Hurricanes sale formally closed, Tom Dundon now majority owner

[CHRDANHUTCH]

Balsillie the guy thst wanted to buy a team and move it? That's a great example of why I'm skeptical, thank you. Karmanos was a billionaire business man that had an actual interest in hockey. He wanted a team in grand rapids but that wasn't feasible so took a team where he could. Does this guy have a history with hockey? Idk,seems like a baseball guy to me.

UH, Balsillie no longer is in play, Syckle... RIM/Black Berry also are long gone from the Canadian tech scene....

Karmanos owned/inherited Compuware, which is now gone to what, Olympia Sports, aka Chris Ilitch and the new Arena in Detroit, aka Little Ceasars youth hockey.... 2) Balsillie wouldn't have been approved anyway by Jacobs et all, after his propensity toward Arizona, Pittsburgh (before Lemieux/Burkle, THINK about Howard Baldwin, and how that worked both in PIT/HFD, IN both NHL/AHL), and the defending Western Champion Predators, in fact no one of the 26 of the 29 governors voted for him.

PKJ owned Plymouth's OHL Team..... you've mixed up the ownership. the Magic OWNERSHIP through the Grand Rapids arena rights, the Devos family controls Grand Rapids, even though the Wings are 4 hours away.... how we know this is that the DEVOS family owned 3 teams(KC/Orlando and GR), only 1 was allowed under AHL Bylaws 16 years ago now, KC and Orlando were contracted, though the Solar Bears were affiliated with Atlanta(now Winnipeg); that affiliation flipped to Chicago, (the same franchise, btw, that just released St. Louis for the expansion Vegas affiliation), until Winnipeg resurrected Manitoba's franchise despite subletting it to St. John's for 3 seasons.

 

[Gm0ney]

2010: Tampa Bay Lightning sold for $110M.
2011: Atlanta Thrashers sold for $110M + $60M relocation fee; Dallas Stars sold for $265M; Sabres sold for $189M.
2012: Blues sold for $130M.
2013: Devils sold for $320M; Panthers sold for $250M.
2014: Coyotes sold for $170M.
2016: Vegas awarded expansion franchise for $500M.

The average since 2010, including Vegas, is $227M. $500M seems way high for the Hurricanes but maybe Vegas is the new bar...?

 

[ps241]

2010: Tampa Bay Lightning sold for $110M.
2011: Atlanta Thrashers sold for $110M + $60M relocation fee; Dallas Stars sold for $265M; Sabres sold for $189M.
2012: Blues sold for $130M.
2013: Devils sold for $320M; Panthers sold for $250M.
2014: Coyotes sold for $170M.
2016: Vegas awarded expansion franchise for $500M.

The average since 2010, including Vegas, is $227M. $500M seems way high for the Hurricanes but maybe Vegas is the new bar...?

In 2014 when the LA Clippers sold to Ballmer for $2 Billion I think that inflated pro sport team valuations.

 

[htpwn]

I'm happy for Hurricanes fans, but hot damn that's a lot of money. In what strange world do we live in where the Carolina Hurricanes are worth half-a-billion dollars? Half-a-BILLION. Yeah, I know, Vegas paid that for an expansion franchise. It was nuts then, but if one rich guy wants to blow all his cash to put a hockey team in the middle of the desert, sure... have at it. That doesn't mean all the other rich guys need to follow his lead (although I suppose it really doesn't affect us as fans in any way).

 

[Roboturner913]

Well, Karmanos did set the price at $420 million when he first put it up for sale, several years ago, for whatever that's worth. People laughed at him and said it would never happen, but....

My guess is there's a lot more than meets the eye when it comes to the franchise value here. Gale Force and the arena deal I would imagine account for quite a bit of revenue that's not part of the franchise value of the Hurricanes themselves. My guess is, at least whatever the arena deal's cumulative dollar value through the lease which expires in 2024 is being added to the sale figure.

