Can the NHL STOP Melnyk from moving to Quebec City ( or anywhere else )?

[Fenway]

I can't see Quebecor going behind the NHL's back, and trying to lure the Senators. It would be quite the rogue move, not quite Balsille like, but enough to blackball Quebecor. If the NHL has enough of Melnyk, you could see them approach Quebecor regarding a relocation, but with local ownership lines up in Ottawa, that doesn't seem likely

As I stated earlier what would happen if the City of Quebec voids Quebecor's arena contract and gives the keys to Melnyk?

 

[voyageur]

As I stated earlier what would happen if the City of Quebec voids Quebecor's arena contract and gives the keys to Melnyk?

That's not how it would work though. If Melnyk is a maverick owner that is on the outside, why would they let him move the franchise? To stay on as a maverick owner in a market that is proudly francophone, and has a francophone ownership group in place? It just doesn't make sense. I think Melnyk could sell his franchise to Quebecor. However again the BoG can veto the sale. So what does Melnyk do? Lose money in his current location. If he can't work with the city to build an arena, he's out. I think the league can take over the franchise if they have to, strip him of his ownership, and then negotiate with another ownership group, one that can get an arena built. That's a more likely scenario. I think Ottawa, while an undersized market, is still attractive to the BoG, with its steady growth and financial stability, once the source of its current troubles is removed. I think Melnyk sees the writing on the wall too.

 

[Mightygoose]

As I stated earlier what would happen if the City of Quebec voids Quebecor's arena contract and gives the keys to Melnyk?

Perhaps a potential lawsuit.

Is there any language in the lease that gives the city the right to just void the lease because someone else is offering an NHL team?

IIRC its the opposite, Quebecor's lease would get extended from 25 to 35 years if the operator lands and NHL team...could be off by the actual number of years.

Now if Melnyk buys out Quebecor's operating rights to the arena, then that could be a work around....except Melnyk having sufficient money to buy out the lease.

 

[Fenway]

If you had grown up in this area, you'd know that it's not "because the team is from Ontario" that the team hasn't successfully marketed to the Hull/Gatineau/Vanier. It's because their efforts to market to those groups have been half-assed and borderline negligent.

I mean, all of Eastern Ontario, pretty much all of Ontario east of St Laurent Boulevard, is francophone. Franco-Ontarien. Proud to be from Ontario. This is a huge part of the local fanbase that has always been disengaged, largely due to the team's utter disfunction in catering to that audience, and it has nothing to do with the team "being from Ontario". They are also from Ontario.

Speaking about the Francophone populations that reside in Quebec (Hull/Gatineau/Aylmer, etc...), the team's effort to market the team there has been even worse.

This market is very peculiar, and I'll be honest - it's going to take more than spending a 3-day weekend here to understand exactly how weird it is: the East-West english/french divide within the Ontario part of the city, the legacy of the Hull Olympiques with their ties to the Habs-centric media sphere and french language rights north of us in Hull/Gatineau, the legacy of Leafs and Habs fans in this area, the TV rights issues that historically have roadblocked the team's ability to advertise outside of city limits, and the past decade of short-sighted advertising efforts have excluded the entire city east of Vanier Parkway and basically pretended that Gatineau doesn't exist (not to mention basically being one of the worst team PR departments in the entire league in general over the past decade).

I have been visiting Ottawa for over 40 years as a good friend from college worked as a DJ at a popular Top 40 station that is now TSN 1200 and then became a promoter for concerts and comedy and I will concede I had no idea that Ottawa itself had a large francophone population. I thought it was mostly on the Hull side of the river.

My friend is now based in LA but still kept his Ottawa ties and represented talents such as Tom Green and the late Mike McDonald. He has told me that Ottawa was always a tough city to promote in. He said people there waited until the last possible moment to buy tickets and he suspects the Sens face the same issue today.

He told me how he secured the rights to a huge concert act (Eagles) and booked them into Rideau Carleton Raceway and 72 hours before the show he had sold less than 3,000 tickets and he thought he was ruined. The concert wound up attracting 20,000.

