NHL buyout offer gets second wind

[chiavsfan]

Want to know whis rogue league isn't being discussed? Because it is not feasable...look at what is happening with the WHA.

 

[MacDaddy TLC*]

Nothing. This an all or nothing offer folks.

I guess I misunderstood the sentence in the article where it states they were approaching teams individually.

 

[oil slick]

The 30 teams will not all want to sell their teams. All of this talk is purely PR IMO... Bettman wants to scare the PA a bit by showing an alternative future that would be ugly for them.

As for the rogue league, that is absurd IMO. Part of the reason that Bain feel they could run the league better than the NHL is currently being run is that they would be able to squash the powers that the union has now. Why would the NHLPA want to support this?

All this talk of rogue leagues is completely ridiculouse. There will not be a rogue league. The big arenas in virtually all the major NA markets are NHL arenas, and I just can't see anyone thinking building second arenas in cities is worth it given the vast quantities of cash the NHL is loosing. Maybe in Europe, but I've read enough about the dynamics you have over their to think a rival league will not develope any time soon.

 

[MacDaddy TLC*]

I'm sure the big market NHL teams will want to sell their clubs when the league is on the cusp of getting a terrific CBA which will increase the franchise values and profits.

Do you want to share something with us?

 

[mackdogs*]

Do you want to share something with us?

I call first dibs on his kool aid. No erasies.

 

[AM]

You have to understand....

The 30 teams will not all want to sell their teams. All of this talk is purely PR IMO... Bettman wants to scare the PA a bit by showing an alternative future that would be ugly for them.

As for the rogue league, that is absurd IMO. Part of the reason that Bain feel they could run the league better than the NHL is currently being run is that they would be able to squash the powers that the union has now. Why would the NHLPA want to support this?

All this talk of rogue leagues is completely ridiculouse. There will not be a rogue league. The big arenas in virtually all the major NA markets are NHL arenas, and I just can't see anyone thinking building second arenas in cities is worth it given the vast quantities of cash the NHL is loosing. Maybe in Europe, but I've read enough about the dynamics you have over their to think a rival league will not develope any time soon.

The NHLPA guys think black white and multicoloured rabbits pop out of hats, so anything is possible.

And even probable!

 

[kdb209]

I guess I misunderstood the sentence in the article where it states they were approaching teams individually.

Before, Bain was offering a big chunk of money to the league and letting the league decide how to split it up.

Now they are willing to negotiate directly with the teams to set a price, and it the total cumulative prices are within their (now maybe bumped up from $3.5B) budget, pull the trigger.

But still, any holdouts, no deal.

And again on the rediculous talk of Bain setting up a rival league - cut and pasted from an earlier post of mine when the Bain nonsense first came up:

Quote:
Originally Posted by JohnnyReb
Thats what the old NHL thought too. Didn't work that way. While the NHL eventually won out, as Conway points out, there were casualties.

Yes, but the WHA owners lost a A LOT more money than they cost the NHL. Not a great model to follow if you want to make money.

Quote:
Say Bain DID start a rival league. We know they are willing to spend $3.5 billion up front for a professional hockey league, how much would they be willing to spend to start up a league? Say a 10 team league, with a $55 million salary cap? Much better than the NHL's $35 million cap (not to mention the rookie and individual salary caps).

Why do you keep up this fiction that Bain has any interest in starting up a new league. They don't - they've said that themselves.

What do you think Bain is - a bunch of ego driven people who want to throw away money by starting a new professional sports league (a competing one at that), something that hasn't been successful in over 30 years - the AFL was the last real successful example (No I do not consider the old WHA one). No, Bain is an investment group which specializes in buying what they think are undervalued businesses that they think they can turn around. Just today it was anounced that they are part of the group that is buying Toys-R-Us for $6.6B dollars and taking it private. These are not people who start sports leagues for a lark.

Quote:
No, they aren't. But if Bain creates an atmosphere that forces NHL owners to sell... Say they buy out 10 NHL teams, and convince Toronto and New York to join them (not sell to them, but become partners with Bain). The NHL would be down 12 teams, including its two biggest revenue makers. Plus, they wouldn't have any arenas to play in, in Toronto and New York. Ruinous, for sure. How long will they hold out then, as Bain keeps waving that $3.5 billion stick in front of them? Why would they WANT to hold out? Most NHL owners are capitalists first, and fans second (if they are fans at all). If the situation isn't condusive to them making money, they'll bail.

They may not want to sell NOW, but if Bain takes over 1/3 of the league, the remaining owners may see the writing on the wall.