 

[Killion]

2010: Tampa Bay Lightning sold for $110M.
2011: Atlanta Thrashers sold for $110M + $60M relocation fee; Dallas Stars sold for $265M; Sabres sold for $189M.
2012: Blues sold for $130M.
2013: Devils sold for $320M; Panthers sold for $250M.
2014: Coyotes sold for $170M.
2016: Vegas awarded expansion franchise for $500M.

The average since 2010, including Vegas, is $227M. $500M seems way high for the Hurricanes but maybe Vegas is the new bar...?

Well, a couple of things... those "announced sale price" numbers, sorry, just not reality in every case. What this League claimed & what actually went down, night & day..... and yes, I do agree that $500M is the new threshold, minimum bar though an exception made very recently in Arizona. Should the Coyotes be sold for Relo however, be it to Seattle or QC, the buyer will be looking at a minimum of $500M.

In 2014 when the LA Clippers sold to Ballmer for $2 Billion I think that inflated pro sport team valuations.

Absolutely. Bettman when asked what he thought the average sale price for an NHL franchise should be in the wake of the Ballmer deal & the staggering sum responded spontaneously with "I dunno, I'd like to think the minimum would be about $500M".... Well, that "spontaneous, off the cuff" number that he pulled out of his ass became a reality in the blink of an eye when after yrs of denying Expansion was even a glint was announced.... and the entry fee?... why, $500M of course.... they get 2 applications, pricing themselves out of markets where they should be, accepting only Vegas, a vanity purchase, rich old white guy who wants to go out with a bang. Fine..... Contemporaneously, you also had Charles Wang in negotiations with Andrew Barroway, an agreement (supposedly) in place to sell him the Isles for app $400M. On the heels of the Clippers sale, those negotiations ended, Wang looking elsewhere & getting his $500M, Barroway tossed to the curb, threatens to sue gumming up the works, bought off & sent packing to Arizona.... then theres Peter Karmanos.... he likes that number too.... $500M... who wouldnt?.... Canes barely worth half of that..... but no matter.... and so here we are....

 

[Vdom999]

Offer of 500M$

Karmanos is looking for a buyer since 2010, and receives after 7 years an offer for 500M$, while loosing several M$ per year. Now, according to Don Waddell, Karmanos is considering the offer while at the same time considering other options, including not selling the team. Don't you find it a bit awkward?

See: https://www.bizjournals.com/triangle/stories/2010/05/24/daily2.html

Also, see the few number of concerts from now to December 31: http://www.songkick.com/venues/1770713-pnc-arena

 

[Navin R Slavin]

I remain skeptical of how interested he is in keeping it there long-term. Surprised someone would pay 500m for a team and be planning to keep them in Raleigh. It wouldn't be the first time a new owner outright lied.

Here's a serious question.

Do you know anything about the Raleigh area? At all?

I'm just amazed at people who don't understand what we have here, or don't care to. We're basically the Silicon Valley of the Southeast, with double digit growth every year and tons and tons and TONS of disposable income.

If the Canes become perennial winners, the owners are sitting on a gold mine. Like, a hockey machine that prints money.

 

[rj]

Here's a serious question.

Do you know anything about the Raleigh area? At all?

I'm just amazed at people who don't understand what we have here, or don't care to. We're basically the Silicon Valley of the Southeast, with double digit growth every year and tons and tons and TONS of disposable income.

If the Canes become perennial winners, the owners are sitting on a gold mine. Like, a hockey machine that prints money.

To the bolded, yes, there's a lot of IT and pharmaceutical jobs, but ********. Signed, lifelong North Carolina resident and North Carolina State University engineering graduate.

"If the Canes became perennial winners, the owners are sitting on a gold mine." Yeah, that's what I'm waiting for on the N.C. State Wolfpack Basketball Team too, perennially win. It's so easy I wonder why they haven't just gone and done it yet.