 

[Melrose Munch]

Relocation is more likely than quebec agreeing to pay US dollars of 650m+ for a hypethically expansion spot that won't ever exist in any time soon.

they pay 650m either way

 

[Nac Mac Feegle]

Could not do that in US, because Melnyk would take the relocation fee to court. It's supposed to be as assessment of the difference between the 2 markets. The league would have to explain the difference, and a 650M difference would obviously NOT fly.

Again, as far as I know, this has not been fully tested in Canadian law.

Well, the Lebreton project was valued at $4 billion, and Melynk supposedly had 50% equity in the project. You could argue a 650m relocation fee is pretty darn small considering what he'd be walking away from in Ottawa.

This whole thing is Melynk trying to squeeze out even more money from everyone, on top of a nearly free new arena. He wants to get his hands on the additional condo units that are being built downtown near the Lebreton project, in addition to his Lebreton payday.

 

[SunDancer]

The league (& Leafs/Sabres) do not want a team in Hamilton. Plus, no viable arena exists in Hamilton currently. Copps (or whatever it's called now) is too old & I don't think there are any plans to replace it.

Other than demanding some kind of indemnification, would the Leafs or Sabres be able to stop him?

And yes, the arena is also a problem. Melnyk's not a developer and he's proved in Ottawa that he's incapable of getting projects off the ground (casino, soccer stadium, Lebreton), so it's hard to see him doing anything in the GTHA.

I only brought this up because if he really wanted to mess with Bettman's NHL and relocate the Sens against the league's wishes, he should go for broke and bring the franchise to southern Ontario where it would be far more valuable than in QC.

 

[NorthCoast]

Well, the Lebreton project was valued at $4 billion, and Melynk supposedly had 50% equity in the project. You could argue a 650m relocation fee is pretty darn small considering what he'd be walking away from in Ottawa.

This whole thing is Melynk trying to squeeze out even more money from everyone, on top of a nearly free new arena. He wants to get his hands on the additional condo units that are being built downtown near the Lebreton project, in addition to his Lebreton payday.

There's a lot of good debate in this thread.

But almost every scenario regarding relocation assumes that Melnyk has some financial resources still available to him. I don't think those outside the market have fully grasped that their is a very real possibility that Melnyk is almost broke. I don't care what the scheme is, they all need some kind of financial foundation that Melnyk may very well not have anymore. Moving all the players, their families, re-hiring, re-branding, any league relocation costs, paying salaries while some revenue streams (ad deals, season tickets, etc) are being re-negotiated/sold, etc. etc. etc. There are hard costs in the tens of millions regardless of where he goes.

Wait, isn't Melnyk a billionaire? No, he's not. Not anymore. Not since he sold his 1b valued Biovail stock for 15o mil. Not since he lost 100 mil on his horses. Not since he gave 50% away (and pretty much all of his liquid assets not hidden in the Barbados) to his wife in divorce.

The rumors of his cost cutting rampages through the organization are well beyond where there's smoke, there is fire.
- Any big $ execs let go and replaced with cheap alternatives with little to no experience in sports management
- Any contract that is not 100% required is shipped out/waived, etc.
- Pro scout travel budget cut, now they rely solely on tape (wonder why we keep getting bent over in trades)
- Legend of a fight between EK and EM over an Uber bill
- Many, many stories from current employees about Melnyk coming in and questioning every costs...down to stationary use.
- Not willing to offer EK a front-loaded, bonus structured contract ala Tavares, because it would require paying out millions in advance of when revenues come in to cover the cost.
- Cannot cover the carrying costs of a loan to get the new arena built. Read that again, condo's will pay for the arena, but they might take 10-15 years to sell, so he has to be able to cover the loan for 10-15 years. 5-10 mil per year, so 100-200 mil for his new stadium. Team revenues if he wasn't hated could possibly even cover this...yet still he can't get it approved.
- Not able to hire a team capable of pulling off any major capital project (casino, soccer stadium, Lebreton, etc)

Team statements and debt increase show the team was losing around 10 mil per year until 2013-2014. Note this was not out of Melnyk's pocket...the team just accumulated more debt. The Nat TV deal and local TV deal increase revenues by 20-30 mil with no increase in costs. None of that additional money went into player budget, ops budget, stadium improvements, etc. Where did the money go?

