Preds Sold-Could Be Gone

Preds owner sells team
Leipold ready to cut deal with Canadian billionaire


[FONT=Arial,Helvetica,Sans-serif]Craig Leipold has said he wants the team to stay here. [/FONT]By BRAD SCHRADE,
DAVID CLIMER
and JOHN GLENNON
Staff Writers


Published: Thursday, 05/24/07 Nashville Predators owner Craig Leipold intends to sell the hockey team to Canadian businessman Jim Balsillie and an announcement could come today, according to sources familiar with the deal.
Word of the sale sparked talk that the team would move, ending the uneasy residence of hockey in Music City — where football is king. Team supporters have long bemoaned a lack of the corporate support that buoys teams elsewhere in the league.
The Predators just finished year two with attendance averaging less than 14,000 per game. Their contract says they can leave if next season falls below that number as well. The Predators would have to give notice next month, but executives have denied they intend to do so — and just signed a new naming-rights deal for their home arena.
Still, the sources said the sale has been in the works for weeks, and Leipold has signed a letter saying he intends to sell.
"Both parties intend for it to happen subject to final" documentation, said one source, who spoke to The Tennessean on condition of anonymity. "The purpose for the letter of intent is to demonstrate the degree of seriousness of both parties."
Leipold called team employees together in Nashville on Wednesday to inform them of the impending sale.
A sale to Balsillie would raise the question of whether the team would stay in Nashville. The sources did not know the answer.
Balsillie is co-CEO of Research In Motion, the Waterloo, Ontario-based company that makes Blackberry handheld devices.
He tried to buy Penguins
Last fall, Balsillie offered
$175 million for the Pittsburgh Penguins. Balsillie dropped the offer when NHL Commissioner Gary Bettman attached a long list of conditions to the sale, including a commitment not to move the team out of Pittsburgh for seven years regardless of financing for a new arena. It's not clear if any conditions are involved in a deal for the Predators.
"He has until the end of June to go through due diligence and to close the deal," one source said. "What I've been told is that's pretty much finished and they're not anticipating any problems."
The Predators were saying little last night.
"We're not going to confirm or deny any reports or speculation at this time," club spokesman Gerry Helper said.
Balsillie could not be reached for comment.
Mayor Bill Purcell was not contacted by the Predators' management about a sale, which he learned of from news reports, spokeswoman Molly Sudderth said.
News shocks fans
Fans were startled as news of an impending sale circulated.
Nashville's Patty Cavanah wept.
"Devastation. Absolutely. I'm a season ticket-holder. Die-hard fan. ... I'm in shock," said Cavanah, who has been a season-ticket-holder since the second year. "The guy who supposedly is buying them is a billionaire who has tried to buy other NHL franchises and move them to Canada.
"If that happens, I blame the current administration of the city. I blame the local media for non-positive support. And I blame corporate for non-support."
Tom Romanoff, a season ticket-holder who goes to the games with his nephew, Chris Baumann, 16, said: "Wow. It's kind of amazing. It's kind of a shock. I hope they don't move."
Just last week, Leipold and the team signed a multi-year naming-rights deal for Nashville's hockey arena with Franklin-based Sommet Group. The revenue from that agreement goes to the team.
On Jan. 11, Leipold said he was looking for one or more local investors to buy up to 40 percent of the team in the hope that local owners could boost attendance.
No local buyer or buyers stepped forward.
When asked last month about potential new investors in the Predators, Leipold said keeping the team in Nashville was a requirement for anyone interested. Leipold brought the expansion team to Nashville in the fall of 1998.
"When I'm talking with people, it's all under the provision that this team is staying in Nashville, and if you're interested, come on and we'll continue to talk. Those people are the ones I'm restricting it to, the ones who have an interest in maintaining a team in Nashville.''
Ticket sales fall short
The NHL Board of Governors, which includes a representative from each of the 30 NHL teams, must approve the sale or relocation of any franchise. As recently as last month, Bettman told a media gathering in San Jose, Calif., before a Predators-Sharks playoff game that there were no plans for league expansion or relocations.
The announcement comes as the Predators are in a season-ticket drive. The team sold slightly fewer than 9,000 season tickets last season, up from the previous year.
The Preds averaged 13,815 in paid attendance last season, below the 14,000 benchmark.
If paid attendance does not average 14,000 next season, the team could pay an exit fee of approximately $18 million and leave Nashville. The money is to help cover the expenses the city paid to bring the team to Nashville.
However, Metro could pay the difference between revenue from the actual paid attendance and 14,000 to hold the team to the lease.
The owner must give the city a one-year warning before leaving. He has until 60 days after the end of 2006-2007 season to declare whether he would consider exercising the out option after next season. The Preds' last playoff game was on April 20, which means that notice would have to come by around June 19.
At last week's announcement of the naming-rights deal, Leipold had taken off the table the possibility that he would exercise the option.
Leipold couldn't be reached for comment on Wednesday. Someone who answered the phone at Leipold's home in Racine, Wis., said he was not expected to return before today.

