Part 2: True North Sports & Entertainment's efforts to acquire an NHL team (Winnipeg)

[dkehler]

The owners (NHL) can start courting potential owers whenever, just so long as they do not "consummate the deal" prior to the Dec 31.

That's my reading of the paragraph you posted as well (as it was when I first read it weeks ago). Looks to me like the NHL can all but finalize a deal before that date and subsequently consummate it on January 1, 2011.

The only reason why I think that probably won't happen (at least not publicly) is because they will want to avoid a nearly empty jobing.com Arena, but not because the deadline isn't really a deadline.

 

[RECCE]

That's my reading of the paragraph you posted as well (as it was when I first read it weeks ago). Looks to me like the NHL can all but finalize a deal before that date and subsequently consummate it on January 1, 2011.

The only reason why I think that probably won't happen (at least not publicly) is because they will want to avoid a nearly empty jobing.com Arena, but not because the deadline isn't really a deadline.

Agreed, on both points. Both para's discuss the fact that the NHL can doa deal either for a CoG sale or a deal to move the team just as long as it isn't consummated.
To add to that, I was just about to upload that part of the operations agreement.

 

[Puckschmuck*]

Ice Edge's Darryl Jones will be on Stop the Presses at 6 p.m (Winnipeg time). Listen at 92.9 Kick FM (a Winnipeg station).

This.................should....................be.......................interesting.

 

[MAROONSRoad]

Hmmmm...

Why not Phoenix?

Because Phoenix apparently already has a foot - or a skate - in the door in Winnipeg, the Manitoban capital that the former Jets deserted in the spring of 1996.

Link:

http://prohockeytalk.nbcsports.com/...ntial-teams-to-fill-new-quebec-city-arena.php

GHOST

 

[LT_Canadian]

Hmmmm...



Link:

http://prohockeytalk.nbcsports.com/...ntial-teams-to-fill-new-quebec-city-arena.php

GHOST

I want a team in Wpg as bad as anyone but we gotta give this up. There is a new rich man on the scene and he's going to close this deal in Phoenix. We are screwed. Then by the time the next team is available, Quebec will immediately jump ahead of us as the next best place to relocate. We're done like dinner.

 

[dkehler]

I want a team in Wpg as bad as anyone but we gotta give this up. There is a new rich man on the scene and he's going to close this deal in Phoenix. We are screwed. Then by the time the next team is available, Quebec will immediately jump ahead of us as the next best place to relocate. We're done like dinner.

I share your concerns, but I will keep hoping until a deal is signed, sealed and delivered. Perhaps both Winnipeg and Québec have an implied deal in place with Bettman and the NHL that they will be granted expansion franchises in 2 or three years if no other franchises relocate.

 

[Whileee]

I want a team in Wpg as bad as anyone but we gotta give this up. There is a new rich man on the scene and he's going to close this deal in Phoenix. We are screwed. Then by the time the next team is available, Quebec will immediately jump ahead of us as the next best place to relocate. We're done like dinner.

Why would Quebec jump ahead of Winnipeg on the NHL's list of priorities? Chipman and Thomson are a pretty formidable ownership group, and they have been absolutely in line with the NHL's approach so far. Tossing them under the bus to award a team to Quebec would be very bad form, and not in keeping with Bettman's vocal support for a return of the NHL to Winnipeg.

My thinking is that if it really is going to happen for either, then it will likely be both. In that case, I can see two possible scenarios:

1) 2011 or 2012 expansion to Wpg and Quebec.
2) 2011 Coyotes relocation to Winnipeg; 2012 expansion to Phoenix and Quebec.

Pure speculation, of course...

 

[cbcwpg]

Why would Quebec jump ahead of Winnipeg on the NHL's list of priorities? Chipman and Thomson are a pretty formidable ownership group, and they have been absolutely in line with the NHL's approach so far. Tossing them under the bus to award a team to Quebec would be very bad form, and not in keeping with Bettman's vocal support for a return of the NHL to Winnipeg.

My thinking is that if it really is going to happen for either, then it will likely be both. In that case, I can see two possible scenarios:

1) 2011 or 2012 expansion to Wpg and Quebec.
2) 2011 Coyotes relocation to Winnipeg; 2012 expansion to Phoenix and Quebec.

Pure speculation, of course...

Quebec will not jump ahead of Winnipeg. People think this whole Winnipeg getting a team back started because of the Phoenix BK, but that is not true. Chipman has been talking to the NHL about bringing a franchise to Winnipeg long before the Coyotes' troubles became public.

Chipman has also done the right things...

