Firm offers $3.5 billion for NHL

With the 2004-2005 NHL season cancelled twice, and all the ups and downs of the 5+ month lockout, the hockey world is used to crazy news. And this story is certainly par for the course. As the owners stand pat with the goal of a salary cap and cost certainty, Bain Capital Partners LLC (a Boston investment firm) made a proposal to buy all 30 NHL teams for as much as $3.5 billion. It was presented at the NHL's Board of Governors' meeting on Tuesday in New York, with the help of Game Plan LLC (a sports advisory company that deals with franchise sales). League officials left the half-hour information session entertained by the offer, but not taking it at all seriously. There is no plan for the board to vote on the proposal, and it is unlikely that it would come close to passage. According to Game Plan chairman, Robert Caporale:

''[The proposal] would see all 30 teams run out of a central office, setting team payroll budgets before the season started and distributing revenues to each club..It's taking the National Hockey League and its 30 teams and operating it as any large corporation does with each team essentially being a division of one company. We would keep in place team management, team presidents, the GMs. They would be completely autonomous."

No matter how far-fetched this proposal is, it reminds us just how far down the ladder the NHL is compared to the other major professional leagues. And for perspective, the WNBA, MLS, and defunct XFL are examples of centrally-owned leagues. The proposal would be the NHLPA's worst nightmare, as the league would be able to nullify any deal between a free agent and a club, vastly more power than an imposed salary cap. Before the lockout, all 30 teams were worth an estimated $4.9 billion, according to Forbes Magazine. But, in the latest Forbes' figures, published on November 10, the total league value was down to $4.386 billion, and it's anyone's guess how far down that figure has gone today. Forbes NHL Team Valuations (1998-2004) *all figures in millions ($US), in order from '98 to '04, with latest figure in bold **owner, purchase price, and year below each team 1. New York Rangers: 195, 236, 263, 277, 263, 272, 282 (Cablevision, $195 million, 1997) 2. Toronto Maple Leafs: 119, 151, 203, 216, 241, 263, 280 (Ontario Teachers' Pension Plan, $90 million, 1994) 3. Philadelphia Flyers: 187, 211, 240, 250, 262, 252, 264 (Comcast, $150 million, 1996) 4. Dallas Stars: 118, 149, 182, 207, 254, 270, 259 (Thomas Hicks, $84 million, 1995) 5. Detroit Red Wings: 184, 194, 218, 225, 266, 245, 248 (Mike Illitch, $8 million, 1982) 6. Colorado Avalanche: 138, 160, 198, 243, 250, 229, 246 (Stanley Kroenke, $202 million, 2000) 7. Boston Bruins: 185, 197, 217, 230, 243, 223, 236 (Jeremy Jacobs, $10 million, 1975) 8. Montreal Canadiens: 167, 175, 191, 182, 187, 170, 195 (George Gillett Jr, $181 million, 2001) 9. Los Angeles Kings: 104, 109, 160, 189, 205, 183, 193 (Philip Anschutz and Edward Roski, $113 million, 1995) 10. Chicago Blackhawks: 170, 185, 197, 200, 218, 192, 178 (William Wirtz, $1 million, 1954) 11. Minnesota Wild: -, -, -, 135, 139, 166, 163 (Robert Naegele Jr, $80 million, 1997) 12. New York Islanders: 111, 142, 139, 156, 156, 151, 160 (Charles Wang and Sanjay Kumar, $188 million, 2000) 13. Tampa Bay Lightning: 101, 112, 107, 120, 124, 136, 150 (William Davidson, $115 million, 1999) 14. San Jose Sharks: 108, 123, 141, 148, 158, 137, 149 (Kevin Compton and Gregory Reyes, $147 million, 2002) 15. Vancouver Canucks: 100, 96, 100, 106, 110, 125, 148 (John McCaw Jr, $56 million, 1995, 50% sold to Francesco Aquilini late 2004, and approved by the Board of Governors at Tuesday's meeting) 16. St Louis Blues: 154, 137, 136, 153, 148, 147, 140 (William and Nancy Laurie, $100 million, 1999) 17. Columbus Blue Jackets: -, -, -, 145, 150, 144, 139 (John H McConnell, $80 million, 1997) 18. Phoenix Coyotes: 87, 89, 86, 79, 117, 120, 136 (Steven Ellman, $127 million, 2001) 19. Ottawa Senators: 94, 79, 84, 96, 95, 117, 125 (Eugene Melnyk, $92 million, 2003) 20. New Jersey Devils: 125, 135, 163, 175, 159, 145, 124 (Jeffrey Vanderbeek, $125 million, 2004) 21. Florida Panthers: 105, 163, 147, 115, 127, 113, 121 (Alan Cohen, $101 million, 2001) 22. Calgary Flames: 78, 78, 82, 92, 94, 97, 116 (Calgary Flames LP, $16 million, 1980) 23. Washington Capitals: 178, 145, 134, 138, 140, 130, 115 (Theodore Leonsis, $85 million, 1999) 24. Nashville Predators: -, 130, 129, 131, 132, 101, 111 (Craig Leipold, $80 million, 1997) 25. Anaheim Mighty Ducks: 109, 117, 116, 118, 111, 112, 108 (Walt Disney, $50 million, 1992, sold to Henry and Susan Samueli for $75 million recently, pending approval of the Board of Governors) 26. Atlanta Thrashers: -, -, 138, 134, 134, 110, 106 (Steven Belkin, $80 million, 2004) 27. Edmonton Oilers: 67, 72, 77, 81, 86, 91, 104 (Edmonton Investors Group, $70 million, 1998) 28. Buffalo Sabres: 91, 91, 97, 117, 92, 95, 103 (Thomas Golisano, $92 million, 2003) 29. Pittsburgh Penguins: 89, 100, 132, 149, 137, 114, 101 (Mario Lemieux, $99 million, 1999) 30. Carolina Hurricanes: 80, 70, 79, 103, 128, 109, 100 (Peter Karmanos Jr, $48 million, 1994) Some interesting tidbits are that Red Wings owner Mike Illitch bought the team for $8 million in 1982, and the Mighty Ducks, valued at $108 million, recently sold for $75 million. The latter reflects how Disney was desperate to sell the club and that NHL club values are plummeting with each day of the lockout. That said, even with the NHL valued at $4.386 billion as recent as November, the proposal to buy the league for $3.5 billion amidst the turmoil of the lockout is quite generous, a reason why the Board of Governors even entertained the offer. Another reason for the NHL to give this story publicity is that it instills fear in the NHLPA that such a league could very well come to pass. It also makes a salary cap sound much better, relative to the proposed alternative.