Forbes: Atlanta Thrashers Will Likely Be Sold For $110 Million

[Bobster231*]

Don't believe everything you hear in the media. Take that to the bank.

Media is just speculation almost 80 percent of the time.

 

[Dado]

No, of course not. I dont think it'll come to that in Atlanta though.

There is now a report that the all-cash offer for the Stars - the Stars! - is only $80M. Something seems to have gone seriously wrong with NHL franchise values.

 

[Fugu]

I moved the Phx talk out of this thread, and over to the Phx thread.

 

[Finlandia WOAT]

Yeah, I was wondering about that. But I'm assuming this would be a self-imposed info. blackout by the parties involved, and NOT something that legally prevents any news from being released, no?

It is, I regret to inform, speculation.

But ASG will not want anything to take away from their beloved Hawks' playoff run.

Ironically, the Hawks are almost as poorly run as the Thrashers, which goes to show how competent ASG truly is.

Anyways, I would be shocked if we learn anything shocking (re: names) before the Hawks run is over.

 

[dj4aces]

There is now a report that the all-cash offer for the Stars - the Stars! - is only $80M. Something seems to have gone seriously wrong with NHL franchise values.

I think folks in Dallas are trying to be vultures, and acquire a valuable team for pennies on the dollar due to all the financial trouble there.

 

[GSC2k2*]

There is now a report that the all-cash offer for the Stars - the Stars! - is only $80M. Something seems to have gone seriously wrong with NHL franchise values.

One thing going wrong is that they are being reported, read, and interpreted without the benefit of knowledge. Half-witted sportswriters quote the cash portion of a transaction as "the price". i guess that means most of those sportswriters' "purchase price" for their house was about $25,000, since you obviously don't count the debt you are taking on. Yeesh.

Just to debunk the assertion of Dado above, "the all-cash offer" of $80M was a reported offer of mark Cuban, who offer was (i) NOT just for that amount, and (ii) was summarily dismissed, making it as valid as the $1 offer for the team from my mailman.

 

[Grudy0]

If I offer you a deal that is guaranteed to leave you dead, there is no cost to you taking a likely-suicidal scorched earth alternative path of action. That's what happened in Phoenix - NHL tried to enforce the rights you described and bankruptcy court shoved it right up their backsides and two years on we're STILL sorting it out.

And there is STILL no local owner.

There may not be an owner, but the NHL was able to enforce their rights: not even bankruptcy can challenge the NHL by-laws relating to ownership approval.

So ASG cannot sell and sue, as precedent has already been set. The NHL is able to control who is able to own and operate a franchise within the league.

Besides, the NHL currently owns a franchise they are trying to unload, and the incumbent host city has pulled all of their "deals" from the past five or so months off of the table.

 

[Killion]

Something seems to have gone seriously wrong with NHL franchise values.

Ya, there are too many of them and so it no longer holds the same caleche' it once did. But seriously Dado, that mess left by Hicks' has seriously convoluted the equation no?. I mean, youve got Gagliardi offering nothing up & assumption of debt; Cuban as a minority partner in a bag of kibble fed partners looking for scraps; just on & on. Hardly indicative of the Stars "actual" franchise value.

 

[Dado]

Hardly indicative of the Stars "actual" franchise value.

If I mortgage my house to 200% of its value, and then need to sell it, it's still worth 100% of it's value.

If these guys really are lowballing and "actual" value isn't being unlocked, there should be DC-3s loaded with Tumi bags o' cash hitting JR's airstrip right about now.

 

[cbcwpg]

There is now a report that the all-cash offer for the Stars - the Stars! - is only $80M. Something seems to have gone seriously wrong with NHL franchise values.

Only if your trying to dump one.

Sports franchises are like anything else, they only have perceived value most of the time, and they only have real value when being bought or sold, and only to those involved in the transaction.

Just an observation. Who's to say an NHL franchise should be worth $200M and not $50M. Maybe the players are getting paid 4 times what they should be, and maybe tickets cost 4 times what they should. And maybe in the past people overpaid for these franchises.

I'm trying to sell a team and I want $110M, but the best offer is $40M. What's the right value? Whatever price can be agreed upon is the answer.

 

[Dado]

...and they only have real value when being bought or sold, and only to those involved in the transaction.

Oh, we're in total agreement on that. It's just that this particular franchise has been portrayed as a kind of "Maple Leafs of the Southern Expansion". Some things you - or at least I - expect to retain better value than other things.

 

[DeathToAllButMetal]

Those saying here that the Balsillie case made it clear that the NHL has the right to deny teams permission to move are dead wrong. Baum actually ruled all the offers not good enough, so the NHL wound up coming in and taking over as the owner. Baum really avoided all of the big questions about league rights. I would also bet my life that if Glendale had taken the Balsillie cash offer to endorse his offer to the court, Baum would have granted the team to Balsillie and told the NHL to go to hell.

