This upcoming NHL off season should be an interesting time, might be the best chance for Balsillie to aquire a team.
NHL teams courting RIM's Balsillie
Theresa Tedesco, Chief Business Correspondent, National Post
Published: Tuesday, June 03, 2008
As many as eight National Hockey League teams have been in discussions or made overtures to Jim Balsillie in recent months about a possible sale or minority partnership with the Canadian billionaire, sources say.
A struggling U.S. economy, strong Canadian dollar and weak hockey markets south of the border have combined to make the deep pockets of the 47-year-old co-founder of the BlackBerry device too irresistible to some NHL owners, despite Mr. Balsillie's tempestuous relations with the league's head office in New York.
Since last December, Mr. Balsillie, who has an estimated net worth of US$1.6-billion according to Forbes magazine, has both received and initiated approaches with the owners of NHL clubs, according to sources familiar with the discussions.
Mr. Balsillie, the co-chief executive of Research in Motion Ltd., declined to comment on Tuesday.
However Richard Rodier, a special advisor to the Canadian billionaire, confirmed there have been discussions with current NHL owners, although he refused to identify the teams.
"Our experience has been that there is certainly no shortage of owners who want to sell their team right now but we have to be very careful about the market," he said. "If the team were doing well financially in the applicable market, one can assume the owner would have no interest in selling it."
Of the eight ownership groups who engaged in talks and negotiations with Mr. Balsillie, several represent NHL teams in the southern United States, including the Atlanta Thrashers, Carolina Hurricanes, Tampa Bay Lightning and Dallas Stars. An offer was tabled by Mr. Balsillie for the Buffalo Sabres last December but was scuttled when he insisted on moving the team to Southwestern Ontario.
Other discussions involved partners in groups that own teams, for example, the Edmonton Oilers, where one of the 34 partners had expressed an interest in selling his stake to Mr. Balsillie.
In any event, Mr. Balsillie, a fiercely patriotic hockey fan, has said he is not interested in owning an existing Canadian team. Nor does he want to move a franchise from one Canadian city to another.
According to insiders, the Waterloo, Ont.-based businessman maintains a firm desire to relocate a team from the United States to Canada, most likely to Hamilton, Ont., and refuses to accept conditions that include a prohibition from moving a team that is struggling in its current market.
Bill Daly, deputy commissioner of the NHL, confirmed Tuesday the league is "aware" that "contacts" have been made between Mr. Balsillie and some team owners.
"To the extent that there are those kinds of communications, I am not necessarily surprised," he said. "Whenever you're dealing with businessmen in these types of situations, you are looking at your options all the time. I don't think there's an abnormality in those types of contacts from time to time."
Wayne McDonnell, a clinical assistant professor of sports management at New York University, says a slowdown in the U.S. economy is creating a "buyer's market" in the 30-team league.
"We are in for some tough economic times and if you're buying a hockey franchise, you're likely going to get a discount," he explained. "Owners are looking at a quick opportunity to sell a franchise for more than they paid for it, especially because there are some very weak U.S. markets the NHL calls home."
Prof. McDonnell, who worked as a financial analyst and accountant at Madison Square Garden and Radio City Music Hall in New York, said there are "always going to be owners who shop their teams because the NHL over-expanded into markets they quite frankly don't belong in, especially in the U.S."
For example, Prof. McDonnell is skeptical of the league's move into such "interesting and unchartered" cities as Nashville and Columbus, where he says the vast majority of the community is employed by Ohio State, which supports football and basketball.
"I look at them, I shake my head and ask, ‘are they valuable, fruitful markets for the NHL?' "
In the end, Prof. McDonnell says, "Hockey is a tertiary sport in the U.S.," adding, "I think the NHL's lifeblood is Canada or more into the international markets than it is in the U.S."
In December, 2006, Mr. Balsillie withdrew his US$175-million offer to purchase the money-losing Pittsburgh Penguins after the NHL tried to impose a series of conditions on the sale of the team, including a clause that would have prevented Mr. Balsillie from relocating the Penguins for at least seven years.
Last year, his attempt to purchase the financially-crippled Nashville Predators for US$238-million ended in similar failure after the league refused to consider Mr. Balsillie's request for a consent to move the team at the same time the board of governors voted to approve his ownership.
Canada's federal Competition Bureau investigated the NHL's relocation practices and policies on ownership transfers last year. The anti-trust watchdog ruled on March 30 that the NHL's policies are not anti-competitive.
National Post
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