
I`m not sure if i have this purchase price and all of the leverage mechanisms correct however, if RSE is forced to pay the COG $45MM, per their "Make Whole" agreement. Pay the league back the $80MM line of credit(assuming they tap it in its entirety) and pay Fortress the $120MM owed in principle. SHould they sell the team for $250MM it does not look like they will be making a dime?

There must be a reason for them buying it. They'll never make any money in the desert. History has shown everyone that in the past.

seasontixholder* is offline  
Old
07-13-2013, 08:13 PM
  #681
Tinalera
Registered User
 
Tinalera's Avatar
 
Join Date: Feb 2007
Location: The Known Universe
Posts: 6,363
vCash: 500
Quote:
Originally Posted by seasontixholder View Post
There must be a reason for them buying it. They'll never make any money in the desert. History has shown everyone that in the past.
It's tough to think why besides the obvious idea that they want to make bank in 5 years when they sell the franchise to someone for a huge amount. The problem is, they may get the groups paying what they're hoping. There are other teams for sale I'm sure (though maybe not relocation ones) that they could buy to get their "hockey fix"

I actually wouldn't be surprised (tinfoil hat I know) if NHL within the next 5 years announces expansion, and prices those expansion franchises at an amount where said cities would consider it cheaper from the NHL than from Leblanc and co.

Yea, I'm actually suggesting that NHL might shaft RSE a bit and give at least two of said city franchises at a price/enticement lower than RSE offers-leaving RSE floundering.

Tinalera is offline  
Old
07-13-2013, 08:27 PM
  #682
hisgirlfriday
Global Moderator
 
hisgirlfriday's Avatar
 
Join Date: Jun 2013
Posts: 16,885
vCash: 500
Quote:
Originally Posted by mesamonster View Post
I`m not sure if i have this purchase price and all of the leverage mechanisms correct however, if RSE is forced to pay the COG $45MM, per their "Make Whole" agreement. Pay the league back the $80MM line of credit(assuming they tap it in its entirety) and pay Fortress the $120MM owed in principle. SHould they sell the team for $250MM it does not look like they will be making a dime?
Where in the agreements is the make whole agreement on paper? I tried finding it but unfortunately the Glendale PDFs of their agreements are not PDF search enabled so it's extra tedious.

Also FWIW it's an $85 MM line of credit and I doubt the NHL ever expects it paid back. They'll either just forgive all or a portion of it or take an equity stake out of the future sale. I mean they've already set it up that RSE doesn't have to pay the NHL back a thing for 5 years at least.

hisgirlfriday is offline  
Old
07-13-2013, 08:32 PM
  #683
Dado
Guest
 
Country:
Posts: n/a
vCash:
Quote:
Originally Posted by seasontixholder View Post
There must be a reason for them buying it. They'll never make any money in the desert. History has shown everyone that in the past.
"To come to Aqaba by land, you should have to cross the Nefud Desert."

 
Old
07-13-2013, 08:34 PM
  #684
enarwpg
Registered User
 
enarwpg's Avatar
 
Join Date: Jun 2011
Location: Winnipeg
Posts: 677
vCash: 500
Quote:
Originally Posted by seasontixholder View Post
Probably can sell it. Think of it. Lose $50 million for a few years then sell the team for about $250 million for relocation. Its a good investment in the long run. Most of the money is loans anyways. The Ice Edge clowns have no money.
It's really hard to believe that the BOG would allow RSE to put so little equity into the deal, lend them $85 million interest free and then allow them to sell for relocation and pocket the difference between their total losses over say the 5 years and your guesstimate of $250 million.