Bain has no interest in taking over any team or part of the league. There's was an all or nothing offer. Their business model can only work in a single owner league, and certainly not in a league with competition for players driving up costs.

And again I repeat, most of the teams are owned by private corporations, and there is no way to force them to sell. I suppose they can mount a hostile takeover of Comcast and the public corporation owned teams, but I doubt they have the hundreds of billions of dollars to do that.

I suppose they could throw enough money around to make an offer the owners couldn't pass up, but then they would have overpaid and be in a position where they would never recoup their investment.

Quote:
If Bain were to start a new league, I doubt they would be doing it for long term purposes. They would be doing it to force the NHL to sell to them (continuing with the hostile takeover theme). For example, with Toronto and New York on board, and say 8 other cities, they could probably bring in about $600 - $700 million in revenues. If Pittsburgh, with their lousy arena, lousy arena deal, lousy attendance, and lousy team, can bring in $52 million, I'm pretty sure Winnipeg could bring in $50 million as well. So the new league would put in a salary cap at say, $50-55 million, and start poaching players from the $35 million cap NHL. Will the new league make money in its first year, or first few years? No, of course not. But then again, neither do many other startup companies. $3.5 billion, up front. Do you think Bain expects to make that back in the first year? Of course not. They have a long term plan that would see them EVENTUALLY recuperating not only that initial $3.5 billion, but whatever losses they incur in the short term until they become profitable. In other words, they probably think it will take them 5-10 years to recoup the first $3.5 billion, and THEN start making money.In a new league, they could lose $500 million a year, and it would still take them 7 years to reach the money they were willing to spend up front to get the NHL.

Again with the "if Bain were to start a new league". Do you have any indication from anything Bain has said that they have any interest in starting a new league.

Your whole scenerio is a pipedream with no sane business plan to support it.

Quote:
So what does the NHL do, if faced with a league with a $55 million cap per team? Do they match it? Or do they watch as the Crosbys, Ovechkins, Malkins, Kovalchouks and Lecavaliers depart for richer pastures? Faced with such a situation, more and more owners will probably bail, and take whatever money Bain offers them. Corporate mergers happen all the time, because its better to be together, than competing against one another. Heck, its how Edmonton got into the NHL, after all. Once that happens, Bain can recover the NHL name and logos, and the Stanley Cup, and become the sole owner of the NHL, as they apparently want to be.

They dont care, because this insane pipedream of a BHL (Bain Hockey League) exists only in your confused mind.

Quote:
Apparently they have it, and reports are they were willing to go higher than $3.5 billion, so...

Maybe they will, but it will still be an all or nothing offer for the NHL and not a rival league. They are a takeover investment group. They can get a much better return on thier money than by trying to start a rival league.

As the WHA learned - how do you make a small fortune running a rival league - start with a big one.


Now maybe some crazed Russian Billionaire may come over and try to spend his money before the Kremlin steals it back, or Bill Gates may wake up one morning and decide he wants a new toy (Damn, Paul has those sports teams, I know, I'll show him up by owning a whole sports league), or aliens may show up with billions of credits and an intergalactic TV deal, but unless something equally likely happens, there will be no real credible hockey league formed to compete with the NHL.

 

[Hire Sather]

I again remind everyone in favor of this that this will kill the game, totally.

 

[Hemsky4PM]

Maybe they could negotiate a percentage of "league" ownership share with individual teams that don't want to sell. For instance could they offer MLSE/OTPF a stake in the league based on their relative market value? Same goes for the Dolan in NY and Snyder in Philly. Maybe this group would be willing to partner up with some of the deep pocketed owners? I'm not a business expert so if anyone can tell me if there is no chance of this, hit me.

 

[shakes]

Do you want to share something with us?

Everyone knows a salary cap is coming. Let's just say it's 40 million. I'm pretty sure the Leafs made around 15-20 million last year with a 60-70 million dollar payroll in place. Even with my limited math abilities I can see that that's an extra 20-30 million in the Teacher's Pension Plan coffers.

 

[Buffaloed]

Bain Capital Partners LLC and Game Plan International are the financiers behind the WHA. What we're seeing here is a squeeze play being put on the NHL. Pressure is being applied from the bottom by the threat of the WHA and pressure is applied from the top with the buyout offer. The buyout offer is designed to sow dissention among NHL owners. It's in Bain's interest that there be no NHL hockey next season. The net result is that it depresses the value of the NHL and makes their offer more atttractive. If their offer isn't accepted it makes their WHA more viable. It's a win-win if they can drive a wedge between the various NHL owners. It wouldn't surprise me if the Devils controlling partner will get a big piece of the pie if the bid is successful. I have no doubt that Bain is trying to compromise other owners with secret inducements. Given enough time and dysfunctionality by the NHL, they may succeed in swaying enough owners to back the bid. This isn't a CBA where Bettman has 75% veto power. The NHL should address this by coming out with their own plan to reorganize into a single ownership. The existance of such a plan will mollify those owners looking to sell out and induce the NHLPA to agree to an NHL-friendly CBA. Bain Capital is the enemy. They're firing warning shots across the bow, and should not be underestimated. The league needs to fire back.