Yes, Of course I could be wrong and maybe he still has a few hundred mil on Canadian or US soil that is liquid and can be used. But there is also a very real possibility that he is hanging on by a thread financially, living off the team and any additional credit that was created in the recent re-financing.

What about a minority owner? Would you buy into this...with this guy...at the overvalued price he wants...when he might drive the team into bankruptcy or move it to another market?

This is why he need a free stadium AND a piece of the larger development. Because he needs cash for the cash flow needed to run the organization.

He still has lots of options. But it very well be that in any scenario, whoever he partners with may have to cover all the immediate cash flow/costs, and offer a revenue stream on top of what the team would provide int he short-term. Good luck with that.

 

[Gnashville]

My only reaction to all of this is Ottawa deserves better than this. And yes, Bettman is powerless to stop it. More recent example is the Thrashers to Winnipeg.

The league will have a problem on its hands if Melnyk is allowed to move the team to Quebec.

Bettman never tried to stop the Thrashers moving to Winnipeg instead he blessed it and helped make it happen.

I wonder how the media and fans would react to a Canadian franchise moving within the country as opposed to the Evil Americans stealing their game.

 

[Fenway]

Bettman never tried to stop the Thrashers moving to Winnipeg instead he blessed it and helped make it happen.

I wonder how the media and fans would react to a Canadian franchise moving within the country as opposed to the Evil Americans stealing their game.

Atlanta couldn't be saved because the new owners of the arena and NBA team did not want to be involved with hockey. If Quebec had a new arena in place in 2011 the Thrashers might well have gone there instead of Winnipeg.

 

[Gil Gunderson]

Didn’t the NBA BoG veto a Sacramento Kings relocation?

 

[Mightygoose]

Didn’t the NBA BoG veto a Sacramento Kings relocation?

They did because it was a proposed sale to Chris Hansen who wanted them in Seattle.

Their previous owners backed away from an arena deal because they couldn't make the numbers work (sound familiar? ).

Yeah once they tried to sell, local interests stepped up and worked with the city to get the arena deal done.

 

[smitty10]

Bettman never tried to stop the Thrashers moving to Winnipeg instead he blessed it and helped make it happen.

I wonder how the media and fans would react to a Canadian franchise moving within the country as opposed to the Evil Americans stealing their game.

It will just end up an English vs French dispute probably. Don't think that some English speaking Canadians won't be pissed to see an Ontario team move to the heart of French-Canada.

Now, because it's Ottawa a lot of people won't care. If this was a team based out of Toronto, Winnipeg, Edmonton, Calgary, etc. it would be a much bigger deal.

 

[Edgy]

Why wouldn't Melnyk just give Quebecor a share in the team, get a favorable lease since the operator is part owner and get some financial relief by having a deep pocketed partner? Once the Sens broadcast deal is up with Bell, Quebecor can switch them over to TVA and up their profits. They make less money short-term for more money long-term. The arena is ready, the fans are there, the rivalry instant and the money would technically start coming in immediately so very little disruption or loss of revenue for him.

 

[LeHab]

As I stated earlier what would happen if the City of Quebec voids Quebecor's arena contract and gives the keys to Melnyk?

Quebec City and Province went as far as passing a special law to grant Arena management rights to Quebecor for 25 years without following usual competitive process. Don't know what opt-out the city has but any decision would likely have to be supported by Quebecor. Don't think any politician would want to piss off the largest media in the Province and one the biggest non-gov employer in the City. Quebecor could always retain management/naming rights and Melnyk would simply be a tenant. Sounds like many Chefs in the kitchen.

Regardless can't see Melnyk wanting to own a team in QC.