Either they've all lost their minds or LeBlanc got his hands upon some high resolution black and white photo's of ???

enarwpg is offline  
Old
07-13-2013, 08:36 PM
  #685
wunderpanda
don't get shutout
 
wunderpanda's Avatar
 
Join Date: Apr 2012
Posts: 4,369
vCash: 500
http://www.timescolonist.com/qualicu...yotes-1.523098

I wonder if each member of the ownership group will have little write ups such as this., Dutton seems nice enough. Article hasn't much insight into the sale tho

wunderpanda is offline  
Old
07-13-2013, 09:05 PM
  #686
OthmarAmmann
Omnishambles
 
OthmarAmmann's Avatar
 
Join Date: Jul 2010
Location: NYC
Posts: 2,757
vCash: 500
Quote:
Originally Posted by enarwpg View Post
It's really hard to believe that the BOG would allow RSE to put so little equity into the deal, lend them $85 million interest free and then allow them to sell for relocation and pocket the difference between their total losses over say the 5 years and your guesstimate of $250 million.

Either they've all lost their minds or LeBlanc got his hands upon some high resolution black and white photo's of ???
Yes, it turns out loans have to be repaid.

OthmarAmmann is offline  
Old
07-13-2013, 09:32 PM
  #687
Llama19
Registered User
 
Llama19's Avatar
 
Join Date: Jan 2013
Location: Outside GZ
Country: United States
Posts: 4,187
vCash: 91
Quote:
Originally Posted by wunderpanda View Post
http://www.timescolonist.com/qualicu...yotes-1.523098

I wonder if each member of the ownership group will have little write ups such as this., Dutton seems nice enough. Article hasn't much insight into the sale tho
If the Forbes article is accurate ($45M is RSE's 'share'), then this doesn't make cents*...

To quote:

"Dutton would not divulge how much money is involved but said “all 10 of us are in about equally.”"

Based on that statement, each is only 'buying in' at $4.5M.

* They are 'leasing' this team for pennies on the dollar.

Llama19 is offline  
Old
07-13-2013, 09:43 PM
  #688
Fugu
Administrator
HFBoards
 
Fugu's Avatar
 
Join Date: Nov 2004
Location: ϶(°o°)ϵ
Posts: 35,983
vCash: 500
Quote:
Originally Posted by Llama19 View Post
If the Forbes article is accurate ($45M is RSE's 'share'), then this doesn't make cents*...

To quote:

"Dutton would not divulge how much money is involved but said “all 10 of us are in about equally.”"

Based on that statement, each is only 'buying in' at $4.5M.

* They are 'leasing' this team for pennies on the dollar.
I think a G&M article said Gosbe was providing $35 MM.

Fugu is offline  
Old
07-13-2013, 10:02 PM
  #689
Llama19
Registered User
 
Llama19's Avatar
 
Join Date: Jan 2013
Location: Outside GZ
Country: United States
Posts: 4,187
vCash: 91
Quote:
Originally Posted by Fugu View Post
I think a G&M article said Gosbe was providing $35 MM.
To quote:

"While an NHL source said Gosbee is responsible for $35-million of the $45-million, with the other nine partners in for much smaller amounts, he said it is divided evenly among the group – although it does have two tiers of investors. He also said there is still considerable risk for the partners."

So, the other nine only have $1.1M each in equity?

Source: http://www.theglobeandmail.com/sport...ticle13130564/

And my city is expecting a 'make hole' (pun intended) promise?

Llama19 is offline  
Old
07-13-2013, 10:13 PM
  #690
Fugu
Administrator
HFBoards
 
Fugu's Avatar
 
Join Date: Nov 2004
Location: ϶(°o°)ϵ
Posts: 35,983
vCash: 500
Quote:
Originally Posted by Llama19 View Post
To quote:

"While an NHL source said Gosbee is responsible for $35-million of the $45-million, with the other nine partners in for much smaller amounts, he said it is divided evenly among the group – although it does have two tiers of investors. He also said there is still considerable risk for the partners."

So, the other nine only have $1.1M each in equity?

Source: http://www.theglobeandmail.com/sport...ticle13130564/

And my city is expecting a 'make hole' (pun intended) promise?

Yes, I've been assuming Gosbe is the only one with real skin in the game-- relatively speaking.