It's ridiculous to count on winning and then we'll sell out every night. By definition this is the average NHL team in a league of 30 teams: win the Stanley Cup once every 30 years, make the Stanley Cup Finals once every 15 years, make the Conference Finals once every 7.5 years, will win their regular season division once every 7.5 years, and just about every other year they'll fail to make the playoffs. And half the time they make the playoffs, they'll lose in the first round. So just about once every 4 years will the average team even make the NHL playoffs' 2nd round.

Kidding aside, the hockey team have priced themselves out of part of the captive audience and then you have demographics in the area that are a large percentage won't care about hockey period because it's seen as a white sport. Sure, if they want no one other than RTP and government employees and Cary and Apex residents to attend games, maybe it doesn't matter, but they're not getting 18k night after night just from those people. Sections of Raleigh and a couple of its suburbs are rich white-collar areas. It's not true for the region in general though. Ticket prices got jacked up, attendance went down. It also coincided with a long run of incompetence from the team, so maybe they're blaming that instead.

 

[Boom Boom Apathy]

Ticket prices got jacked up, attendance went down. It also coincided with a long run of incompetence from the team, so maybe they're blaming that instead.

The ticket price had little to do with attendance. For the past few seasons, you could get stubhub tickets to virtually any game for under $20 and there is plenty of free parking if you are willing to walk a little. You could even get season tickets cheaply.

The attendance went down for 1 reason and 1 reason only, they team stunk. This isn't unique to the Canes, nor unique to the NHL. There are only a handful of professional sporting teams where fans flock regardless of the on ice / on field product. You are right that there is a large percentage of the native population that aren't interested in hockey, but I think you are underestimating the population migration trends in the Triangle. If the Canes have a good on ice product, they'll attract fans, if they don't, they won't. It's really not much more complicated than that. It won't turn around in 1 season after 8 years of suckitude, but if they start putting a good product on the ice year after year, it will.

All that said, the reason many people buy sports teams sometimes has little to do with profit and loss. It's usually because they want to own a sports team and/or are counting on it appreciating in value. Karmanos bought the Whalers for $48M and now is selling them for 5-10 times that. Appears that Greenberg is an example of a guy that likes owning sports teams.

A big example is Jerry Jones. He was once quoted as saying his lust for owning an NFL team left him blindly intoxicated (or something like that) when he paid $140M for a team that was in huge debt and was bleeding $1M a month. The FDIC had already foreclosed on ~15% of the team and was heading to court to go after more, but Jones wanted the franchise come hell or high water. He also thought he could turn the franchise around, but his desire to own it trumped everything even if on paper, it looked like a foolish move.

I'm not saying that the Canes are anything like the Cowboys in terms of brand, following, etc..., because they aren't in that regards. I'm only saying that when people, or groups, buy a professional sporting team, there are usually reasons in play that come before profit and loss.

 

[tarheelhockey]

It's ridiculous to count on winning and then we'll sell out every night.

I'd argue that it's even more ridiculous to count on selling out without a winning team. Since when were businesses entitled to peak revenue regardless of product quality?

 

[the halleJOKEL]

i don't think a lot of people realize just how bad this team has been for the past decade. they have been the worst kind of bad. not lottery pick bad, but soul-crushingly mediocre. multiple win and you're in game 82s where they blew it. multiple horrendous starts with pointless late season surges to secure an 11th overall pick. a free agency, team building, and development strategy that was... perplexed, to say the least. there was literally nothing to be happy about watching this team since 2009 barring the all star game and skinner's calder. of course nobody is going to pay to go watch the team. it's a miracle attendance held on as long as it did before the bottom finally fell out after 7+ years of missing the playoffs and finally, at that point, starting a legitimate rebuild. it goes beyond "hurr durr the fans only watch when they win" because that has already been proven untrue. this team has been bad at an almost historic level in a league where over half the teams make the playoffs, and getting to this point has involved some of the most depressing hockey imaginable.

 

[King_Stannis]

I hope it's true for the Canes fans, stability would be nice for them right about now.