 

[Gnashville]

Why wouldn't Melnyk just give Quebecor a share in the team, get a favorable lease since the operator is part owner and get some financial relief by having a deep pocketed partner? Once the Sens broadcast deal is up with Bell, Quebecor can switch them over to TVA and up their profits. They make less money short-term for more money long-term. The arena is ready, the fans are there, the rivalry instant and the money would technically start coming in immediately so very little disruption or loss of revenue for him.

I think more or less this is the plan. Quebecor balked at the 1/2 billion expansion fee and would rather just own a percentage of the team. Say Quebecor pays 200 million for 40%. It’s a win-win Melnyk gets paid and Quebecor doesn’t have to pony up the entire cost of a team.

 

[Gil Gunderson]

I think more or less this is the plan. Quebecor balked at the 1/2 billion expansion fee and would rather just own a percentage of the team. Say Quebecor pays 200 million for 40%. It’s a win-win Melnyk gets paid and Quebecor doesn’t have to pony up the entire cost of a team.

That would have to go through a board of governors that doesn’t like to approve sales that result in relocation.

Melnyk also probably wants to own the whole team if that happens. He’s never been fond of finding a partner.

 

[Edgy]

That would have to go through a board of governors that doesn’t like to approve sales that result in relocation.

Melnyk also probably wants to own the whole team if that happens. He’s never been fond of finding a partner.

As already stated, the BoG would pretty much be powerless to stop him if he decides to move the team. Also, Melnyk never really had a partner with a ready arena at their disposal, a city that's been vying an NHL team for years and would probably offer him financial incentives should he move the team there.

I mean even if Quebecor isn't a partner, what's to stop Quebec city from picking up part of the tab for the arena rental in one form or another? I mean if Phoenix can help the Suns with the cost of renovating an arena so the Suns stay there, why can't Quebec city help Melnyk so he can move a team there?

 

[Fandlauer]

All this fantasyland nonsense. Whens the last time Melnyk entered into a partnership with anyone that didn't end up in a massive lawsuit?

 

[voyageur]

As already stated, the BoG would pretty much be powerless to stop him if he decides to move the team. Also, Melnyk never really had a partner with a ready arena at their disposal, a city that's been vying an NHL team for years and would probably offer him financial incentives should he move the team there.

I mean even if Quebecor isn't a partner, what's to stop Quebec city from picking up part of the tab for the arena rental in one form or another? I mean if Phoenix can help the Suns with the cost of renovating an arena so the Suns stay there, why can't Quebec city help Melnyk so he can move a team there?

If the league could stop Jerry Moyes from moving the bankrupt Coyotes they can stop any move. True North made a knockout proposal to get in the fold, and were given the first opportunity, which was ASG bailing out on hockey. Mark Chipman has become one of the most respected governors since then.

Peladeau is not Chipman. And Melnyk is not ASG. There is a city that wants to build a rink to keep its team, and an owner trying to get rich quick off it. I think he has disgraced a franchise that Bryan Murray made respectable. I can't see him holding on to this franchise much longer. Like I said the league can just take over operation like it has and did in Buffalo. Melnyk's absence from the meetings should be a telling sign of where he stands.

 

[mikelvl]

You are so wrong. Bettman and Jacobs CAN'T stop Melnyk from relocating the Sens if he wants. They don't have a legal leg to stand on.

I just don’t believe that it will ever happen. He won’t cross them.

 

[nobody imp0rtant]

Atlanta couldn't be saved because the new owners of the arena and NBA team did not want to be involved with hockey. If Quebec had a new arena in place in 2011 the Thrashers might well have gone there instead of Winnipeg.

