Balsillie/Phoenix part V

[RR]

Is it possible for the judge to rule that the franchise can be relocated but still not give the purchaser the right to choose the destination without NHL approval?

Yes, and that's where the smart money is going right now. The Judge has hinted that he is apprehensive to set precedence in this case, and a bankruptcy court telling a major sports league it must do business with someone it doesn't believe is suitable is a huge precedent. His job is to best protect the interest of the creditors, which a ruling allowing relocation would do. The NHL then appeals the judge's ruling, later rejects Balsillie's application to buy, and JB files an anti-trust suit. The league then finds an owner it agrees is suitable and keeps the team in Phoenix or moves it. And the league wants it to stay if a local owner can be found.

All conjecture, of course, but it's how I see it going down on Tuesday.

 

[MAROONSRoad]

OF COURSE Paul Kelly is going to be all for pulling the plug on Phoenix and moving the team to Hamilton - it would mean more revenue generated, and thus more money for the players. In fact, Kelly would be all for moving the existing teams around in such away that teams were located in the 30 spots that maximized revenue for the players; if that meant 4 teams in Toronto and 3 teams in Montreal, while New York had one and places like Los Angeles/Anaheim, Dallas, Atlanta, Minnesota, and Buffalo no longer had a team, that would be just dandy for Kelly and the NHLPA. If that meant a team in London, Paris, Brisbane and Quito, that would be great for Kelly as well. If those teams happened to make a profit, ... well, that's nice - if they don't, it's not Kelly's problem. After all, it's not the union that has to shoulder losses - that's the problem of the owners. The players get their percentage whether the owners make $300 million or lose $300 million.

For Kelly and the NHLPA, the name of the game is "maximize HRR" through whatever means available. If Kelly could sell nightly stayovers at players' houses and have it count as HRR, you can bet he'd at least push the idea to the players. Kelly's job [as it should be] is to look out for the best interests of the players - and that means helping them get every last dollar they possibly can. The NHLPA is going to push for anything that is in their best interests first - and if it happens to be in the best interests of the owners, that's just pure luck.

The answer to Kelly's question: "as long as an owner is willing to shoulder losses incurred from operating in a given market, he is entitled to operate the team there for as long as he wishes - and there's nothing the NHLPA or fans of any other market can do about it." You know ... kind of like I've said for about 3 years now.

And no ... the NHLPA has no control in how or where [or even if] a team operates. Anyone who thinks they do should read Article 5 of the CBA.

Still doubting the NHLPA could have any influence on any matters regarding the business of hockey even though they are now signed up as partners with the owners? Still doubting they could not align themselves with certain members of the BOG which happen to support their position? When new CBA negotiations take place things will get interesting.

Here's what Kelly actually said:

In an interview with the Hamilton Spectator on Thursday, NHLPA executive-director Paul Kelly discussed what he felt should happen in the debate surrounding the future of the Phoenix Coyotes.

"From a players' perspective, it's time to pull the plug," Kelly told The Spectator.

Link:

http://www.tsn.ca/nhl/story/?id=280970

But of course the head of the NHLPA and the players have zero influence at all on the direction of the league.

GHOST

 

[MAROONSRoad]

Phoenix faked their attendance #'s yet that gets little discussion. How many other teams do likewise. Its pretty obvious many of those struggling US markets have been inflating their attendance #'s for quite some time.

I've been stating the “obvious†for years now.

It is nice that the debate seems to be finally moving, for some posters, beyond the bogus “announced attendance†figures for certain failed markets, which are totally made up for the most part, and that the debate is now more focus on issues such as gate receipts and revenue, etc.

You can basically ignore all data re. official NHL attendance figures as reported at places such as ESPN.com, any Forbes' estimates on anything and the Team Marketing Report. They are all bogus. There are now much better sources of info available.

.....

We do know, however, from court documents that the Coyotes averaged less than 11,000 actual fans per game last year in attendance and had one of the lowest ticket prices in the league.

GHOST

 

[eliostar]

Still doubting the NHLPA could have any influence on any matters regarding the business of hockey even though they are now signed up as partners with the owners? Still doubting they could not align themselves with certain members of the BOG which happen to support their position? When new CBA negotiations take place things will get interesting.

