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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, NHL revenues, relocation and expansion.

Balsillie/Phoenix part IV

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Old
05-22-2009, 06:17 PM
  #76
Bitterman
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Originally Posted by KevFu View Post
Yeah, the PR effect is a massive factor. The Sabres don't want to lose those fans, period. Their response must be crafted carefully. If the Hamilton Coyotes fall through, the Sabres would be extremely wise to offer some kind of pro-Canadian fan incentives.
Incentives? I can't imagine Buffalo being able to do anything that would appease fans who lost a chance to get an NHL franchise. For a reasonable price, Buffalo can be bought. The Leafs on the other hand will fight it tooth and nail to maintain their monopoly on the 5th largest market in North America.

As for other locations in SO, none of them have anything close to an NHL sized arena.

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05-22-2009, 06:18 PM
  #77
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Originally Posted by Northern Dancer View Post
Why can't people see the ridiculouness of this and the entire Balsillie soap opera?



I think the Blue Jays should move to New York and get the exact same TV deal deal as the Yankees. Whoops, forgot to add the City should build them a new stadium as well!!


Brooklyn

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05-22-2009, 06:21 PM
  #78
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Originally Posted by Bitterman View Post
Incentives? I can't imagine Buffalo being able to do anything that would appease fans who lost a chance to get an NHL franchise. For a reasonable price, Buffalo can be bought. The Leafs on the other hand will fight it tooth and nail to maintain their monopoly on the 5th largest market in North America.

As for other locations in SO, none of them have anything close to an NHL sized arena.
They will but they will cave in the end. It is all about money and a cheque for 100 million should appease them. (if that sounds ridicuclous I believe it was Ron Joyce who was going for an expansion team in Hamilton when Ottawa and Tampa came into the League had agreed to 50 million to Toronto and 50 million to Buffalo back in 1992)

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05-22-2009, 06:23 PM
  #79
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Originally Posted by leek View Post
If a buyer believes they can make it work and is willing to put up the money to do it, AND the court and the NHL agree, then it's their business.
Yeah... it's their business, but don't we as fans want to see a successful on-ice product, league-wide? Surely for that to exist, teams have to be pulling a profit.

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05-22-2009, 06:24 PM
  #80
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Originally Posted by mouser View Post
It is 6.2(b)(iv):


In court the judge asked Balsillie's lawyer exactly what this meant and the lawyer responded that it meant among other things that the team had to receive broadcasting rights in the [Ontario] region equivalent to the Maple Leafs.

edit: obviously Art's a faster typist
I think alot of people misunderstand the point with Art's wording (yours is better). What he is saying is that he wants the same broadcast area as Toronto, not the same amount of $ for the TV contract (which he obv won't get).

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05-22-2009, 06:25 PM
  #81
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Originally Posted by leek View Post
terms and conditions no less favorable than those currently enjoyed by the Toronto Maple Leafs. In court, PSE's attorney included TV rights in those terms. In court, Judge informied PSE/Balsillie he's doubtful court has authority to enforce the the requirement in Balsillie bid that the team have rights "no less advantageous than the Maple Leafs" after relocation.


http://www.hfboards.com/showthread.p...3#post19626103
Exactly. JB's lawyer explained, to paraphrase "if we find out that the networks in Canada won't give us the same tv deal the leafs have" the APA cannot stand.

Thats when Judge Baum explained that he believed he lacked jurisidction to make a non-party like the Toronto Maple Leafs do anything. Plus, the Judge explained that he thought nothing wrong with the Leafs enjoying a better tv or arena lease deal analogizing it to his experience with his former law firm: "The old guys got a better deal than the new guys. That's just the way it was."

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05-22-2009, 06:25 PM
  #82
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Originally Posted by Jake16 View Post
Yes Judge Baum already said he will not issue any order that provides that the purchaser/team in Hamilton would have conditions "no less advantageous than those currently enjoyed by the Toronto Maple Leafs." That Clause, which appears on page 23 of the Asset Purchase Agreement was already turned down when JB's or Moyes's lawyer (If forget if it was Lisa Freeman or Tom Solerno) asked that it be included in the Bankrupcy auction notice. Judge said the Leafs aren't in court and he can't make them do anything. So if that's a material term of JB's offer, its already dead. Not that he can't make another revised offer doen the road.
As I thought, the judge refused to hear any arguments about elements outside his jurisdiction. JB can shoot for the moon as the buyer but Moyes nor the Bankruptcy court are in a position to agree with any terms outside the Yotes current market boundaries.

