Bill Daly is Probably Wrong – Just Like Bettman Was

coppscoliseum

NHL Deputy Commissioner Bill Daly continued the NHL’s PR war against Jim Balsillie and Jerry Moyes on Friday, claiming that there were “at least three” serious suitors for the Phoenix Coyotes before Moyes pulled the rug out of everyone’s feet and moved the Coyotes into bankruptcy.

Here are the money quotes, courtesy of TSN:

”There have been at least three expressions of interest with serious money behind them to operate this team in Glendale. The most recent expression and the one that’s farthest along would have involved all of the creditors being paid all their money back and having stable ownership and a fully funded franchise going forward.”

“The only person who generates additional cash out of the Balsillie bid for relocation to Hamilton would be Jerry Moyes. None of the creditors would get any additional money from that bid.”

I’ve got a few points to make about these quotes:

1) When Bill Daly says that the only person who will make any extra money out of this bid would be Jerry Moyes. I’m quite sure he’s wrong there; it won’t just be Jerry Moyes, it will be everyone with an ownership stake, including Wayne Gretzky.
2) Since Daly admits that Moyes is going to make more money out of a Balsillie bid, obviously none of the other three “expressions of interest” were willing to pony up as much money, and that’s a key consideration.
3) Why shouldn’t Moyes make some of his money back? Since investing his personal fortune in the club, he’s lost a ton of cash. Back in 2003 the number was pegged at $100 million by ESPN, and Moyes now puts the figure at “over $300 million”; whatever the actual number is, Moyes clearly isn’t making any money on this transaction.
4) It’s a lot easier for Bill Daly to talk about “expressions of interest with serious money behind them” than it is for a potential owner to put up more than $200 million dollars to buy the team. Balsillie’s put the money up, which is more than the NHL can say about any of these other bidders, who by their own admission aren’t offering as much money.
5) Those “three expressions of interest” wouldn’t be from these three people, would they? The reason I ask is because if the NHL approaches someone, they take a look at the books and say no, I don’t think it’s fair to call it an “expression of interest”.

Of course, all of those points are even assuming that we’re willing to give the NHL the benefit of the doubt and take them at their word; something which I personally see no compelling reason to do. In fact, I distrust virtually everything the NHL says on this front, based on what they’ve said in the past. Consider for example what Gary Bettman said back in February:

“There’s been a tremendous amount of speculation and commentary about the state of the Coyotes. I think most of it has been terribly unfair to the Coyotes organization, to the players, and, most important, to the fans. There are some issues we’re working on in terms of getting a new capital infusion for the club, which will probably take the form of some new partners for (majority investor) Jerry Moyes, or even a possible sale of the franchise. But these reports of the franchise’s demise are just ridiculous.

“I think the thing people shouldn’t lose sight of is that Jerry Moyes has been committed to Glendale, he’s been committed to the Coyotes. We’re not just talking about energy and passion, we’re talking about a huge financial commitment. He’s somebody who believes, as do I, that the future of the Coyotes is in Glendale.”

We’re working on bringing this to a conclusion by season’s end. Business is being conducted as usual, and all the rumors about things that are going wrong are simply without merit.

(bolding mine)

There’s absolutely no reason to trust the NHL on this one and there are a lot of very good reasons not to.

And It’s All About Hamilton

Of course, it may not just be Balsillie who has his eyes on Hamilton. A report in the Hamilton Spectator suggests that Vancouver-based Tom Gaglardi (who has previously tried to purchase the Vancouver Canucks) is interested in purchasing the Atlanta Thrashers and moving them to Hamilton.

A quote from the article:

Gaglardi’s group is Steeltown’s second NHL suitor. There are now rumours of as many as five groups looking at Hamilton and Copps Coliseum for an NHL team.

It almost sounds like Balsillie’s started an avalanche here, and that may end up hurting him, because I’m fairly sure that Gary Bettman would welcome Satan (and we’re not talking Miroslav) as an investor before he would welcome Balsillie. It’s a disappointing tack for Gary Bettman to take, and it wouldn’t surprise me if it eventually ends him as NHL commissioner. After all, right now he’s fighting to keep a money-losing franchise in Phoenix by finding a new owner who will pay less money than Balsillie for the team. This directly hurts NHL owners, who a) pay financial assistance to money-losing clubs and b) almost certainly wouldn’t mind seeing franchise values inflated by bids like Balsillie’s.

  • RCN

    There are few things you are overlooking.