Fugu is offline  
Old
07-13-2013, 10:26 PM
  #691
Killion
Registered User
 
Killion's Avatar
 
Join Date: Feb 2010
Location: The Village
Country: Wales
Posts: 30,369
vCash: 500
Quote:
Originally Posted by Llama19 View Post
So, the other nine only have $1.1M each in equity?
Ya. Mindblowing aint it? But like George says, "dont confuse not having equity in being no risk".
Of course what he doesnt tell us is that he's not at risk at all, nor are the other 9 unit holders.

Killion is online now  
Old
07-13-2013, 10:28 PM
  #692
Revo
Registered User
 
Join Date: Jun 2011
Location: Quebec City
Country: Canada
Posts: 424
vCash: 500
Quote:
Originally Posted by mesamonster View Post
I`m not sure if i have this purchase price and all of the leverage mechanisms correct however, if RSE is forced to pay the COG $45MM, per their "Make Whole" agreement. Pay the league back the $80MM line of credit(assuming they tap it in its entirety) and pay Fortress the $120MM owed in principle. SHould they sell the team for $250MM it does not look like they will be making a dime?
After five years, with payments of 15M$ and 9% interest rate (that number was going around), the principal owed to Fortress will be less than 99M$. 85M$ with 5 years free of interest is a «gift» of (taking an easy 3% rate) more than 12,75M$ if it's at a normal interest rate, but I wouldn't be surprised the loan has other beneficial clauses for RSE. Still, at most 72,25M$ to repay to the NHL. That makes for at most 171,25M$ to repay after five years. I don't remember the language, but if the «make whole» agreement was up to (15-9)M$ in the first five, that still only makes a payment of 216,25M$. Someone should clarify, but I had the feeling it was up to 6M$ per year, for at most 30M$, making for a 201,25M$ amount to be repaid.

Then the «ideological» part comes into play: How high would be the losses that actually are covered by RSE, how is the 85M$ loan structured and how much can they sell the franchise for. So in other words, we (or anyway, I) don't know enough to be fully sure of anything... but it's not hard to imagine how RSE could actually turn a profit... considering how few of their own dollars they're (apparently) putting into this.

Revo is offline  
Old
07-13-2013, 10:28 PM
  #693
Retail1LO*
HFBoards Sponsor
 
Join Date: May 2006
Location: SE Pennsylvania
Country: United States
Posts: 6,613
vCash: 500
Send a message via ICQ to Retail1LO* Send a message via AIM to Retail1LO* Send a message via MSN to Retail1LO*
So...for $1M you can be part owner of an NHL franchise?

Christ...a handful of players could have bought that franchise. Kovalchuk could have bought it nearly twice with what he left on the table to retire.

Retail1LO* is offline  
Old
07-14-2013, 12:08 AM
  #694
Llama19
Registered User
 
Llama19's Avatar
 
Join Date: Jan 2013
Location: Outside GZ
Country: United States
Posts: 4,187
vCash: 91
Quote:
Originally Posted by Killion View Post
Ya. Mindblowing aint it? But like George says, "dont confuse not having equity in being no risk".
Of course what he doesnt tell us is that he's not at risk at all, nor are the other 9 unit holders.
Quote:
Originally Posted by Retail1LO View Post
So...for $1M you can be part owner of an NHL franchise?

Christ...a handful of players could have bought that franchise. Kovalchuk could have bought it nearly twice with what he left on the table to retire.
And to think...these Phoenix 'locals' could have been owners but we needed 'oil' men to buy this franchise...

Source: http://phoenix.about.com/cs/famous/a/wealthiest01.htm

Llama19 is offline  
Old
07-14-2013, 12:34 AM
  #695
Wheathead
Formally a McRib
 
Wheathead's Avatar
 
Join Date: Apr 2008
Location: Saskatoon
Country: Canada
Posts: 4,542
vCash: 500
Send a message via ICQ to Wheathead
Quote:
Originally Posted by Retail1LO View Post
So...for $1M you can be part owner of an NHL franchise?

Christ...a handful of players could have bought that franchise. Kovalchuk could have bought it nearly twice with what he left on the table to retire.
I wonder if any current players of the Coyotes (Shane Doan, perhaps) are investors at that price.

