Andrew Barroway to buy 51% of the Coyotes (Done, Pending BOG Approval)

[TheLegend]

the post might not be great but werent they the ones who first ferreted out the wang sale non sale/re-sale ?

the article by brooks seems ( and I agree this is the operative word) to have a lot more meat in it than a lot of the random speculation ive seen.

Even a broken clock is right twice a day.

So far you have one report.... and now the social media is kicking into gear with other media outlets doing nothing more than parroting the Post.

If..... the story becomes true then everyone can start guessing why this transaction is happening.

Edit: Craig Morgan from Fox Sports AZ is following up on the story as I type so we'll see what develops.

 

[Confucius]

I guess that rogers tv money boosted the value of the teams. Not to mention Bettmans claim of 1.4 billion for 4 teams was not nearly enough.

If Phoenix goes for 300 million Seattle and Quebec have to be 500 mm plus

 

[Dolemite]

(Insert Coyotes ownership circus music here)

 

[gstommylee]

Wonder IF he buys, will he be obligated by the same opt-out clauses, or will he get to negotiate new terms.

Most likely same opt-out clause.

 

[gstommylee]

I guess that rogers tv money boosted the value of the teams. Not to mention Bettmans claim of 1.4 billion for 4 teams was not nearly enough.

If Phoenix goes for 300 million Seattle and Quebec have to be 500 mm plus

No way Seattle's expansion fee is going to be 500m. Note Seattle is an unknown market to the NHL. Remember if the NHL wants to See Sodo arena built with out a NBA team the Coleman has to put serious cash into the arena to get the city to agree to modify it. I doubt Coleman is willing to throw close to 700m for arena and team. You basically price out the entire market.

That 1.4b rumor is too small which is 350m per team and NHL can get way way more than that from TOR2 and Quebec city. But not more than that for Seattle and Vegas. Market sets the fee imo bigger the hockey market the city is the higher the expansion fee the league could get from that city.

 

[beepeearr]

Wow so he pays almost as much as Ice Arizona did, and only gets 51% of a hockey team thats been losing money for years... thats seems... really odd unless there is more going on. So the question is, does he just really really want to be in the NHL or is he buying a team to move eventually or sell? He wanted the Islanders, so does that mean he wants a team in the NorthEast (Hartford?, closest to the New York area).

 

[gstommylee]

Wow so he pays almost as much as Ice Arizona did, and only gets 51% of a hockey team thats been losing money for years... thats seems... really odd unless there is more going on. So the question is, does he just really really want to be in the NHL or is he buying a team to move eventually or sell? He wanted the Islanders, so does that mean he wants a team in the NorthEast (Hartford?, closest to the New York area).

Why would the NHL want another team in the eastern conference? And have it go to 13/17? If the coyotes are relocating the team will remain in the western conference.

 

[Confucius]

Wow so he pays almost as much as Ice Arizona did, and only gets 51% of a hockey team thats been losing money for years... thats seems... really odd unless there is more going on. So the question is, does he just really really want to be in the NHL or is he buying a team to move eventually or sell? He wanted the Islanders, so does that mean he wants a team in the NorthEast (Hartford?, closest to the New York area).

Too funny if he has cash to burn and just wants to keep the team in Arizona. If he golf's the Yotes aren't going anywhere. Besides he has the present group to pay half his losses. That is unless they just walk away when the 1st cash call comes in.

 

[Killion]

A stunning turn, but not a shocking move... IA is not a rich group and I could see Bettman facilitating this deal to make his legal action against Wang go away.