While I'd like to say that the franchise is not worth that much money you determine worth often by what a buyer would pay in an arms length transaction. So, like it or not, the Canes are worth $500mm.

 

[Joe McGrath]

i don't think a lot of people realize just how bad this team has been for the past decade. they have been the worst kind of bad. not lottery pick bad, but soul-crushingly mediocre. multiple win and you're in game 82s where they blew it. multiple horrendous starts with pointless late season surges to secure an 11th overall pick. a free agency, team building, and development strategy that was... perplexed, to say the least. there was literally nothing to be happy about watching this team since 2009 barring the all star game and skinner's calder. of course nobody is going to pay to go watch the team. it's a miracle attendance held on as long as it did before the bottom finally fell out after 7+ years of missing the playoffs and finally, at that point, starting a legitimate rebuild. it goes beyond "hurr durr the fans only watch when they win" because that has already been proven untrue. this team has been bad at an almost historic level in a league where over half the teams make the playoffs, and getting to this point has involved some of the most depressing hockey imaginable.

Not to mention they were boring on top of lousy. Always the least penalized team, and always a low scoring team.

 

[TrillMike]

Texas Rangers fan here. Stopping by in peace. Chuck Greenberg really clashed with management at the time (Nolan Ryan). If I remember correctly the last straw was him flying out to Cliff Lee to make one last/midnight offer that management wasn't comfortable with.

It's nice to see that the Canes will be staying put.

 

[Mightygoose]

Question for Canes fans or anyone in the area.

Was there rumblings of Greenberg's interest in the Canes prior to yesterday? On the surface it came out of nowhere

Not questioning the interest or price point but want to know if there's more history

 

[cutchemist42]

Yeah, can't accept the facts so lets make up up conspiracy theories.

Anyway the vultures can move on to the next team on the list of ever diminishing relocation candidates.

The NHL has knowingly done it before, so they dont get the benefit of the doubt.

 

[Svechhammer]

Texas Rangers fan here. Stopping by in peace. Chuck Greenberg really clashed with management at the time (Nolan Ryan). If I remember correctly the last straw was him flying out to Cliff Lee to make one last/midnight offer that management wasn't comfortable with.

It's nice to see that the Canes will be staying put.

Honestly, after 20 years of Karmanos taking an aggressively passive stance toward ownership to the point where he allowed the franchise to wallow in mediocrity while his GM was blowing away the future to try and reach the playoffs every year, I'm glad to see we're potentially being bought by a guy who wants to be more involved. I feel A LOT better about this knowing he helped keep the Penguins out of bankruptcy before Crosby and Malkin came to their rescue. And with Francis as the GM, I think this could be a great moment for the future of the franchise. If we have an owner who is willing to pay to win paired with a GM as savvy as Ron Francis has shown, there could be some extremely exciting years in the future for the franchise.

 

[Svechhammer]

Question for Canes fans or anyone in the area.

Was there rumblings of Greenberg's interest in the Canes prior to yesterday? On the surface it came out of nowhere

Not questioning the interest or price point but want to know if there's more history

Completely out of left field, but when it comes to the ownership situation with the team, that's how its always been. We generally don't know things until after it has happened, so if this kind of announcement has already been made and acknowledged by the franchise, it certainly seems likely to happen to completion.

 

[syc]

Not to mention they were boring on top of lousy. Always the least penalized team, and always a low scoring team.

This is something not brought up enough and something many NHL teams should address. Fans are more likely to follow a bad team that is entertaining to watch.

 

[GuelphStormer]

im not sure why some folks here are getting all bent out of shape when others are questioning the $500M figure. by any objective measure, it is a very inflated price, especially given recent rankings placing this franchise at the bottom of the league both in terms of valuation and revenues, as well as the years-long staleness of a local sale.

this all begs the question as to how much bettman simply insisted on a base "valuation" (ie., price) of $500M for every franchise sale from now on, regardless of its actual legitimate value, location or revenues.