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05-22-2009, 06:28 PM
  #83
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So this ends on June 22nd right? That's what I heard the main decision a month from now.

If not someone want to give me a small timeline if they would be so kind.

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05-22-2009, 06:29 PM
  #84
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Originally Posted by Northern Dancer View Post
They will but they will cave in the end. It is all about money and a cheque for 100 million should appease them. (if that sounds ridicuclous I believe it was Ron Joyce who was going for an expansion team in Hamilton when Ottawa and Tampa came into the League had agreed to 50 million to Toronto and 50 million to Buffalo back in 1992)
The issue here is that Ballsillie is trying to use the bankruptcy court to prevent the Leaf from collecting any territorial fees. The judge initially said he doesn't have jurisdiction to rule there.

Will JB still buy the Coyotes if he has to pay Toronto? I have no idea and not enough info to speculate.

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05-22-2009, 06:30 PM
  #85
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Originally Posted by Egil View Post
I think alot of people misunderstand the point with Art's wording (yours is better). What he is saying is that he wants the same broadcast area as Toronto, not the same amount of $ for the TV contract (which he obv won't get).
I'm not sure it was limited to that. In thought I heard her (Lisa Freeman, JB's/PSE's lawyer) say something along the lines of: 'we can't get there and then find out that the Canadian tv stations won't give us the same tv broadcasting time as the Leafs have" - meaning they wanted to make sure just about everything was the same as the Leafs, including the ability to have all 82 games broadcast for equal revenue.

The judge wasn't going with her on this (see my post above), so it did not get as far down that road or into the particular details enough for JB's lawyer to provide more specifics say like, that the Hamilton team needed to be the lead game on HNIC just as often as the Leafs are.

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05-22-2009, 06:31 PM
  #86
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Originally Posted by Art.Vandelay View Post
The issue here is that Ballsillie is trying to use the bankruptcy court to prevent the Leaf from collecting any territorial fees. The judge initially said he doesn't have jurisdiction to rule there.

Will JB still buy the Coyotes if he has to pay Toronto? I have no idea and not enough info to speculate.
Yes, but he would pay Phoenix's creditors less. He is also surely willing to go higher than $212.5 mil, but exactly how high is unknown.

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05-22-2009, 06:32 PM
  #87
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Originally Posted by Macke View Post
So this ends on June 22nd right? That's what I heard the main decision a month from now.

If not someone want to give me a small timeline if they would be so kind.
The judge is going to hear oral arguements on the relocation issue on June 22. I don't recall him giving an indication that he would rule on that day.

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05-22-2009, 06:32 PM
  #88
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Incentives? I can't imagine Buffalo being able to do anything that would appease fans who lost a chance to get an NHL franchise.
Yeah, but this argument doesn't really hold water.

Any fans that would boycott the Sabres for blocking a Hamilton franchise are people who are eager to become fans of that Hamilton franchise if it ever materializes, and so don't represent business for the Sabres in either event. People who are so eager to become fans of a new Hamilton team that they would boycott Buffalo for blocking it, probably aren't Sabres fans to begin with.

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05-22-2009, 06:34 PM
  #89
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Originally Posted by Egil View Post
Yes, but he would pay Phoenix's creditors less. He is also surely willing to go higher than $212.5 mil, but exactly how high is unknown.
The $212.5 is for the purchase of the team only. All those proceeds will go to the creditors. If he has to pay any territorial rights to Toronto or Buffalo that is a separate matter above and beyond.

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05-22-2009, 06:34 PM
  #90
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Originally Posted by Art.Vandelay View Post
The issue here is that Ballsillie is trying to use the bankruptcy court to prevent the Leaf from collecting any territorial fees. The judge initially said he doesn't have jurisdiction to rule there.