For his part, Barroway probably sees the Coyotes as a moveable asset in a few years time thus worth paying for

Im not really stunned or shocked myself Brodie. Its been my belief that the actual sales prospecting cycle didnt stop when Renaissance (now IceArizona) purportedly acquired the franchise in a beyond heavily leveraged transaction that didnt/doesnt make any sense unless.... they were merely Caretakers. The NHL continuing to beat the bushes for "real ownership". Someone who could pay-out Fortress Investments $120M loan while having the wherewithal to have no need for an additional $85M interest free loan from the NHL. And not a bad deal short-term as the majority owner will receive $15M from the City annually, un-capped Revenue Sharing proceeds, monies from the NHL Development Fund, enriched Broadcasting Revenues & so on & so forth. The asset portable in 4yrs with franchise values on an escalator up..... that Barroway's agreed to drop his $10M suit against Wang merely a minor detail, an adjunct, side-bar.... thats like booking 20 weeks at Richard Bransons 71 acre Necker Island near St. Thomas that he rents out at like $50,000 for 7 nights. Chump Change Man.

 

[beepeearr]

Why would the NHL want another team in the eastern conference? And have it go to 13/17? If the coyotes are relocating the team will remain in the western conference.

At this point who knows, maybe move the Florida teams to the central, Colorado to the pacific and that opens two spots in the NE, say QC and relocated phoenix and still leaves an opening in the Pacific for whoever

 

[gstommylee]

At this point who knows, maybe move the Florida teams to the central, Colorado to the pacific and that opens two spots in the NE, say QC and relocated phoenix and still leaves an opening in the Pacific for whoever

I don't think Florida franchise would leave the eastern conference though. I still think Coyotes are gonna end up in Portland if they have to move. There is currently no option for another central team at the moment.

 

[superdeluxe]

So... Is this good news or bad? Not sure what to read between the lines.

Well its good news what he is paying for it, means team valuations are up across the board.

 

[Eric Sachs]

Barroway finally gets on base after taking two strikes in the last two years trying to buy the Devils and Islanders.

Makes you wonder whether he just really badly wants to own an NHL team regardless of location or whether he just wanted to grab one of the cheaper franchises to move it elsewhere (all have their obstacles short-term).

 

[Fugu]

Two things come to mind.

This recent article (and not a single response) pointed that the NHL doubled its credit facility to $1.4 billion, and that teams can borrow from the facility directly without having to secure financing outside this NHL backed tool:

http://hfboards.mandatory.com/showthread.php?t=1742649


Seeing that the NHL was financing this directly, plus Fortress Investments, the fact that Barroway seems to be purchasing a controlling share is intriguing. FI, if I recall, would probably have to "approve" the new stake since they had some right to purchase some portion of the team after 5 years.

Secondly, Paul Allen cited the recent escalation in NHL team valuations, and no doubt that $5 billion TV contract from Rogers helped. There's a case of an owner helping their own cause by having team values increase across the board-- not that the Leafs need the help.

It's all in the family, one big happy family.

So, sure, if the Isles are worth $400-500 MM, why not?

 

[gstommylee]

Barroway finally gets on base after taking two strikes in the last two years trying to buy the Devils and Islanders.

Makes you wonder whether he just really badly wants to own an NHL team regardless of location or whether he just wanted to grab one of the cheaper franchises to move it elsewhere (all have their obstacles short-term).

Well if its to move it, where would he move it to that the league would allow cause there is the issue that i listed a bit ago.

 

[GordonGraham]

The Post has been told that the franchise is claiming losses of $24 million for last season alone.

With a full revenu sharing share, 15M from the city and a cap floor payroll is this even Possible?

 

[Killion]

I guess that rogers tv money boosted the value of the teams. Not to mention Bettmans claim of 1.4 billion for 4 teams was not nearly enough.

I think in part yes...

Besides he has the present group to pay half his losses. That is unless they just walk away when the 1st cash call comes in.

No, they dont have that kind of cash, Im sure they'll be gone, all but possibly George Gosbee as a Minority Partner remaining. Possible Anthony LeBlanc remains in some capacity. Hard to tell without knowing the specific details of whatever secret deals were made, what agreements made if & when the NHL did manage to rustle up someone with real money.

Well its good news what he is paying for it, means team valuations are up across the board.