 

[garnetpalmetto]

Salty Canadian media outlets just can't help themselves. "Struggling". Desperately trying to spin this as some kind of bad thing for the Hurricanes. God I hate the hockey establishment.



Even with all the caveats and what-have-yous here, minor league teams, especially lower than double A, move allllllllllllll the time. If a minor league baseball team is in the same town for 10 years that's a raging success. And it's a whole lot different than moving a multi-hundred million dollar major league franchise.



Holly Springs

Not to get us *too* far afield here, but I understand that's the perception but it's not one that's born out of reality. I took a look at how long each franchise in the classifications lower than Double-A (High-A, Low-A, Short Season-A, and Advanced Rookie) have been in their respective markets and found that, of the 100 franchises in those classifications the average length of time in each market is a little over 27 years.

A few ground rules:

• In the case of franchise swaps (for instance in 2001 for various and sundry reasons the owners of the Stockton Ports and the Visalia Rawhide swapped franchises), I treated that franchise as being a new team in the market (so both Stockton and Visalia have had their markets since 2001 by my calculation)
  
• In the case of changes in classification (like when the owner of the Mudcats sold the Double-A franchise to Pensacola and bought and relocated the High-A Kinston Indians) I treated the first year of that franchise as their start year, so in the case of the Mudcats, I have them as being in their market since 2012
  
• In the case of a team taking a year off (as has happened twice in the Appalachian League), I didn't consider that a contiguous run and started counting from when the franchise reactivated.

If there's fuss over any of those ground rules I'll change them, but I'd point out my choices actually favor your assertion.

That prefaced, here's the actual data. In this case I'm breaking it out by classification. I've also bolded franchises that haven't lasted 10 seasons yet to show their relative rarity (11 out of 100 teams).

High-A

Franchise|# of Seasons in Market
Bradenton | 8 Buies Creek | 1 Carolina | 6 Charlotte | 9
Clearwater|33
Daytona|25
Down East | 1
Dunedin|31
Frederick|29
Ft. Myers|26
Jupiter|16
Kissimmee | 1
Lake Elsinore|24
Lakeland|51
Lancaster|22
Lynchburg|52
Modesto|52
Myrtle Beach|19
Palm Beach|15
Potomac|34
Rancho Cucamonga|25
Salem|50
San Bernardino|25
San Jose|39
St. Lucie|31
Stockton|16
Tampa|24
Visalia|16
Wilmington|25
Winston-Salem|73
AVERAGE | 25.97 seasons

Low-A

Franchise|# of Seasons in Market
Asheville|42
Augusta|30
Beloit|36
Bowling Green|9
Burlington|56
Cedar Rapids|56
Charleston|38
Clinton|64
Columbia | 2
Dayton|18
Delmarva|22
Fort Wayne|25
Great Lakes|11
Greensboro|39
Greenville|13
Hagerstown|25
Hickory|25
Kane County|27
Kannapolis|23
Lake County|15
Lakewood|17
Lansing|22
Lexington|17
Peoria|35
Quad Cities|58
Rome|15
South Bend|30
West Michigan|24
West Virginia|31
Wisconsin|56
AVERAGE | 29.37 seasons

Short Season-A

Franchise|# of Seasons in Market
Aberdeen|16
Auburn|36
Batavia|57
Boise|31
Brooklyn|17
Connecticut | 8
Eugene|44
Everett|34
Hillsboro | 5
Hudson Valley|24
Lowell|22
Mahoning Valley|19
Salem-Keizer|21
Spokane|35
State College|12
Staten Island|19
Tri-City (NY)|16
Tri-City (WA)|17
Vancouver|18
Vermont|24
West Virginia | 3
Williamsport|24
AVERAGE | 22.82 seasons

Advanced Rookie

Franchise|# of Seasons in Market
Billings|49
Bluefield|61
Bristol|49
Burlington|32
Danville|25
Elizabethton|44
Grand Junction | 6
Great Falls|49
Greeneville|14
Helena|15
Idaho Falls|72
Johnson City|54
Kingsport|34
Missoula|19
Ogden|24
Orem|13
Princeton|30
Pulaski|10
AVERAGE | 33.33 seasons