Those of you who think pro leagues have this huge power in courts and can do what they want should really look at the current climate. No court would rule that the NHL has the right to force an owner to sell locally at $110 million and ignore an outside offer of $200 million. It ain't gonna happen, and the NHL would not get into that fight with an existing owner. Again, the Balsillie case was totally different. New unapproved potential team owner, and the likely demand to move the team into somebody else's territory. There are no such complications here.

 

[Finlandia WOAT]

Those saying here that the Balsillie case made it clear that the NHL has the right to deny teams permission to move are dead wrong. Baum actually ruled all the offers not good enough, so the NHL wound up coming in and taking over as the owner. Baum really avoided all of the big questions about league rights. I would also bet my life that if Glendale had taken the Balsillie cash offer to endorse his offer to the court, Baum would have granted the team to Balsillie and told the NHL to go to hell.

Those of you who think pro leagues have this huge power in courts and can do what they want should really look at the current climate. No court would rule that the NHL has the right to force an owner to sell locally at $110 million and ignore an outside offer of $200 million. It ain't gonna happen, and the NHL would not get into that fight with an existing owner. Again, the Balsillie case was totally different. New unapproved potential team owner, and the likely demand to move the team into somebody else's territory. There are no such complications here.

The exact situation you describe happened in the early '80's, when Blues owner tried to sell the team for a then-record 12 million dollars to an owner who would move the team to Saskatoon.

The NHL blocked the move, on the grounds that Saskatoon is not big enough. The Blues owner sued the NHL, lost, was fined for violating his contract with the NHL and stripped of the team.

http://www.stlouisgametime.com/2009/4/5/823172/the-saskatoon-blues-the-story

The NHL has final say in where franchises can and can not be located, and who can and can not run them.

And anyways, ASG has a right to sell to whomever they want to. If anyone, THEY will be the ones who would sue the NHL, for forcing them to accept a local deal that would have payed them less (and likely lose).


On a slightly different vein, why do you want owners to be able to sell to whomever they want? If that happened, then all the Canadian teams minus the Big 2 would pack up and move south (and they would have already).

Edmonton would be in Houston, the Sens in Kansas City, and Vancouver and Calgary would be sold as soon as their finances went south.

 

[manisback121]

Its a case of whose **** is bigger with Glavine and TNSE.

I have a feeling that Glavine will prevail with the thrash

 

[CGG]

On a slightly different vein, why do you want owners to be able to sell to whomever they want? If that happened, then all the Canadian teams minus the Big 2 would pack up and move south (and they would have already).

Edmonton would be in Houston, the Sens in Kansas City, and Vancouver and Calgary would be sold as soon as their finances went south.

In what parallel universe would Kansas City bring in more money than the Ottawa Senators? Ottawa is in the Top 10 for revenue (as are all Canadian teams). Vancouver moving? Are you insane? Again, what US city (that doesn't currently have a team) could ever hope to pull in more money than Vancouver? Milwaukee? Vegas? Portland? Omaha?

 

[GSC2k2*]

In what parallel universe would Kansas City bring in more money than the Ottawa Senators? Ottawa is in the Top 10 for revenue (as are all Canadian teams). Vancouver moving? Are you insane? Again, what US city (that doesn't currently have a team) could ever hope to pull in more money than Vancouver? Milwaukee? Vegas? Portland? Omaha?

No, they're not.

REgarding Vancouver, I think the poster is saying they would have moved before they had a chance to be successful - years ago, when they were drawing flies.

 

[SmokeyClause]

One thing going wrong is that they are being reported, read, and interpreted without the benefit of knowledge. Half-witted sportswriters quote the cash portion of a transaction as "the price". i guess that means most of those sportswriters' "purchase price" for their house was about $25,000, since you obviously don't count the debt you are taking on. Yeesh.

Just to debunk the assertion of Dado above, "the all-cash offer" of $80M was a reported offer of mark Cuban, who offer was (i) NOT just for that amount, and (ii) was summarily dismissed, making it as valid as the $1 offer for the team from my mailman.

Well, if it was an "all cash" offer, then a standard home purchase transaction isn't synonymous. However, you are right that the cash portion of the transaction, even when no financing is used, is often not the true deal value, especially for distressed organizations.

 

[SmokeyClause]

Actually, it is not indefensible in the least, but don't let that stop you.

To smokey, effectively what they are doing is to require that the effective date of any transaction for the club be the same date as the NHL acquired it. Any losses thereafter would constitute a closing adjustment to the purchase price.

One thing Fugu does have right is that the price is the price.

I will agree that the price is the price, and the owner can dictate that. However, it would appear that this valuation approach will result in nothing more than the franchise becoming a ward of the NHL. Why a prospective owner would pay such a premium for a product that doesn't appear to be financially viable in the short-term is beyond me. Bettman is negotiating from a position of extreme strength and power while standing on a boogie board in the middle of an open ocean squall.

 

[CGG]

No, they're not.

REgarding Vancouver, I think the poster is saying they would have moved before they had a chance to be successful - years ago, when they were drawing flies.