Here's what Kelly actually said:



Link:

http://www.tsn.ca/nhl/story/?id=280970

But of course the head of the NHLPA and the players have zero influence at all on the direction of the league.

GHOST

They don't really, how much influence did they have over head shots?
How much influence do they have over the Coyotes situation?
They can make statements to the media, but that's as much influence as they'll have.
Maybe the PA can pool their money and buy the Coyotes, than they can have a seat on the board.

 

[GSC2k2*]

Here is a bit of a blockbuster for all readers:

As of yesterday, the NHL has received four formal Background Applications from non-JB parties seeking to purchase the Phoenix Coyotes AND KEEP THEM IN PHOENIX:

1. Reinsdorf and a gentleman named John Kaites (who is apparently Reinsdorf's attorney and thus may or may not actually have a financial stake);

2. Breslow;

3. Howard Sokolowski and David Cynamon, current owners of the Toronto Argos (!!!!);

4. A Phoenix businessman who has requested anonymity pending due diligence.

 

[GSC2k2*]

More nuggets previosuly unknown:

1. When Colorado relocated to NJ, Quebec relocated to Colorado and Hartford relocated to Carolina, each time they paid the league a relocation fee which was shared collectively by the other clubs (these are in addition to the well known indemnity payments made by Colo/NJ and Anaheim).

2. The JB bid is really only $165 million per the NHL's review of the bid: $212.5 mil, less the $22.5 mil (as I have previously noted for the board), less the $25 mil advanced by the NHL against the revenue sharing payments that will be otherwise made in October 2009.) [MAKES REINSDORF'S BID SOMEWHAT MORE ATTRACTIVE, EH?]

3. Moyes himself, in his lawyer's (Scudder) sworn declaration actually took a conservative stab at the value of an NHL team in southern ONT. The NHL has noted that this effectively sets a floor for the value of a relocation fee (the values have been redacted from the court documents - arrrghh).

More to come.

 

[Jake16]

Here is a bit of a blockbuster for all readers:

As of yesterday, the NHL has received four formal Background Applications from non-JB parties seeking to purchase the Phoenix Coyotes AND KEEP THEM IN PHOENIX:

1. Reinsdorf and a gentleman named John Kaites;

2. Breslow;

3. Howard Sokolowski and David Cynamon, current owners of the Toronto Argos (!!!!);

4. A Phoenix businessman who has requested anonymity pending due diligence.

Plus, Exhibit C to Jerry Moyes' brief is a comparison chart comparing Balsilie's $212.5M bid to 3 others:

1. $140M by "based on offer by Max Chambers";
2. $130M "an amount sugggested by the press for the so-called 'Reinsdorf' bid";
3. $90M "based on net amount of an offer from Garvin Profit"

 

[Jonas1235]

http://www.theglobeandmail.com/sports/argo-owners-interested-in-buying-coyotes/article1172250/

How about that for irony.

 

[berklon]

The charade is hilarious. Buy the team and keep them in Phoenix. Yep, I'm sure that's the long-term plan.

 

[Gnashville]

Plus, Exhibit C to Jerry Moyes' brief is a comparison chart comparing Balsilie's $212.5M bid to 3 others:

1. $140M by "based on offer by Max Chambers";
2. $130M "an amount sugggested by the press for the so-called 'Reinsdorf' bid";
3. $90M "based on net amount of an offer from Garvin Profit"

And if the 3 bidders all pooled their resources then they would have a 360 million dollar bid on the table also.

 

[Fugu]

And if the 3 bidders all pooled their resources then they would have a 360 million dollar bid on the table also.

Why would they do that? I know these numbers are interesting and all, but it is real money to these prospective owners. Maybe they're all supposed to come and burn $300 million, then walk away.

Are you honestly saying these three groups should pay $360 million for the Phoenix franchise?

 

[GSC2k2*]

And if the 3 bidders all pooled their resources then they would have a 360 million dollar bid on the table also.

No, that is wrong. Their bids are each based on 100% ownership. Let's not get silly.