- Do what the NHL wants you to do ( filling papers, official requests )
- Don't negotiate in the papers ( no comment is the TNSE answer )
- Keep quite
- Don't ask for season ticket requests before getting a franchise ( re: Basillie )
- Don't get on Bettman's bad side

- And most importantly... Don't show the world you are an idiot by using twitter ( This is to you D. Jones of IEH )

 

[Whileee]

Quebec will not jump ahead of Winnipeg. People think this whole Winnipeg getting a team back started because of the Phoenix BK, but that is not true. Chipman has been talking to the NHL about bringing a franchise to Winnipeg long before the Coyotes' troubles became public.

Chipman has also done the right things...

- Do what the NHL wants you to do ( filling papers, official requests )
- Don't negotiate in the papers ( no comment is the TNSE answer )
- Keep quite
- Don't ask for season ticket requests before getting a franchise ( re: Basillie )
- Don't get on Bettman's bad side

- And most importantly... Don't show the world you are an idiot by using twitter ( This is to you D. Jones of IEH )

And yet, quite ironically, IEH (and DJ) might actually have at least part ownership of an NHL franchise before Chipman and Thomson (if the new ownership bid in Phoenix is successful). It speaks to the NHL's high level of interest in keeping a team in their current locales...

 

[cbcwpg]

And yet, quite ironically, IEH (and DJ) might actually have at least part ownership of an NHL franchise before Chipman and Thomson (if the new ownership bid in Phoenix is successful). It speaks to the NHL's high level of interest in keeping a team in their current locales...

It speaks to Bettman's high level of desperation to not be proven to have made a mistake.

 

[Fidel Astro]

Why would Quebec jump ahead of Winnipeg on the NHL's list of priorities? Chipman and Thomson are a pretty formidable ownership group, and they have been absolutely in line with the NHL's approach so far. Tossing them under the bus to award a team to Quebec would be very bad form, and not in keeping with Bettman's vocal support for a return of the NHL to Winnipeg.

My thinking is that if it really is going to happen for either, then it will likely be both. In that case, I can see two possible scenarios:

1) 2011 or 2012 expansion to Wpg and Quebec.
2) 2011 Coyotes relocation to Winnipeg; 2012 expansion to Phoenix and Quebec.

Pure speculation, of course...

The second half of number 2 doesn't make any sense.

If the Coyotes relocate to Winnipeg -- and I hope they do -- there's no way the NHL would award Phoenix another expansion team so soon, if at all.

 

[Whileee]

The second half of number 2 doesn't make any sense.

If the Coyotes relocate to Winnipeg -- and I hope they do -- there's no way the NHL would award Phoenix another expansion team so soon, if at all.

If the NHL really wants a team in Phoenix, then it would be more financially feasible to do so if the franchise cost was much less than the $165+ million that the NHL is compelled to charge to recoup its investment in sustaining the team for the past year.

 

[Wham City]

If the NHL really wants a team in Phoenix, then it would be more financially feasible to do so if the franchise cost was much less than the $165+ million that the NHL is compelled to charge to recoup its investment in sustaining the team for the past year.

Exactly. If Hulsizer gets to point where he can make an offer to the NHL it will be very telling if they budge on the 160M$ asking price.

 

[Whileee]

Exactly. If Hulsizer gets to point where he can make an offer to the NHL it will be very telling if they budge on the 160M$ asking price.

I highly doubt that the NHL will reduce the selling price. Otherwise, I would have expected them to do so to facilitate a deal with Reinsdorf. Besides, the NHL can't really set the precedent of buying teams high, absorbing operating losses for a year or more, and selling low to keep teams where they are. There would be a stampede from other owners to get a piece of that action.

 

[Wham City]

I highly doubt that the NHL will reduce the selling price. Otherwise, I would have expected them to do so to facilitate a deal with Reinsdorf. Besides, the NHL can't really set the precedent of buying teams high, absorbing operating losses for a year or more, and selling low to keep teams where they are. There would be a stampede from other owners to get a piece of that action.

I agree.

So maybe we should amend the assumption about the NHL wanting to keep a team in Phoenix to so long as they don't lose any money in the process.

The NHL is open to relocation it just has to be on their terms.

 

[GSC2k2*]

I highly doubt that the NHL will reduce the selling price. Otherwise, I would have expected them to do so to facilitate a deal with Reinsdorf. Besides, the NHL can't really set the precedent of buying teams high, absorbing operating losses for a year or more, and selling low to keep teams where they are. There would be a stampede from other owners to get a piece of that action.

Don't be ridiculous. Keep in mind what happened to the owner here. Moyes lost virtually all of his equity investment and is being sued on his personal guarantee (which personal guarantee is in place for every NHL team, BTW).

You are correct IMO that the NHL will not take a loss on the sale, but it is not for the reason you cited.