    1) Bettman wouldn't have accepted the deal if Balsillie had said he was going to KC instead of Hamilton. When an owner buys the team, there is a clause that states if he wants to sell the team to someone to keep it in that city, he can, but having a deal that involves relocation isn't allowed.

    2) Yes Bettman screwed up in letting Quebec and Winnipeg lose their teams so easily, and that is exactly why he isn't keen on letting it happen now. The fact is, you will never have all 30 teams financially stable.

    It was only a few years ago that Washington was close to the same situation as Phoenix. Same with Pittsburgh and Chicago. And what happened, they got superstars and started to win and the fans came back.

    Phoenix has good young talent, and if the team stays I wouldn't be shocked to see them sell out. Will it last forever? No.

    Look at Colorado now that they aren't a perennial division winner. They don't sell out every game anymore. Same in Dallas.

    There will always be ups and downs. Clearly Phoenix is in dire need of support, but if the NHL allows owners to sell to whoever they want, then you'll have teams moving all over the place and that is not good for the league.

    It was only 15 years ago that right here in Edmonton there was 4-8000 fans a night. This is supposed to be a great hockey market, and even we didn't support the team.

    How many Oiler fans said, "I won't go to another game until MacT is fired", or "If they keep losing I'm done cheering". While most of those comments were from windbags, there were some of you that stopped watching. And that leads to not going to games. The key is to not have your down years last longer than four or five.

  • RCN

    AND here is another snippet…this one from Marc Edelman, a Rutgers Law School professor who has specialized in sports anti-trust cases, said it's unprecedented to have a bankruptcy court decide whether a professional sports league has violated anti-trust laws.

    "There always has been a conflict of the powers of an individual team and the power of a league. To the extent a court would overrule this, it would open up the door where an owner could sell to the highest bidder irrespective of how other teams in the league feel about it."

    This will be very interesting to see how it plays out.

  • RCN

    Jason Gregor wrote:

    It was only 15 years ago that right here in Edmonton there was 4-8000 fans a night. This is supposed to be a great hockey market, and even we didn’t support the team

    To celebrate the signing of Jason Arnott the Oilers had a one time promotion whereby they sold nose-bleed seats for only eight dollars. I ponied up the eight bucks and moved my butt down to the Golds… It was difficult to watch a team as flat out bad as that; but beer helped.

  • RCN

    @ Jason Gregor:
    My sentiments exactly.

    "Unfortunately after the game I was going to congratulate him, but he skated away with his head down. I'm sure we'll talk next game." – Canucks goalie Roberto Luongo about Hawks winger Dustin Byfuglien.

    Talk about eating pie! Vancouver sucks, if only they had a captain recognized by the league…

  • RCN

    Sure, Balsillie doesn't seem to play by the NHL's rules, and that may cost him from owning a franchise for a long time. But why would a businessman want to buy a business that's been failing under the current structure? He's guaranteed to succeed in Ontario – I'm betting that both Hamilton AND Kitchener/Waterloo could sell out nightly, each with their own franchises.

    Balsillie's offer helps the Coyote's owner pay off his debt and creditors, and to stop losing money. It also takes the business to a place where it can succeed. Why would you want to do it any other way, when you're spending millions to do it? Throwing money at any problem rarely solves it – and I'd be hard pressed to believe that simple equation will work in Phoenix.

    I understand not wanting to relocate teams, but I think Bettman's desire to grow the game in certain American centers has failed and needs to be ended. The Game is strong in Canada again – all the Canadian franchises are healthy. The NHL needs to do its footwork and get infrastructure ready in a few more places in Canada, and then grow some balls, admit they were wrong, and relocate some failing US franchises.

    If you fail at something, it is unwise to try again in exactly the same way.

  • RCN

    Travis Dakin wrote:

    @ kingsblade:
    @ Bad Seed:
    Thanks for flaunting the mighty brain power boys. I called a couple girls and they were impressed that you knew “stuff.”
    It was a simple musing…. It’s funny that the NHL is so adamant about playing by their rules when they don’t play by the rules so tightly themselves. But feel free to debunk that opinion.

    Aw that's sweet. Thanks for using my reply to sooth your flagging ego by attempting to belittle it for no reason.

    It isn't musing anymore when it is repeated and even argued. I simply explained why the "musings" made no sense. I'm sorry you don't "know stuff" but you don't have to be an a#$hole about it.

    Your comment that they don't play by the rules was the whole point. You can't make that comment when you don't know what the rules are.