 

[GSC2k2*]

http://www.theglobeandmail.com/sports/argo-owners-interested-in-buying-coyotes/article1172250/

How about that for irony.

GSC2k2 scoops the Globe. More news later.

 

[Fugu]

GSC2k2 scoops the Globe. More news later.

Thanks, Bill. Nice of you take a break from your daly, errr, I mean daily, daily tasks.... to keep us informed.

 

[Ted Hoffman]

Still doubting the NHLPA could have any influence on any matters regarding the business of hockey even though they are now signed up as partners with the owners? Still doubting they could not align themselves with certain members of the BOG which happen to support their position? When new CBA negotiations take place things will get interesting.

1. As carpenter and others have mentioned multiple times now, "partner" does not mean "50/50".
2. They were "partners" before this CBA; of course, in the prior CBA there was no cap on salaries on an individual, team, or aggregate basis and there was no formal requirement for revenue sharing.
3. I'm just curious: what member of the BOG is going to sign off on throwing out this piece of the CBA?

Article 5 - Management Rights

Each Club, and, where appropriate, the League, in the exercise of its functions of management, shall in addition to its other inherent and legal rights to manage its business, including the direction and control of its team, have the right at any time and from time to time to determine when, where, how and under what circumstances it wishes to operate, suspend, discontinue, sell or move and to determine the manner and the rules by which its team shall play hockey. Nothing in this Article shall, however, authorize a Club or the League to violate any provision of this Agreement or of any SPC.

All of the rights which where inherent in each Club and where appropriate the League, as owner and operator of its business, including its team, or incident to the management thereof, which existed prior to the selection of the NHLPA as exclusive bargaining representative by the Players and which are not expressly curtailed or contracted away by a specific provision of this Agreement or by any SPC are retained solely by each Club. A Club, and where appropriate the League, may take any action not in violation of any applicable provision of this Agreement, any SPC, or law in the exercise of its management rights.

The correct answer: ZERO. If you really think that one of the 30 NHL teams is going to say, "gosh - I think Kelly is right, I think we should let everyone have a say in how a team is run," :rofl: there will be 29 other teams ready to pull out an iron rod and lay a beating. No team is going to let the NHLPA tell it how it must operate, and no team is going to let any other team tell it how to run its business. [Yes, I'm still waiting to hear how the NHLPA is so special that they're going to get a power that even the MLBPA doesn't have - and again, don't trot out the "ooh, it's a partnership" line.]

If the Maple Leafs want to run their franchise into the ground, it's their right - and no one else has any say so in how they operate. If the Blackhawks want to withhold TV rights and jack up ticket prices and put a crappy product on the ice while pocketing the profits, .... no, wait - they already did that. Hence, the idea that the NHL is comprised of 30 separate entities who each operate separately from one another.

I read the link. I don't need to see it again. If you need to post it for your own reference, fine - but I'm quite able to find Kelly's remarks. [I'd comment that he made these comments to the newspaper in Hamilton and that, when asked about Balsille's bid, Kelly got very non-committal ... but maybe someone else will do that.]

Maybe you think it'll get interesting in the next CBA negotiation. I'm positive that the first time Kelly says, "... and we want a say in how a team operates" Bettman and the rest of the owners walk out of the room and leave a "when you drop this demand, let us know - otherwise, I hope to God you guys have saved up some money" calling card. So yeah ... I doubt it happens. If they really feel that strongly about this, maybe they can do what eliostar suggested - pool their money, buy the Coyotes, move them to [insert city here] and reap the benefits.

My point still stands - Kelly's interests are in maximizing HRR first and foremost; if that happens to be good for the owners, great - but the goal is for the union to get every last dollar they can now.

 

[pepty]

According to this article in the Globe today, the idea of circumventing league rules and grabbing a team out of bankruptcy and moving it is not something that Balsillie was driven to after trying in vain to enter the NHL club through the front door.

It is instead a strategy conceived by lawyer Richard Rodier and pitched to Balsillie
among others.

