Inactive Franchise.

[tarheelhockey]

I'm not up to date on my hockey business news. Is this a rumored scenario? Team moves to Utah as a new franchise, perhaps pays the league an expansion fee. Meruelo holds ownership of the existing Arizona franchise with a chance to come back without paying an expansion fee?

cheers

There seem to be conflicting versions going around. What I’ve seen (if I understand correctly) is that Meruelo sells the Coyotes’ hockey operations back to the league for $1B, and Smith then buys that element from the league for $1B. Meruelo will continue to own the franchise’s business operations to lay the groundwork for a future Coyotes team. In a few years, if the pieces fall into place for a new arena, Meruelo would then be granted an “expansion franchise” and return the $1B to the NHL.

What’s peculiar about the situation, and what OP is honing in on, is that the “franchise” is ordinarily identified as the business entity which defines the organization on paper. You can fire your whole front office and trade all your players, move arenas, change your logo, get rid of the mascot, and still have the same franchise in place (just not the same team!). In this situation, Meruelo appears to be holding on to the Coyotes franchise, which becomes inactive. SLC would be an expansion franchise, to which the Coyotes’ assets are being transferred as part of the $1B franchise purchase. BUT, the exact same reports are suggesting that Meruelo is going to be given an “expansion franchise” in the future. So either there are aspects of the situation being misreported, or the NHL is breaking some new ground in terms of how it handles franchise status.