Ya Id take that $300M+ number with a block of salt. Part of it as well the insanity in LA, that NBA franchises record setting sale price driving much of these hyper-inflated estimations. Certainly as per the above with the uptick in Broadcast Revenues etc, they are up but not by that much in Arizona. Just no way. If ever there was a damaged brand & entertainment product, thats it even with the $15M in AMF's, league welfare & the receipt of RS & Development Funds. No way Glendale can continue being bled to the tune of $15M a year while also paying the debt service fee's of app $9M+ on the Arena Bonds. Not with what the team even with sellouts brings them in ticket surcharge receipts & taxes. Concert & event business anemic.

 

[TheLegend]

Two things come to mind.

This recent article (and not a single response) pointed that the NHL doubled its credit facility to $1.4 billion, and that teams can borrow from the facility directly without having to secure financing outside this NHL backed tool:

http://hfboards.mandatory.com/showthread.php?t=1742649


Seeing that the NHL was financing this directly, plus Fortress Investments, the fact that Barroway seems to be purchasing a controlling share is intriguing. FI, if I recall, would probably have to "approve" the new stake since they had some right to purchase some portion of the team after 5 years.

Secondly, Paul Allen cited the recent escalation in NHL team valuations, and no doubt that $5 billion TV contract from Rogers helped. There's a case of an owner helping their own cause by having team values increase across the board-- not that the Leafs need the help.

It's all in the family, one big happy family.

So, sure, if the Isles are worth $400-500 MM, why not?

The first thought I had was this could eliminate some of the financing involved in the IA purchase.... be it from FI or the NHL.

Where it goes from that point remains to be seen, but here you are the NHL and you have someone with a big wad of cash who wants to get into your club.

 

[gstommylee]

With a full revenu sharing share, 15M from the city and a cap floor payroll is this even Possible?

I'm surprised its that high. If it gets any worse that would mean the 50m loss can be hit in another year.

 

[George Binks]

That was fast

 

[barneyg]

300 Million valuation? Wow-I'm assuming that's with the arena?

what are you talking about? IA doesn't own the arena (maybe Hulsizer would have?)

$300M makes no sense if the team indeed lost $24 million last year, but I guess we'll see soon -- as opposed to what goyotes wrote, IA actually had until Sept. 30 to provide its loss report for year 1.

 

[mesamonster]

If this story is indeed true it defies logical economic belief? How in the world does a sane buyer pay this much money for a known loser? The most interesting fact was the purported 24 MM loss last year? That is a number that I have always thought was likely, yet these IA clowns have been doing everything possible to hide this reality!

So let me say again, the financial metrics for 2014-15 look even worse! Pre regular season analysis indicates expenses will be up significantly, yet revenue will be in a best case scenario in line with one year ago! Bottom line: losses this year could approach 35-40 MM! Yes that high! Other than a preordained move sanctioned by GB, this clearly is an absolutely foolish business decision. Sorry, but if this in fact a true story, his purpose have is with the intention to move this franchise sooner than later!

 

[pondnorth]

So in the last year the value of the Coyotes has doubled,if it was ever worth 155m.Expansion into supposed better markets will cost 500m not including a building to play in and still most of the franchises are in the red,some in the dark red.Why does almost everything the NHL does seem shady.Mark Chipman made a very good investment to see his team triple in value in 3 short years.Something is wrong with this picture.

 

[Dolemite]

I want everyone to keep this in the back of their minds as this unfolds....the outcome of this new set of events will play directly into the legacy of Wayne Gretzky which is already more than tarnished.

 

[gstommylee]

If this story is indeed true it defies logical economic belief? How in the world does a sane buyer pay this much money for a known loser? The most interesting fact was the purported 24 MM loss last year? That is a number that I have always thought was likely, yet these IA clowns have been doing everything possible to hide this reality!

So let me say again, the financial metrics for 2014-15 look even worse! Pre regular season analysis indicates expenses will be up significantly, yet revenue will be in a best case scenario in line with one year ago! Bottom line: losses this year could approach 35-40 MM! Yes that high! Other than a preordained move sanctioned by GB, this clearly is an absolutely foolish business decision. Sorry, but if this in fact a true story, his purpose have is with the intention to move this franchise sooner than later!

IF everyone knows the out clause is going to be invoked after the 5 year period its just sets things up for the eventual relocation of the team.