It has been the only game plan from day one.

http://www.theglobeandmail.com/sports/rodier-a-dogged-strategist-behind-the-scenes/article1172125/

 

[Death128]

I'm thinking that those that want to keep the team in Phoenix will be looking for major concessions with the city and a new lease agreement. Glendale may just want a big payout at this point.

All of this publicity will hurt the Phoenix Coyotes image in Glendale and attendance will drop next year. The NHL might be hoping for more fan support as a result of all of this but I think the reverse will happen.

Could be.

 

[GSC2k2*]

I'm thinking that those that want to keep the team in Phoenix will be looking for major concessions with the city and a new lease agreement. Glendale may just want a big payout at this point.

All of this publicity will hurt the Phoenix Coyotes image in Glendale and attendance will drop next year. The NHL might be hoping for more fan support as a result of all of this but I think the reverse will happen.

Could be.

Nope. Phoenix has already agreed to a package of concessions (as admitted by the team itself) worth $14.6 million per year for any buyer of the team.

 

[Gnashville]

No, that is wrong. Their bids are each based on 100% ownership. Let's not get silly.

I meant they could if they pooled their resources if they wanted to and compete with Balsillie dollar wise. They only need a bid that satisfies creditor demands not one that re-writes the NHL rule book and allows for no control over franchise movement. If that amount is 200 million then they could go 50/50 or something just to keep the team in town and not throw the NHL into a tizzy.

 

[Death128]

Nope. Phoenix has already agreed to a package of concessions (as admitted by the team itself) worth $14.6 million per year for any buyer of the team.

Ahhh... I haven't been following closely. Any idea what these concessions are?

 

[Fugu]

I meant they could if they pooled their resources if they wanted to and compete with Balsillie dollar wise. They only need a bid that satisfies creditor demands not one that re-writes the NHL rule book and allows for no control over franchise movement. If that amount is 200 million then they could go 50/50 or something just to keep the team in town and not throw the NHL into a tizzy.

You're still side-stepping the issue of value. Why would a bunch of really rich guys throw that much money away? No one has suggested that the Yotes are worth that much money, so just getting into a bidding war with JB to 'help' the NHL doesn't make any sense. These guys don't owe the NHL anything, first of all, but more importantly, I don't think they'd be this fast and loose with hundreds of millions of dollars.

After all that, how long does it take for them to get anything back out of their 'investment'?

 

[LadyStanley]

All of this publicity will hurt the Phoenix Coyotes image in Glendale and attendance will drop next year. The NHL might be hoping for more fan support as a result of all of this but I think the reverse will happen.

Could be.

OTOH it could pique the interest and get new fans to the arena who want to see what all the fuss is about.

(Who was it who said all publicity is "good" publicity?)

 

[LadyStanley]

http://www.azcentral.com/arizonarepublic/local/articles/2009/06/05/20090605B1-talker0606.html
City of Glendale loses suit against NFL Arizona Cardinals for signage on road to stadium. (Cardinals have Coca Cola as sponsor and didn't want Pepsi banners on street.) Cardinals own the land the street is on (but it was built by city).



http://www.nationalpost.com/news/canada/story.html?id=1668351

In filings made by his attorneys last night, Mr. Moyes asserted his position as the team's largest unsecured creditor, with a claim of more than US$104-million. According to the filing --one in the avalanche of paper that was expected to hit Judge Redfield T. Baum's desk before midnight -- the next unsecured creditor in line was on the hook for about US$9-million.

Aramark, the concessionaire at JOBING.com Arena, is asking for $$ as well to compensate construction grants and other funds it paid.

Glendale has "no provision in the use agreement for the early termination by the [team]" of the arena lease.

 

[HockeyScholar]

You guys honestly believe that the Argo owners are looking to keep the Coyotes in Phoenix for a significant period of time!?

Bettman said each group has “indicated an interest in operating the franchise in Phoenix.â€

I'm sure the Argo owners wouldn't mind keeping the team in Phoenix for a year or two and then moving them to Toronto.

 

[Egil]

So how the **** are these 2 owners of the Argonauts bidding? This seems so unbelievably random, and as owners of 1 of the 2 non MLSE sports teams in Toronto, very suspicious.