Dallas Stars: Gaglardi's Stalking Horse Bid: $265 MM for Stars, AAC (50%)

MetalGodAOD*

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Dallas Stars bankruptcy hearing is underway in Delaware. First step towards the new ownership.
 

MetalGodAOD*

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Kritter471

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It's still $230M for team AND arena?
Given my reading of some things, yes (though not for a full arena share). It's not all debt assumption though - there are some significant cash payments.

I'm not that surprised that this is the stalking-horse price. With Hicks going into financial ruin and dragging his teams down with him, no rich person in their right mind would go in at full price.

Other than the giant repayment to the NHL, the unsecured debts are fairly small in the grand scheme of all this money. After the Rangers, they owe Crawford a little over $1 million for early contract termination. Every other unsecured debt is under $1 million.

ETA: I take a little of that back. It looks like the bid price is $267 million.
 
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Grudy0

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It's still $230M for team AND arena?
It's basically half of the arena, with the NBA Mavs holding the other half. I think the partnership between the Mavs and Stars is called Center Operating Company, and the partnership owns the arena. Unsure about repayment of public money used to build the arena.
 

MetalGodAOD*

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Brandon Worley of Defending Big D has been going over the court documents. Here's some findings:

It's mentioned that worth of Gaglardi bid is $266M, although numbers don't exactly add up upon speculation. Likely includes assumed debt.

This bid by Tom Gaglardi is gong to make it very hard for Greenberg, et al, to make a qualified bid.

Any bid must be $10 more in worth than Gaglardi, while still matching all the assumed debt that he is taking.

Not to mention, once the sale hits auction each bid must be made in $5 mil increments.
 

vofty

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Wow as much as we might gripe about Heika, I've sure missed his reporting for the DMN.
 

cbcwpg

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It's a buyers' market for NHL teams Sept 24
http://www.canada.com/sports/buyers+market+teams/5454225/story.html
The really depressing developments have been away from the ice, where previous owner Tom Hicks set off the always exciting bankruptcy drama in 2009 when he defaulted on $525 million in loans. That left the banks holding the team and the matter is now before the U.S. Bankruptcy Court in Wilmington, Delaware, where, as of this writing, Gaglardi has the only bid on the Stars. It will all be resolved by Nov. 23, but, this being the NHL, it’s bound to go through a couple of gyrations before then.

Gaglardi is offering about $265 million for the Stars and half of the still lucrative American Airlines Center. That bid, more or less, has been in play for more than a year and, despite rumours that everyone from Dallas Mavericks owner Mark Cuban to former Texas Rangers co-owner Chuck Greenberg are preparing their own offers, no one has stepped up.
 
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Kritter471

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That quote is from an article in the Province which is completely ridiculous in its omission of facts to basically try and get a slam in at Bettman at the end.

Gaglardi is the only bidder at this time, but that's because bids in court are not due until late October. There two parties who have publicly state they will likely put in bids when the deadline is here. Cuban is not one of them, but Greenberg and Doug Miller are.

Also, $265 million for the team and arena, both egregiously laden with debt because of Hicks' financial issues (the team has around $210 million in debt from my understanding and the arena has $200 million), is not a ridiculously low price. The most the team itself has ever been valued at by Forbes (and the magazine has never stated how much the co-ownership of the arena has played into its estimation) is in the $230 million range. Given the bankruptcy issue, $265 million is a very reasonable starting point for an auction.

Finally, the bid has not been in play for over a year. Gaglardi's exclusive negotiating window only opened at the end of the season, and the number floated at that point was $230 million.
 

beepeearr

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Jan 11, 2006
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Not the most heartening of articles regarding the state of the team though. It is interesting that they had a plan were they thought they could get their losses down to 10 mil for the year, even with the lockout, and I doubt that number includes any potential revenue from making the playoffs.

Man this team really needs a few winning seasons and long playoff runs. I'm hoping that once the teams is out of the lenders hands, attendance will start to rise if they are still winning. I think a lot of fans were upset with Hicks and then the lenders for holding everything up last year, and maybe losing Richards because of it, really don't want to give the lenders any more of their money.
 

