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Coyotes Losses A Stumbling Block For Future Investors

from Mike Sunnocks of the Phoenix Business Journal,

It’s now been a couple of weeks since there was legitimate talk that former San Jose Sharks CEO Greg Jamison was close to closing a deal to buy the Coyotes from the National Hockey League.

That talk has chilled somewhat. A Jamison bid needs to get approved by the NHL which bought the Coyotes in 2009 for a $140 million and the city of Glendale which owns Jobing.com Arena and has subsidized the team to the tune of $25 million.

...The team losses $20 million to $25 million annually.  Prospective ownership groups have struggled over the red stains on the Coyotes balance sheet and how to workout something related to the team’s losses with the NHL and Glendale.

One source who has direct knowledge of the Coyotes sale sage says that prospective buyers have come in with optimism regarding their bids only to run into stumbling blocks when investment partners see the franchise’s losses.

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Filed in: NHL Teams, d, | KK Hockey | Permalink
 

Comments

Savage Henry's avatar

Any potential owner of a franchise in a nontraditional market needs to be prepared to suffer significant losses for 10-20 years while they build a generation of homegrown (not just transplanted) hockey fans.  I realize that the Coyotes have been in Phoenix for almost that long but I’m starting to think that constant uncertainty tends to reset the clock .  Fans (and sponsors) aren’t just aren’t going to buy into a team that may not be around in a year or two.  Without stability (or a better illusion of stability) Phoenix (and a number of other fanchises) are doomed.

Posted by Savage Henry on 03/11/12 at 06:15 PM ET

aaron in phoenix's avatar

So the NHL bought them for $140 million, but wants to sell a team that loses money for $170 million? Thats one reason it hasn’t been sold. They’re asking to much. They don’t want to devalue other franchises? Well, the market supports the price. No one will pay $170 million dollars for this franchise. They need to lower the price.

And this:

The Coyotes also stayed on the sidelines during the recently passed trade deadline…

Umm…Antoine Vermette?

Posted by aaron in phoenix from Section 102 on 03/11/12 at 06:26 PM ET

Avatar

I love reading stories about the Yotes.  I mean, that franchise is a fantastic parable about what happens when greed, stupidity, hubris and obliviousness collide.

You have the clueless, stupid and oblivious City of Glendale, which in an economy that is beyond awful chooses instead to throw millions upon millions down the same stupid rabbit hole.

You have the greedy NHL led by it’s Chairman of Hubris, Bettman.  These dopes are trying to sell a team that is just about the worst investment imaginable for 30 million more than they ‘paid’... and that selling price is just for show.  If there’s an owner who will come up with more than 50 or 60 mil cash for that team I would be stunned.  They already tried to give the team to Reinsdorf a few months back and got caught and lambasted.

Oh, but sure, it’s that the Yotes have lost 7 or 8 games in a row that make the whole deal tough.  Whatever.  Bettman is apparently trying to find a prospective owner dumber and more unaware of reality than he is.

That’s a tough, tough search.

Posted by HockeyinHD on 03/11/12 at 10:29 PM ET

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Paul Kukla founded Kukla’s Korner in 2005 and the site has since become the must-read site on the ‘net for all the latest happenings around the NHL.

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