Will JB still buy the Coyotes if he has to pay Toronto? I have no idea and not enough info to speculate.
Well if he had to come in the front door, pay teritorial fees to Buffalo and Toronto and build his own rink I would suggest that the franchise would be a complete financial disaster and he knows this. He has already got (apparantly) the City of Hamilton to subsidize the Copps improvements for 120 million. If he can get away with paying no territorial fees then his 212 million dollar purchase is the business coup of the century but I have a sneaky idea he will not make it out of the starting gate without paying both Toronto and Buffalo. (and I think deep down he knows that as well)

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05-22-2009, 06:39 PM
  #91
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Originally Posted by Jake16 View Post
I'm not sure it was limited to that. In thought I heard her (Lisa Freeman, JB's/PSE's lawyer) say something along the lines of: 'we can't get there and then find out that the Canadian tv stations won't give us the same tv broadcasting time as the Leafs have" - meaning they wanted to make sure just about everything was the same as the Leafs, including the ability to have all 82 games broadcast for equal revenue.

The judge wasn't going with her on this (see my post above), so it did not get as far down that road or into the particular details enough for JB's lawyer to provide more specifics say like, that the Hamilton team needed to be the lead game on HNIC just as often as the Leafs are.
No judge anywhere can order the CBC to nationally broadcast anything. My understanding is that they don't want regional limits (blackouts) on whatever broadcast deal they eventually work out or even worse, no broadcast deal at all because the Leafs demand exclusivity on their current broadcast contracts. If anyone goes to court over broadcast rights it'll be Hamilton suing the Leafs directly.

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05-22-2009, 06:44 PM
  #92
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Originally Posted by Jake16 View Post
I'm not sure it was limited to that. In thought I heard her (Lisa Freeman, JB's/PSE's lawyer) say something along the lines of: 'we can't get there and then find out that the Canadian tv stations won't give us the same tv broadcasting time as the Leafs have" - meaning they wanted to make sure just about everything was the same as the Leafs, including the ability to have all 82 games broadcast for equal revenue.

The judge wasn't going with her on this (see my post above), so it did not get as far down that road or into the particular details enough for JB's lawyer to provide more specifics say like, that the Hamilton team needed to be the lead game on HNIC just as often as the Leafs are.
HNIC is national, so that has 0 bearing. I can't imagine him arguing that he needs the same amount of money, as that requires forcing TSN/Sportsnet into a contract, which is a clear non-starter.

So, to take a step back, Toronto used to be able to show their games in all of Ontario (and possibly all of Canada Ontario-East). When Ottawa joined the league, they got a chunk of Ontario for their TV rights, and offered to trade Ottawa-East for the rest of Ontario. They made a similar offer to the Habs. The Leafs refused to deal, so Sens games are shown in Ottawa and East, Leafs games in the rest of Ontario. On the other hand, the Habs did agree.

With that in hand, and with TV rights being very important to any potential franchise, I don't see how the point wasn't to guarantee full access to the Toronto market in terms of TV. It didn't seem like this went very far before the judge changed gears, but with the background, I can't imagine it is anything but wanting guaranteed access.

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05-22-2009, 06:45 PM
  #93
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Originally Posted by Northern Dancer View Post
Well if he had to come in the front door, pay teritorial fees to Buffalo and Toronto and build his own rink I would suggest that the franchise would be a complete financial disaster and he knows this. He has already got (apparantly) the City of Hamilton to subsidize the Copps improvements for 120 million. If he can get away with paying no territorial fees then his 212 million dollar purchase is the business coup of the century but I have a sneaky idea he will not make it out of the starting gate without paying both Toronto and Buffalo. (and I think deep down he knows that as well)
Do you guys really think a team is going to come into the greater Toronto area, home of one of the most valuable and profitable sports franchises in the world, and not have to pay the Leafs or the league a cent???

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05-22-2009, 06:45 PM
  #94
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Originally Posted by Art.Vandelay View Post
The $212.5 is for the purchase of the team only. All those proceeds will go to the creditors. If he has to pay any territorial rights to Toronto or Buffalo that is a separate matter above and beyond.
With all sorts of provisions based on hoped for rulings. If he needs to shell out a ton of money to the Leafs, then that violates his current offer, and a new one would be prepared. And the new one doesn't need to provide $212.5 mil to Phoenix's creditors.

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05-22-2009, 06:46 PM
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Do you guys really think a team is going to come into the greater Toronto area, home of one of the most valuable and profitable sports franchises in the world, and not have to pay the Leafs or the league a cent???
Im pretty sure Balsille would be happy if he was given a number that he has to pay. As of right now, that number seems to be infinity.