OttawaRoughRiderFan*

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At the risk of sounding like a dummy (and that is a risk I take often)...

The AAC is only 10 years old. Add in the Stars and...

At $265M, do the people of Dallas think Gaglardi is getting a good deal???
 

MetalGodAOD*

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At the risk of sounding like a dummy (and that is a risk I take often)...

The AAC is only 10 years old. Add in the Stars and...

At $265M, do the people of Dallas think Gaglardi is getting a good deal???

Considering he's paying almost no cash and simply taking on debt, he probably is OK with it.
 

Kritter471

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The $267m enterprise value on Gaglardi's bid (from the article) has me a bit confused.

I read on Forbes yesterday that Gaglardi's bid is only $50m cash and $100m debt.

http://www.forbes.com/sites/mikeoza...-debt-tied-to-nhl-team-climbs-to-290-million/


:help:
That's all that's easily discernible from the documents, but there is a lot more assumed debt from the day-to-day operation of the team, including existing contracts that have not been wiped out by the bankruptcy.

There is also assumed debt WRT the arena (which has I think $200 million of debt associated with it that is also not wiped out by the bankruptcy). Neither of which is spelled out in a direct dollar value I could find before my head started hurting.

For clarification's sake, the $50 million is a direct repayment to the NHL, for what is either an advance or a third-party transaction, and the $100 million is a payment to Monarch, which is a group that bought up a lot of Hicks debt at about 30 cents on the dollar and stands to make a profit off of this mess.
 

Fugu

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That's all that's easily discernible from the documents, but there is a lot more assumed debt from the day-to-day operation of the team, including existing contracts that have not been wiped out by the bankruptcy.

There is also assumed debt WRT the arena (which has I think $200 million of debt associated with it that is also not wiped out by the bankruptcy). Neither of which is spelled out in a direct dollar value I could find before my head started hurting.

For clarification's sake, the $50 million is a direct repayment to the NHL, for what is either an advance or a third-party transaction, and the $100 million is a payment to Monarch, which is a group that bought up a lot of Hicks debt at about 30 cents on the dollar and stands to make a profit off of this mess.

This sounds fairly similar to the original situation in Phoenix, where the NHL was owed $25-30 million (iirc??), and the fund from Michael Dell had secured credit of $80-ish million. I wonder if the NHL money would be offset by any pending revenue sharing payments that could be credited back to the league, or if they're already counting that potential in this accounting? The league funds won't be disbursed until they settle the escrow matter with the NHLPA.
 

LadyStanley

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http://www.defendingbigd.com/2011/1...-sale-tom-gaglardi-what-changes-can-we-expect

Currently, we're waiting on word on whether the sale process will be sped up and if the Asset Purchase Agreement can be approved by the courts sooner than the current November 23 deadline. This deadline was in place in case of any new bids being submitted to the courts, which would then need to be approved by the NHL and the court system before a November 21 auction. With no bids being submitted, as we assume to be the case, there's a chance the sale could happen much faster than originally thought.

There's no doubt this is what the lenders want and this is what Gaglardi wants. The lenders are looking to sell the team as fast as possible now to avoid having to spend more money on payroll. The Stars are under approval from the courts right now to utilize previously set-aside cash to continue business as before, but there's no way progress can be made until Tom Gaglardi is firmly in change of the organization.

So, by Thanksgiving, looks like there will be a new owner of the team.

Kinda have to wonder if they may want to push the sale up to 11/14 (or earlier), so Gaglardi would be on the hook for the 11/15 payroll (or sooner).


Article also speculates on the off ice "rebuilding" that may have to be done before the team can consider the on ice product (lots of holes in front office), and discusses the losses expected this year, exacerbated by the NBA lockout (and lowered AAC income).
 

knorthern knight

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(Note to mods; I'm not talking about individual games; this is the average attendance so far this season) Looking at http://espn.go.com/nhl/attendance on Oct 24, I see an average 9,641 attendance over the first 4 games... :help: Is this due to the uncertainty over the Dallas situation? Maybe it's one reason there are no other bidders. BTW, the St Louis Blues, also up for sale and with a team in the World series, are averaging 19,150 i.e. 100% of seats sold
 

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