I think this interview between Mark Chipman and Frank Seravalli will finally put an end to the myth that Quebec would have gotten the Thrashers if they had their new arena at that time.

https://www.tsn.ca/defining-gary-bettman-1.1208410

The pertinent quote from Chipman:
“In 2010, we spent a week in New York and, for all intents and purposes, completed a deal to buy the Phoenix Coyotes and bring them back to Winnipeg. It was contingent on the City of Glendale not coming up with a ton of money, which they did.
“On the day you find out you’re not getting the team after an intense process, normally you would be crushed – it was almost in our grasp. We even went as far as planning a press conference for the next day in Winnipeg to make the announcement. But there was actually a great deal of relief when we found out the Coyotes were staying.
“Gary said something to me like, ‘I’m giving you a coupon for the next NHL franchise.’
“We joked, ‘Does that coupon have an expiry date?’ I was relieved because there was no doubt whatsoever. We were getting a team – because he said so. His word was sacred there".

 

[Edgy]

If the league could stop Jerry Moyes from moving the bankrupt Coyotes they can stop any move. True North made a knockout proposal to get in the fold, and were given the first opportunity, which was ASG bailing out on hockey. Mark Chipman has become one of the most respected governors since then.

Peladeau is not Chipman. And Melnyk is not ASG. There is a city that wants to build a rink to keep its team, and an owner trying to get rich quick off it. I think he has disgraced a franchise that Bryan Murray made respectable. I can't see him holding on to this franchise much longer. Like I said the league can just take over operation like it has and did in Buffalo. Melnyk's absence from the meetings should be a telling sign of where he stands.

The league didn't stop Moyes from moving the team, they stopped the sale to Balsillie who wanted to move the team. Not the same situation.

CoreDev might be willing to build and rent out an arena for Melnyk but if rumors are true, he's cash strapped and is on a cost cutting rampage throughout the organization. If he wants to retain ownership of the team, then Quebecor becoming a minority shareholder by moving the team to Quebec makes sense. If he's looking to sell the team outright, then using Quebec to drive up the price also makes sense. But the OP is asking if the league can stop him from moving the team and so far the answer seems to be maybe, depending on how he goes about it and if the NHL can prove that not moving the team doesn't violate anti-competition laws.

 

[Grudy0]

I think this interview between Mark Chipman and Frank Seravalli will finally put an end to the myth that Quebec would have gotten the Thrashers if they had their new arena at that time.

https://www.tsn.ca/defining-gary-bettman-1.1208410

The pertinent quote from Chipman:
“In 2010, we spent a week in New York and, for all intents and purposes, completed a deal to buy the Phoenix Coyotes and bring them back to Winnipeg. It was contingent on the City of Glendale not coming up with a ton of money, which they did.
“On the day you find out you’re not getting the team after an intense process, normally you would be crushed – it was almost in our grasp. We even went as far as planning a press conference for the next day in Winnipeg to make the announcement. But there was actually a great deal of relief when we found out the Coyotes were staying.
“Gary said something to me like, ‘I’m giving you a coupon for the next NHL franchise.’
“We joked, ‘Does that coupon have an expiry date?’ I was relieved because there was no doubt whatsoever. We were getting a team – because he said so. His word was sacred there".

Wow.

I had suggested ages ago that TNSE, by virtue of helping the League with the Coyotes bankruptcy saga, jumped to the first in line for a franchise. It's nice to see the confirmation.

Not only does it blow away the myth that Quebec would have gotten the Thrashers, it blows out that anyone but Winnipeg was getting the next relocated team.

 

[Hal1971]

Wow.

I had suggested ages ago that TNSE, by virtue of helping the League with the Coyotes bankruptcy saga, jumped to the first in line for a franchise. It's nice to see the confirmation.

Not only does it blow away the myth that Quebec would have gotten the Thrashers, it blows out that anyone but Winnipeg was getting the next relocated team.

I remember a vote in glendale that was followed in quebec, even the old colisee was to be refurbished for nhl standard while the new arena was built. Maybe Quebec got the same coupon ? That's why expension was deffered, Quebecors opted to use the coupon for the next moving franchise ?

Glendale votes in favour of lease agreement with prospective owner of Coyotes - TheHockeyNews

The decision had been in doubt as RSE and the city went through tense negotiations over the past few weeks. The Coyotes may have relocated to another municipality, potentially Quebec City, if an agreement was not reached.