  • RCN

    Jason Gregor wrote:

    AND here is another snippet…this one from Marc Edelman, a Rutgers Law School professor who has specialized in sports anti-trust cases, said it’s unprecedented to have a bankruptcy court decide whether a professional sports league has violated anti-trust laws.
    “There always has been a conflict of the powers of an individual team and the power of a league. To the extent a court would overrule this, it would open up the door where an owner could sell to the highest bidder irrespective of how other teams in the league feel about it.”
    This will be very interesting to see how it plays out.

    It will definitely be interesting because it is even less clear than you made it sound.

    While it is unprecedented there are some things that are predictable though. It could very much open the door that you just mentioned, but there is very little chance of allowing a condition like the one in question here. There are precedents for reading down the contract, meaning the court could conceivably change the condition of its own volition, meaning it could be changed from "move to S. Ontario" to "move to a new location." This would allow the sale and allow most parties to retain their rights. This is not terribly likely because courts don't like to do that very much when the person getting burned is a bona fide purchaser. (Balsillie)

    A second crazy possibility would be to strike the condition altogether. There are precedents and the court has the power to do it, but again they would be hurting the last party the want to hurt.

    This means the judge is essentially going to be deciding between the rights of the creditors and the rights of the NHL, an odd situation. The NHL really hurt themselves when they failed to find a second buyer for the team because at this point they are essentially asking the court to deny all creditors their money until the NHL decides to arrange their repayment. Certain judges may find this terribly offensive.

    This got really long, but in short – I think this may just end up opening door for purchasers, but I really doubt it will open the door for forced relocation. Edelman's statement is a bit over the top because, while it is unprecedented in a bankruptcy court, there are precedents to work with to examine the options.

  • RCN

    .kingsblade wrote:

    Aw that’s sweet. Thanks for using my reply to sooth your flagging ego by attempting to belittle it for no reason.
    It isn’t musing anymore when it is repeated and even argued. I simply explained why the “musings” made no sense. I’m sorry you don’t “know stuff” but you don’t have to be an a#$hole about it.

    Reason being is you're one of those people that come on here and argue with absolutely anything even if it is not something that needs to be argued. And I do know "stuff", but I don't need to have the safety net of an anonymous name and ample time to think of fancy ways to over articulate my responses before I press send or enter. Lighten up I was teasing you

  • RCN

    kingsblade wrote:

    Thanks for using my reply to sooth your flagging ego

    The only thing I use to sooth my flagging ego is a set of abnormally small hands. I can't play a piano but EVERYTHING looks ridiculously big when I hold it. Optics is the key.

  • RCN

    Your third point is absolutely right. For Daly to say "The only person who generates additional cash out of the Balsillie bid for relocation to Hamilton would be Jerry Moyes." makes him look like an idiot. Why shouldn't a guy who sank millions into Bettman's "NHL in the American sunbelt" (pipe)dream not get some of his money back. In my opinion this quote does nothing to strengthen his case to any reasonable obeserver and merely demonizes someone I'm sure a lot of hockey fans feel bad for…. I mean if Phoenix and the other southern teams were sucessful and the NHL were on it's way to being a top tier league with serious TV money the topic of a 7th canadian team would be pretty far sown the list of concerns an average fan might have.

  • RCN

    Sorry, Jason, do you think that Bettman may end up in trouble as far as ownership support? It seems to me that when you have someone offering alot more than a francise is worth, Not taking it is a bad idea. But more than that, after telling these owners that they needed a salary cap, getting it, but then it went sky high, isn't there becoming alot of tension between him and the owners?
    I'd love to see more Canadian teams, Hockey should be played where people love the game.

  • RCN

    Jason Gregor wrote:

    1) Bettman wouldn’t have accepted the deal if Balsillie had said he was going to KC instead of Hamilton. When an owner buys the team, there is a clause that states if he wants to sell the team to someone to keep it in that city, he can, but having a deal that involves relocation isn’t allowed.

    As much as I would like to believe that Bettman is concerned with the letter of the law when it comes to Ownership, I doubt he consideres the rules little more than rough guidelines. *cough…Boots Del Biaggio…cough*

    If Balsille wanted to move the team to KC then he wouldnt have to play his hand publicly. Doing these dealings in the public eye ensures the inability of the NHL to ignore his actions or to sweep everything under the rug. The league CLEARLY does not want to come back into Canada, so maybe Balsille feels like this is the only way to create a fair playing field.