 

[cbcwpg]

im not sure why some folks here are getting all bent out of shape when others are questioning the $500M figure. by any objective measure, it is a very inflated price, especially given recent rankings placing this franchise at the bottom of the league both in terms of valuation and revenues, as well as the years-long staleness of a local sale.

this all begs the question as to how much bettman simply insisted on a base "valuation" (ie., price) of $500M for every franchise sale from now on, regardless of its actual legitimate value, location or revenues.

You bet your bottom dollar Bettman is insisting on at least a "public" $500MM per franchise. Bettman's job is to increase franchise values because in the long haul for most teams and most owners the only real way they make any money off their teams is when they sell them. The yearly operations for a lot of teams is not a windfall if even profitable.

Think about it... the 31st ranked team in valuation according to Forbes just became $500MM. If one day the "value" of 18 NHL franchises just went thru the roof. If Bettman can set the bar at $500MM then that's great for the existing owners who want out and want to make some money.

I doubt you will ever hear of any team being sold for less than $500MM going forward.

 

[Svechhammer]

It's ridiculous to count on winning and then we'll sell out every night.

The Chicago Blackhawks averaged less than 15k fans per game in every year but one from 2000 to 2007, bottoming out at just over 12k fans per game in 2006-2007.

The Pittsburgh Penguins averaged 15k or less in 4 of 7 seasons from 1997 to 2004, bottoming out at just under 12k fans per game in 2003-2004.

The Washington Capitals averaged less than 15k fans per game in 4 out of 7 seasons between 1999 and 2007, bottoming out at back-to-back years of less than 14k in 2005-2006 and 2006-2007.

You know what cured their attendance ills? Winning. And you can see this trend throughout not just the NHL but sports in general. People don't want to pay top dollar to watch a team they don't believe can win. Yes, they have a Cup, but the Canes have been a fundamental incompetent mess since... heck, since they were in Hartford. In the 20 seasons they have been in NC, they have made the playoffs 5 times, in 1998, 2000, 2002, 2006, and 2009, and one of those appearances wasn't even in Raleigh. In a league where 53% of the teams make the playoffs, they make it only 25% of the time. In this same time period, they've watched ticket prices essentially triple, parking passes quadruple, and the volume of games on TV increase. If you ask me, its a miracle they still manage to get the fans they do.

But that's the thing. They have a strong core of fans that won't give up on the team even in some dark times. We all know the area will throw its support to the franchise once they start winning (look at the 2002, 2006, and 2009 playoff runs for proof of that), they just need to roll off a few good years in a row where they do make the playoffs, and things will get much better.

 

[tarheelhockey]

Completely out of left field, but when it comes to the ownership situation with the team, that's how its always been. We generally don't know things until after it has happened, so if this kind of announcement has already been made and acknowledged by the franchise, it certainly seems likely to happen to completion.

Yeah, news on this situation has always been extremely tightly held. This isn't a situation like Arizona where a lot of things happened in the public eye and rumors were flying around like a fireworks show.

It's been typical of this entire process that we go months with no update, then suddenly there's a report of some dogleg turn, and then we go months with no update again. This is just another one. Presumably Karmanos and Greenberg have been talking for some time without anything leaking.

WRT the franchise valuation, folks have to remember two things:

1) The team isn't the only asset involved here. Presumably this offer would also buy Gale Force, which means operating rights at the arena. That makes the $500M a much more sensible figure.

2) These numbers are always "squishy" and can be sliced and diced to create a desired impression. It's not like Greenberg would write a $500,000,000 check and get back a set of keys in an envelope. Presumably there's all sorts of financial hocus pocus going on behind the scenes which allows them to report that number, probably including assumption of debt and inclusion of future interest accruals and all sorts of other things that have little to do with the actual present-day value of an NHL franchise.