As an aside, this notion (propagated by you and Fugu, among others) that the sale price is going to be such an obstacle is IMO dreadfully wrongheaded. This NHL franchise is in any event going to be sold at a dramatic discount to other NHL franchises, thanks to the NHL having been the only party at the time willing to buy the asset on offer during the bankruptcy.

the issue of price is only relevant in terms of when the next purchaser decides to sell the franchise. Whether it is to another PHO purchaser or another city, that party is going to make back his equity investment. They only issue is how much it will impact borrowing costs, and that is not exactly a heck of a lot of money in the grand scheme. The asset is worth a lot more than $170M, plain and simple. Any attempts by a prospective purchaser will be shot down by the crafty guys at the NHL, who will point this out and dismiss such efforts at price reduction as the prospective purchaser simply being greedy.

 

[Wham City]

Don't be ridiculous. Keep in mind what happened to the owner here. Moyes lost virtually all of his equity investment and is being sued on his personal guarantee (which personal guarantee is in place for every NHL team, BTW).

You are correct IMO that the NHL will not take a loss on the sale, but it is not for the reason you cited.

As an aside, this notion (propagated by you and Fugu, among others) that the sale price is going to be such an obstacle is IMO dreadfully wrongheaded. This NHL franchise is in any event going to be sold at a dramatic discount to other NHL franchises, thanks to the NHL having been the only party at the time willing to buy the asset on offer during the bankruptcy.

the issue of price is only relevant in terms of when the next purchaser decides to sell the franchise. Whether it is to another PHO purchaser or another city, that party is going to make back his equity investment. They only issue is how much it will impact borrowing costs, and that is not exactly a heck of a lot of money in the grand scheme. The asset is worth a lot more than $170M, plain and simple. Any attempts by a prospective purchaser will be shot down by the crafty guys at the NHL, who will point this out and dismiss such efforts at price reduction as the prospective purchaser simply being greedy.

Dramatic discount? Relative to which franchise? Reports had Phoenix's sunbelt peer in Tampa going for less then a 100 million.

Is an NHL franchise worth 165M$ if you are free to move it anywhere you please, absolutely. I think it's still an open question if a buyer exists willing to spend 165M$ to be chained down in Glendale.

 

[GSC2k2*]

Dramatic discount? Relative to which franchise? Reports had Phoenix's sunbelt peer in Tampa going for less then a 100 million.

Is an NHL franchise worth 165M$ if you are free to move it anywhere you please, absolutely. I think it's still an open question if a buyer exists willing to spend 165M$ to be chained down in Glendale.

If you believe that TB sold for anything approaching $100M, I have nothing to say to you. It is nothing short of misreporting by a financially illiterate hockey writer.

 

[Wham City]

If you believe that TB sold for anything approaching $100M, I have nothing to say to you. It is nothing short of misreporting by a financially illiterate hockey writer.

Local TB media would argue otherwise. They list the price at 110M$ + control of the building and 5 1/2 acres of land. I don't think it's crazy to imagine the franchise standing alone was less then a 100M$.

http://www.tampabay.com/sports/hockey/lightning/article1071259.ece

 

[Whileee]

Don't be ridiculous. Keep in mind what happened to the owner here. Moyes lost virtually all of his equity investment and is being sued on his personal guarantee (which personal guarantee is in place for every NHL team, BTW).

You are correct IMO that the NHL will not take a loss on the sale, but it is not for the reason you cited.

As an aside, this notion (propagated by you and Fugu, among others) that the sale price is going to be such an obstacle is IMO dreadfully wrongheaded. This NHL franchise is in any event going to be sold at a dramatic discount to other NHL franchises, thanks to the NHL having been the only party at the time willing to buy the asset on offer during the bankruptcy.

the issue of price is only relevant in terms of when the next purchaser decides to sell the franchise. Whether it is to another PHO purchaser or another city, that party is going to make back his equity investment. They only issue is how much it will impact borrowing costs, and that is not exactly a heck of a lot of money in the grand scheme. The asset is worth a lot more than $170M, plain and simple. Any attempts by a prospective purchaser will be shot down by the crafty guys at the NHL, who will point this out and dismiss such efforts at price reduction as the prospective purchaser simply being greedy.

Please... do you really think that the purchase price is not an obstacle? Perhaps you could explain that to Reinsdorf, who thought that $103 million was about right, and insisted that others fund the remaining $65 million of the purchase price. If the purchase price was $103 million, my bet it that the team would already be owned by Reinsdorf. Do you disagree? Don't you think that IEH might have been much better able to put together financing for a $100 million purchase than a $165 million purchase? If the price is so good, where is the long line-up of owners to get the team at such a discount?