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05-22-2009, 06:51 PM
  #96
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Originally Posted by HockeyScholar View Post
Honest question:

What is the logical reason for keeping a hockey team in Phoenix?

Points to consider:
-lost 40 million dollars last year according to the commissioner
-averaged 8000 people per game on their television broadcasts

The old argument was that we need Phoenix for that mythical ESPN deal. Well that is obviously false now that we've seen the numbers.

Enlighten me.
The reason the team loses so much money is that they have a terrible lease for Jobing.com Arena (Horrible name for an Arena). No parking fees etc. I'm assuming if a new owner comes in the lease will be renegotiated, otherwise I don't see anyone buy this team from Glendale.

Best case scenario for Balsillie is that they approve the sale and then the NHL will be forced to deal with relocation. I see something where the court grants the NHL a year to find a new owner with a better deal than Balsillie or Balsillie gets the team. The NHL will be foolish to block the move after all this, just wouldn't be good business.

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05-22-2009, 06:52 PM
  #97
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Originally Posted by Egil View Post
With all sorts of provisions based on hoped for rulings. If he needs to shell out a ton of money to the Leafs, then that violates his current offer, and a new one would be prepared. And the new one doesn't need to provide $212.5 mil to Phoenix's creditors.
Yes, he can pull the current offer and make a lower bid. But in the auction process, the judge is going to review all submitted bids and decide which one best suits the creditors. If someone submits a better offer, they get the team.

Something that I think is getting lost here. The June 22 decision is not whether JB can buy the Coyotes, but whether they can be relocated against the wishes of the NHL. Once these issues are resolved, the auction process starts. If the judge does say the team can be moved, there's nothing to stop someone from bidding higher than JB and moving the team anywhere they want.

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05-22-2009, 06:54 PM
  #98
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Do you guys really think a team is going to come into the greater Toronto area, home of one of the most valuable and profitable sports franchises in the world, and not have to pay the Leafs or the league a cent???
Absolutely not and I think 29 other owners would back the Leaf/Sabres on this as each team has a vested interest in protecting their own market.

NYI paid NYR
NJD paid NYR, NYI and even PHilly Flyers
Anaheim paid L.A. Kings

and as I mentioned earlier Hamilton had agreed to pay both Toronto and Buffalo when they applied for an expansion team back in 1992 (Ottawa and Tampa Bay got in instead)

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05-22-2009, 06:55 PM
  #99
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Originally Posted by Egil View Post
HNIC is national, so that has 0 bearing. I can't imagine him arguing that he needs the same amount of money, as that requires forcing TSN/Sportsnet into a contract, which is a clear non-starter.

So, to take a step back, Toronto used to be able to show their games in all of Ontario (and possibly all of Canada Ontario-East). When Ottawa joined the league, they got a chunk of Ontario for their TV rights, and offered to trade Ottawa-East for the rest of Ontario. They made a similar offer to the Habs. The Leafs refused to deal, so Sens games are shown in Ottawa and East, Leafs games in the rest of Ontario. On the other hand, the Habs did agree.

With that in hand, and with TV rights being very important to any potential franchise, I don't see how the point wasn't to guarantee full access to the Toronto market in terms of TV. It didn't seem like this went very far before the judge changed gears, but with the background, I can't imagine it is anything but wanting guaranteed access.
Certainly the language in the clause on page 23 of the APA is not drafted so narrowly.

As it stands right now, the Conditions in his conditional APA are not being satisfied. Besides these, the condition in the APA that the sale by auction be finalized by June 29 is certainly not going to happen.

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05-22-2009, 06:57 PM
  #100
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Back away slowly, Mr. Breslow

http://www.edmontonsun.com/sports/ho...32476-sun.html

Quote:
The real short-term problem for the NHL in all of this is time. The bankruptcy court doesn't really concern itself with the urgency of the NHL's business. The NHL, though, has to be very concerned.

They will try, against any better judgment, to keep the franchise in Phoenix, which really, only delays the inevitable. In fact, this war has gotten so out of hand that the NHL may choose to lose more money rather than to allow Jim Balsillie to play in their sandbox.

What would make sense is to suspend the Phoenix operation, disperse their players elsewhere and announce you will be accepting bids for an NHL expansion franchise in southern Ontario for the following season.

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