  • RCN

    Travis Dakin wrote:

    Reason being is you’re one of those people that come on here and argue with absolutely anything even if it is not something that needs to be argued. And I do know “stuff”, but I don’t need to have the safety net of an anonymous name and ample time to think of fancy ways to over articulate my responses before I press send or enter. Lighten up I was teasing you

    The things is…I wasn't arguing. It was "mused" that the NHL might break laws by regulating team locations, and I did nothing but explain why the league does not have to answer to many anti-trust laws. That hardly qualifies as an argument.

    I also like how you tell me your post was for arguing too much, insult me, and then tell me you were only teasing. That's not really how a "lighten up" speech usually works. I've been in exactly 6 arguments on this site in total, I'm pretty sure that's not a record, and I'm sorry if you don't like the way I speak. The ways my words come out is actually the opposite of your assumption, in that I write too fast and don't have time to dress my statements down for you.

    Safety net? 1) It's pretty presumptuous to assume anything about how much time I have to spend on here posting, especially since I post about a quarter as often as you. 2) I hate to tell you this but "Travis Dakin" is every bit as anonymous to me as "Kingsblade" is to you, and I'm pretty sure you must feel fairly anonymous because I'm pretty sure you wouldn't be so quick to insult people you don't know to heir face and tell them to lighten up.

  • RCN

    Chris wrote:

    @ kingsblade:
    Wow. You’re just making friends everywhere you go.

    Why are you here to make friends? I'm here to read about and discuss the Oilers.

    Pardon me if I find it irritating when I explain something someone clearly doesn't know and he decides that would be a good time to insult me. At least he's a decent sort who happened to irritate me yesterday. You're just irritating altogether.

  • RCN

    I don't believe that the Winnipeg and Quebec relocations were Bettman's fault. The Canadian $ was in horrible shape and the future looked bleak. Both cities had poor buildings and there was no will by the communities to invest in one. Both buildings made Rexal place look like the Taj Mahal.

    In Winnipeg, the Jets owner tried to sell the team to a local owner for over a year at a below market price. No one would step forward.

    You can't pin that on the NHL.

  • RCN

    As for Balsillie and Hamilton, if I was a current NHL team owner in Florida, Atlanta, Phoenix, the Island, or Tampa Bay, I would be screaming BLOODY murder if they let an outsider into the plumb Ontario market.

    Think about it. You dump millions into a tough market and they let some jackass with a checkbook set up shop in a goldmine – circumventing all league bylaws and procedures.

    Wouldn't you like to have had first rights on that given that you've already invested years and millions into the NHL?

  • RCN

    @ Chris:
    @ kingsblade:
    @ Travis Dakin:

    This is basically the most intensity that anything connected to the word "Oilers" has seen in weeks. Bring the heat!

    Question

    Did anyone else think MacTavish would have had a press conference by now? Uh what is the deal there exactly?

  • RCN

    Wanye Gretz wrote:

    Did anyone else think MacTavish would have had a press conference by now? Uh what is the deal there exactly?

    I guess he didnt want to be pelted with rotten fruits and vegetables by the rabid mob.

  • RCN

    Wanye Gretz wrote:

    Did anyone else think MacTavish would have had a press conference by now? Uh what is the deal there exactly?

    I wonder if he's waiting until he has a new job before addressing the public. I sure expected something by now.

  • RCN

    Just watched the Reporters on tsn.ca discuss the Phoenix/Balsillie situation and one of them makes an interesting point in that if Balsillie merely tried to buy Nashville unconditionally (instead of forcing his way) and tried operating there, he probably would have been able to move that team to Hamilton right now like Karmanos did with the Hurricanes in Hartford.

  • RCN

    The question about Southern Ontario, is whether or not the league does not want to go there, or perhaps more likely, knows that they can get 300 mil + from Balsillie (or somebody else for that matter) for an expansion franchise. The league won't get that much from other markets such as KC, Seattle, Portland, Houston, etc. But they may be able to in Canada (and maybe even Vegas).

  • RCN

    TonyT wrote:

    Just watched the Reporters on tsn.ca discuss the Phoenix/Balsillie situation and one of them makes an interesting point in that if Balsillie merely tried to buy Nashville unconditionally (instead of forcing his way) and tried operating there, he probably would have been able to move that team to Hamilton right now like Karmanos did with the Hurricanes in Hartford.

    That would not have been a very smart move. He knows Bettman has a personal problem with him and would do everything in his power to stop the move. That would leave him stuck with a team losing piles of cash for which he paid over 200 million.