 

[Puckschmuck*]

I want a team in Wpg as bad as anyone but we gotta give this up. There is a new rich man on the scene and he's going to close this deal in Phoenix. We are screwed. Then by the time the next team is available, Quebec will immediately jump ahead of us as the next best place to relocate. We're done like dinner.

Why would Quebec jump ahead of us? They don't even have an arena built yet, and IMO, they still have to prove they want a team back as bad as Winnipeg does. I have yet to see any real rallies or gatherings from the good people of QC to show that there really is a passion for the NHL in Canada. And besides, the NHL has already stated that if a team was up for grabs, it should be offered to Winnipeg first. I don't believe that Chipman and Thomson would have spent the last few years making major investments (millions upon millions of dollars) in the downtown, and built a brand spanking new four-rink NHL calibre practice arena. I'm still of the belief that even if the Coyotes don't go through, there is some sort of agreement between TNSE and GB that the next team to relocate WILL go to Winnipeg and NOT QC. TSNE has a net worth higher than Quebecor; if you want to make money, you can't ignore these facts.

 

[GSC2k2*]

Please... do you really think that the purchase price is not an obstacle? Perhaps you could explain that to Reinsdorf, who thought that $103 million was about right, and insisted that others fund the remaining $65 million of the purchase price. If the purchase price was $103 million, my bet it that the team would already be owned by Reinsdorf. Do you disagree? Don't you think that IEH might have been much better able to put together financing for a $100 million purchase than a $165 million purchase? If the price is so good, where is the long line-up of owners to get the team at such a discount?

Yeah i do. You are drawing an apparent equivalence between the truism of "less purchase price = better" and the idea of it being an obstacle. They are not the same thing.

Everyone always likes a lower purchase price. No kidding! However, that does not equate to a particular price being an obstacle. A purchase price is an obstacle only if it is preventing the transaction from being completed - that is, if the price demanded is perceived to be more than what the asset is worth. There is not the slightest indication, apart from idle speculation by you and some others here (not even based on the usual bare proof of media reports, mind you) that price is an obstacle. JR was prepared to pay ~$150M in the summer of 2009, before he dropped out th efirst time. Same for IEH in the late summer and early fall. With the losses incurred since then, that is the equivalent of $170-175M now. The inherent value of the franchise is well established at this point.

This whole theorizing about price as an "obstacle" is completely unsupported.

 

[GSC2k2*]

Local TB media would argue otherwise. They list the price at 110M$ + control of the building and 5 1/2 acres of land. I don't think it's crazy to imagine the franchise standing alone was less then a 100M$.

http://www.tampabay.com/sports/hockey/lightning/article1071259.ece

Thanks, but i am familiar with what Cristodero wrote. Who do you think i was referring to with my post?

As well, you should probably read your media a little more closely:

for what is believed to be about $110 million.

Watch out for the well-worn media dodges.

 

[Whileee]

Yeah i do. You are drawing an apparent equivalence between the truism of "less purchase price = better" and the idea of it being an obstacle. They are not the same thing.

Everyone always likes a lower purchase price. No kidding! However, that does not equate to a particular price being an obstacle. A purchase price is an obstacle only if it is preventing the transaction from being completed - that is, if the price demanded is perceived to be more than what the asset is worth. There is not the slightest indication, apart from idle speculation by you and some others here (not even based on the usual bare proof of media reports, mind you) that price is an obstacle. JR was prepared to pay ~$150M in the summer of 2009, before he dropped out th efirst time. Same for IEH in the late summer and early fall. With the losses incurred since then, that is the equivalent of $170-175M now. The inherent value of the franchise is well established at this point.

This whole theorizing about price as an "obstacle" is completely unsupported.

So your position is that the purchase price is not one of the obstacles to concluding the sale of the Coyotes. And you offer as evidence the report the JR was prepared to pay $150 million in 2009 "before he dropped out". But you are not prepared to accept the evidence based on his 2010 MOU wherein his purchase price offer was $103 million, with $65 million financed by others.

You indicate that the inherent value of the franchise has been established by Reinsdorf's offer ($150 million), plus the losses incurred since then. Since when does an asset gain value by losing 17% of its value within one year? I would suggest that the purchase price is set by the NHL to be precisely related to their costs of purchase and operating the franchise, which for a host of reasons might not reflect the actual value.

 

[Wham City]

Thanks, but i am familiar with what Cristodero wrote. Who do you think i was referring to with my post?

As well, you should probably read your media a little more closely:



Watch out for the well-worn media dodges.

Thanks for the tip after squinting and looking real close it now reads

"for what is believed to be *$170 million*".

Magic Eyes ftw!

All one needs to do is observe the past 12 months concerning the sale of the Coyotes to see a statement like this is preposterous on it's face.

This NHL franchise is in any event going to be sold at a dramatic discount to other NHL franchises