 

[Roots73]

As a hockey fan, I'm not down with the idea of having one owner for 30 NHL teams. As many have said before, it smacks of WWF/E. Could any fan trust the results of a league that is monopolized by one owner??

Wouldn't the owner of such a group just have the Maple Leafs versus the Red Wings play every year for the Stanley Cup because it will offer up the best formula of ratings and revenues. The spectre of "The Fix" is too great here.

Just a side note. If the league is looking at this as a way of circumventing the need for a player's union, could it be possible for the Bain group to just purchase controlling interest or "majority share holder" status in franchises like TML to allow the league to dump the players union?? That way the Teacher's Pension group can still have their slice of the pie while Bain has a stake in the Leafs franchise and the ability to force the union out of the league.

Can something like this be possible??

 

[clefty]

I again remind everyone in favor of this that this will kill the game, totally.

Likewise.

 

[Johnnybegood13]

Everyone knows a salary cap is coming. Let's just say it's 40 million. I'm pretty sure the Leafs made around 15-20 million last year with a 60-70 million dollar payroll in place. Even with my limited math abilities I can see that that's an extra 20-30 million in the Teacher's Pension Plan coffers.

And your point is? God forgive those who invest millions and actually make a profit for doing it!

 

[kdb209]

Bain Capital Partners LLC and Game Plan International are the financiers behind the WHA. What we're seeing here is a squeeze play being put on the NHL. Pressure is being applied from the bottom by the threat of the WHA and pressure is applied from the top with the buyout offer. The buyout offer is designed to sow dissention among NHL owners. It's in Bain's interest that there be no NHL hockey next season. The net result is that it depresses the value of the NHL and makes their offer more atttractive. If their offer isn't accepted it makes their WHA more viable. It's a win-win if they can drive a wedge between the various NHL owners. It wouldn't surprise me if the Devils controlling partner will get a big piece of the pie if the bid is successful. I have no doubt that Bain is trying to compromise other owners with secret inducements. Given enough time and dysfunctionality by the NHL, they may succeed in swaying enough owners to back the bid. This isn't a CBA where Bettman has 75% veto power. The NHL should address this by coming out with their own plan to reorganize into a single ownership. The existance of such a plan will mollify those owners looking to sell out and induce the NHLPA to agree to an NHL-friendly CBA. Bain Capital is the enemy. They're firing warning shots across the bow, and should not be underestimated. The league needs to fire back.

If you can give me one credible source that says Bain has anything whatsoever to do with the WHA, I'll eat my shorts.

Bain Capital is a venture capital and leveraged buyout investment firm. They get involved in deals like the $6.4B buyout of Toys-R-Us and this weeks $11B LBO of SunGard. They would have absolutely no interest in something like the WHA, with so much risk and little upside. They specialize in buying existing companies with underutilized assets where they see profit. I can see their interest in the NHL, but none whatsoever in a competing league.

 

[kdb209]

Quote:
Originally Posted by Buffaloed
Bain Capital Partners LLC and Game Plan International are the financiers behind the WHA. What we're seeing here is a squeeze play being put on the NHL. Pressure is being applied from the bottom by the threat of the WHA and pressure is applied from the top with the buyout offer. The buyout offer is designed to sow dissention among NHL owners. It's in Bain's interest that there be no NHL hockey next season. The net result is that it depresses the value of the NHL and makes their offer more atttractive. If their offer isn't accepted it makes their WHA more viable. It's a win-win if they can drive a wedge between the various NHL owners. It wouldn't surprise me if the Devils controlling partner will get a big piece of the pie if the bid is successful. I have no doubt that Bain is trying to compromise other owners with secret inducements. Given enough time and dysfunctionality by the NHL, they may succeed in swaying enough owners to back the bid. This isn't a CBA where Bettman has 75% veto power. The NHL should address this by coming out with their own plan to reorganize into a single ownership. The existance of such a plan will mollify those owners looking to sell out and induce the NHLPA to agree to an NHL-friendly CBA. Bain Capital is the enemy. They're firing warning shots across the bow, and should not be underestimated. The league needs to fire back.