My humble apologies, Ottawa was actually 12th in revenues according to Forbes, in 2010.

http://www.forbes.com/lists/2010/31/hockey-valuations-10_rank.html

(Cue the diatribe about how terrible Forbes is at ranking these types of things.)

Who wants to bet they moved up in 2011, overtaking attendancie-challened New Jersey on the strength of another season of (near) 100% capacity and a strengthening Canadian dollar?

 

[Free Edler]

No, they're not.

REgarding Vancouver, I think the poster is saying they would have moved before they had a chance to be successful - years ago, when they were drawing flies.

Given their average attendance hasn't been under 14,000 - even in the dreadful Keenan/Messier days - since moving to the new rink, are you talking about the 1980s, or even further back when they were owned by the crooks in the early 70s?

I know Brian Burke made veiled threats about '25 cents at a payphone and a Ryder truck will show up' when the team was awful, but the Canucks were never in serious danger of moving, despite how awful the team was and how poisonous management was.

 

[tarheelhockey]

There is now a report that the all-cash offer for the Stars - the Stars! - is only $80M. Something seems to have gone seriously wrong with NHL franchise values the economy.

I have a feeling that if we put each pro sports franchise up for auction, we'd be shocked at their true market value. Sports-entertainment was a bit of a racket to begin with, but these days it's plain to see that the financial structure of these leagues is a house of cards.

 

[Grudy0]

Those saying here that the Balsillie case made it clear that the NHL has the right to deny teams permission to move are dead wrong.

Are you certain? Because I dug up this link from the AMLaw Daily...

Baum actually ruled all the offers not good enough, so the NHL wound up coming in and taking over as the owner.

Balsille offered about $240 million; the NHL offered $140 million. Judge Baum ended up accepting the bid from the NHL.

Baum really avoided all of the big questions about league rights. I would also bet my life that if Glendale had taken the Balsillie cash offer to endorse his offer to the court, Baum would have granted the team to Balsillie and told the NHL to go to hell.

Why? Judge Baum basically ruled that the NHL needs to approve a new owner, and that Balsillie wasn't approved, therefore, the franchise could not be sold to him...

Those of you who think pro leagues have this huge power in courts and can do what they want should really look at the current climate. No court would rule that the NHL has the right to force an owner to sell locally at $110 million and ignore an outside offer of $200 million.

Yet we have a court almost two years ago that did exactly that by allowing the NHL to purchase the Coyotes for $100 million less that Balsille, and the court even fortified that the league's by-laws must be followed, even in bankruptcy.

It ain't gonna happen, and the NHL would not get into that fight with an existing owner. Again, the Balsillie case was totally different. New unapproved potential team owner, and the likely demand to move the team into somebody else's territory. There are no such complications here.

Sure there are complications, compounded by the fact that Judge Baum ruled that the NHL has the right to approve ownership groups.

Let TNSE present a big bag of money to Atlanta Spirit Group and see how fast TNSE is treated like Jim Balsille. No one can "sell and move" an existing franchise without the blessing of the NHL.

I am simply arguing that the "sell and move" aspect is dead because the NHL must approve the sale. Now if you start talking about a "move then sell", that would be different.

 

[Buck Aki Berg]

In what parallel universe would Kansas City bring in more money than the Ottawa Senators? Ottawa is in the Top 10 for revenue (as are all Canadian teams). Vancouver moving? Are you insane? Again, what US city (that doesn't currently have a team) could ever hope to pull in more money than Vancouver? Milwaukee? Vegas? Portland? Omaha?

Revenue and profit are two different things. When they were an inch from moving to Oklahoma City, they were under a tax burden that revenue from 41 sellouts a season (which they weren't getting at the time) couldn't have pulled themselves out from something.

 

[cbcwpg]

Let TNSE present a big bag of money to Atlanta Spirit Group and see how fast TNSE is treated like Jim Balsille. No one can "sell and move" an existing franchise without the blessing of the NHL.

Already been done, via the NHL and Bettman, and with the NHL's blessing, but an offer has been made none the less. Don't kid yourself. ASG knows exactly how much money TNSE has offered to buy the Thrashers.

But like I said, TNSE is playing by the NHL rules. The offer has been made via Bettman, so if nothing local happens Bettman has a Plan B, and TNSE is not taliking to the press.

 

[peter sullivan]

A
Let TNSE present a big bag of money to Atlanta Spirit Group and see how fast TNSE is treated like Jim Balsille. No one can "sell and move" an existing franchise without the blessing of the NHL.

I am simply arguing that the "sell and move" aspect is dead because the NHL must approve the sale. Now if you start talking about a "move then sell", that would be different.

why do you believe that TNSE is not working closely with the NHL on this transaction?...they are not negotiating with ASG behind the NHL's back with the intent presenting their scheme to the BOG after the fact.....TNSE's strategy all along has been to play by the NHL's rules....i can assure you that has not and will not change, no matter what the outcome.

they will not be trying to force the NHL's hand in any way....that is a given....if ASG sells the thrashers to TNSE it will have the blessing of the NHL long before they even enter into negotiations.