Wheathead is offline  
Old
07-14-2013, 12:39 AM
  #696
Killion
Registered User
 
Killion's Avatar
 
Join Date: Feb 2010
Location: The Village
Country: Wales
Posts: 30,369
vCash: 500
Quote:
Originally Posted by Scoobs View Post
I wonder if any current players of the Coyotes (Shane Doan, perhaps) are investors at that price.
Dunno whats goin on Scoobs. Simply doesnt make sense. It just seems so ridiculous. How on earth can you
can take this purchase seriously, these individuals as being in any way seriously committed? Its just incredible.

Killion is online now  
Old
07-14-2013, 01:05 AM
  #697
Wheathead
Formally a McRib
 
Wheathead's Avatar
 
Join Date: Apr 2008
Location: Saskatoon
Country: Canada
Posts: 4,542
vCash: 500
Send a message via ICQ to Wheathead
Quote:
Originally Posted by Killion View Post
Dunno whats goin on Scoobs. Simply doesnt make sense. It just seems so ridiculous. How on earth can you
can take this purchase seriously, these individuals as being in any way seriously committed? Its just incredible.
Honestly wouldn't surprise me if the purchase falls apart. We've been here before.

Wheathead is offline  
Old
07-14-2013, 02:03 AM
  #698
hisgirlfriday
Global Moderator
 
hisgirlfriday's Avatar
 
Join Date: Jun 2013
Posts: 16,885
vCash: 500
Quote:
Originally Posted by Scoobs View Post
I wonder if any current players of the Coyotes (Shane Doan, perhaps) are investors at that price.
There aren't any current players who are investors according to the Globe and Mail story with Gosbee's quotes.

http://www.theglobeandmail.com/sport...ticle13130564/

Quote:
The other partners are: Scott Saxberg, president of Crescent Point Energy Corp.; Craig Stewart, chairman of RMP Energy Inc.; Dave Duckett, president of Plains Midstream Canada; Peter Kagan, managing director of New York-based Warburg Pincus LLC; Bob Gwin, an executive with Anadarko Petroleum Corp. in Houston; George Fink, chairman of Bonterra Energy Corp.; and Bill Dutton, a retired Calgary oil man who is a descendant of the legendary Norman (Red) Dutton, a player, coach and owner in the NHL who served as its president in the 1940s.
Quote:
While an NHL source said Gosbee is responsible for $35-million of the $45-million, with the other nine partners in for much smaller amounts, he said it is divided evenly among the group – although it does have two tiers of investors. He also said there is still considerable risk for the partners.

hisgirlfriday is offline  
Old
07-14-2013, 02:06 AM
  #699
Killion
Registered User
 
Killion's Avatar
 
Join Date: Feb 2010
Location: The Village
Country: Wales
Posts: 30,369
vCash: 500
Quote:
Originally Posted by Retail1LO View Post
So...for $1M you can be part owner of an NHL franchise?
Apparently so. Has there ever been so highly a leveraged purchase anywhere, any league before? I cant think of one.... obviously some "Grand Play" is in motion. The thought that its a setup for eventual Relocation but one of several possible theories.


Last edited by Killion: 07-14-2013 at 10:19 AM.
Killion is online now  
Old
07-14-2013, 07:55 AM
  #700
howie789
Registered User
 
Join Date: Aug 2009
Posts: 80
vCash: 500
can't wait to see the NHL schedule for next year, and how many Saturday night games the Weasel gives the Coyotes. I wouldn't be surprised if its double what every other team is allotted, and watch most of them being the glamour teams- Chicago, Detroit, Rangers, Flyers, Bruins etc... sooner or later, its your team that should be the attraction, not the transplants road team, and it shouldn't matter what day of the week it is.

howie789 is offline  
Closed Thread

Forum Jump


Bookmarks

Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off



All times are GMT -5. The time now is 03:18 PM.

monitoring_string = "e4251c93e2ba248d29da988d93bf5144"

vBulletin Copyright ©2000 - 2016, Jelsoft Enterprises Ltd.
HFBoards.com is a property of CraveOnline Media, LLC, an Evolve Media, LLC company. ©2016 All Rights Reserved.