If you can give me one credible source that says Bain has anything whatsoever to do with the WHA, I'll eat my shorts.

Bain Capital is a venture capital and leveraged buyout investment firm. They get involved in deals like the $6.4B buyout of Toys-R-Us and this weeks $11B LBO of SunGard. They would have absolutely no interest in something like the WHA, with so much risk and little upside. They specialize in buying existing companies with underutilized assets where they see profit. I can see their interest in the NHL, but none whatsoever in a competing league.

I hate to follow up on my own posts, but the WHA site itself has no mention of Bain - just a news release mentioning that an anonymous group of Eastern European investors was interested in buying 49% of the league. You'd think that if such a high profile investor group as Bain were involved, the WHA would be trumpeting it from all quarters.

And a google search for any connection between Bain and the WHA only yields one (Russ Conway's oft quoted article):

The second group, based in Boston, involves lawyer Bob Caporale, former New England Patriots star Randy Vataha, and Bain Capital, the multi-billion dollar investment company founded by Massachusetts Gov. Mitt Romney.

It's no secret Bain offered $3.5 billion to the NHL's board of governors to buy the entire league -- all 30 clubs -- only to be politely shown the door.

This high-roller bunch isn't done yet.

Caporale is no stranger to the ins and outs of pro hockey or interleague competition. Back in the 1970s, he was involved with what became the NHL's biggest "modern era" nemesis, the old WHA. He was one of the architects who put together the NHL-WHA "merger" agreement in 1979.

So yes, Bain does have a connection to the WHA - the old WHA of the 70s, not today's incarnation.

So again, give me one shred of evidence that Bain has anything to do with the current WHA.

 

[mr gib]

Except when it counts.

maybe in 06

 

[mr gib]

What dig at the players was there in that article?

" The idea, in part, is to eliminate the player-bidding wars that have driven teams into bankruptcy, darkened at least one season and triggered hundreds of millions in losses. "

 

[MacDaddy TLC*]

Everyone knows a salary cap is coming. Let's just say it's 40 million. I'm pretty sure the Leafs made around 15-20 million last year with a 60-70 million dollar payroll in place. Even with my limited math abilities I can see that that's an extra 20-30 million in the Teacher's Pension Plan coffers.

Actually, the Leafs made 17 million dollars MORE than the team that made the second most in revenue. And yes, the OTPF makes me sick!

 

[nyrmessier011]

This is cool. This is what we discussed in the previous thread. What if they manage to buy 22-24 teams?

There's pros and cons of this buyout, but one of the pro's I see is that they definetly will contract teams. If this buyout happens, look for 22-24 teams to exist

 

[djhn579]

" The idea, in part, is to eliminate the player-bidding wars that have driven teams into bankruptcy, darkened at least one season and triggered hundreds of millions in losses. "

It's kind of a stretch to call this a dig at the players. The author does not say anything in this quote is the fault of the players and the everything in the quote applies just as much to the owners as the players...

 

[Schlep Rock]

Want to know whis rogue league isn't being discussed? Because it is not feasable...look at what is happening with the WHA.

A "rogue league" is being discussed.

 

[Lanny MacDonald*]

A "rogue league" is being discussed.

Yes, and has been for years. So when do we finally get to see some "meaningful" action on the "discussion". You know, like a commitment of money to building leases and contracting of players? Until some serious moves where a long term contract is made its nothing but "discussion".

 

[Schlep Rock]

Yes, and has been for years. So when do we finally get to see some "meaningful" action on the "discussion". You know, like a commitment of money to building leases and contracting of players? Until some serious moves where a long term contract is made its nothing but "discussion".

You are correct, it is nothing but discussion but the previous poster tried to claim a rogue league isn't even being discussed.

To quote Henry Kissinger, "Every great achievement was a dream until someone of vision turned it into a reality."

And to the poster who said that Bain Capital would never fund a new league, etc., etc. unless you are from Bain Capital, you can't say for sure. It's interesting they were founded by Mitt Romney though, I never knew that.

 

[AM]

sure...

You are correct, it is nothing but discussion but the previous poster tried to claim a rogue league isn't even being discussed.

To quote Henry Kissinger, "Every great achievement was a dream until someone of vision turned it into a reality."

And to the poster who said that Bain Capital would never fund a new league, etc., etc. unless you are from Bain Capital, you can't say for sure. It's interesting they were founded by Mitt Romney though, I never knew that.

but what is the vision?

....I want to spend all my money making hockey players rich!!

Not to engaging for the majority of investors I'd warrant.