Published: Thursday, 05/24/07

 

good. fair-weather pricktards in tennessee don't deserve an NHL franchise anyway.

 

ACtually it is sad. A lot of people from NY and the Midwest supported this team quite well. Plus they put out a pretty damn good product.

 

Fuck that cock sucker Basille.

 

Letter from owner Craig Leipold

May 24, 2007



Dear Predators fans,


June 25, 2007 will mark the 10-year anniversary of the awarding of the NHL franchise to Nashville that became your Nashville Predators. It’s been an incredible 10-year journey for me. I can’t tell you enough how much I appreciate your strong emotional and financial support of the Nashville Predators. You are a big part of the team’s on-ice success. On behalf of the entire franchise, I thank you.

Ten years ago, I couldn’t call myself a hockey expert. Today, my family and I are as passionate and competitive about the game as the most hardcore fans.

When the franchise began, I said we would run it as a business in order to be successful. We developed a game plan both on and off the ice. We became an integral part of the community, especially downtown Nashville. We made sure we had some fun. And, we indicated that making a huge profit was not a top priority – but we certainly didn’t make plans to lose a significant amount either.

As part of those plans we developed a loyal fan base – every team should be fortunate enough to have a Cell Block 303 and the loudest arena in the league. We built a team that the community could be proud of on and off the ice. We grew our hockey skills exactly as general manager David Poile outlined, using the draft as a foundation and then supplementing at the appropriate times with trades and free agents. We gave back to the community – well over $2 million in grants and in-kind donations through the Nashville Predators Foundation. We created an entertaining in-arena atmosphere for every game night. And, we did it all while keeping our ticket prices near the bottom of the league.

Unfortunately, the success on the ice has not translated to success for me as business owner.

Here are just a few facts as to why:

The Nashville Predators tallied up 216 points in the last two seasons, fifth most in the NHL, yet because of below-average attendance, the team will still have a real cash loss of $27 million during that time. Additionally, that loss is despite receiving the most money in the league from revenue sharing. Over the last five years, the team has lost over $60 million.
We’ve invested heavily in sales and marketing efforts, spending over $50 million in 10 years, most of that with locally-based businesses.
Our average regular season attendance this past season was 13,589, up from the year before, but still 2,000 below the NHL average. A low turnout, combined with a low ticket price results in a poor financial situation.
The new NHL Collective Bargaining Agreement with revenue sharing is not a cure-all. Each local market must still support its local team. In addition, this attendance does not qualify us for our full revenue sharing allocation under the collective bargaining agreement.
While individual fan support has always been strong, we’ve worked aggressively to increase our local business support since Season Four. We’ve tried a variety of approaches with minimal success. Our records show today that corporate support for the Nashville Predators makes up about 35% of our season ticket base. The average in other markets is around 60%. During our first two years, approximately 4,000 businesses owned season tickets. Today, only 1,800 businesses have season tickets.
While my heart and my love of the game tell me we can still be successful, the facts outlined above suggest otherwise. I’ve reached the only possible conclusion and it’s one of the most difficult decisions of my personal and professional life.

Later today, I am announcing an agreement to sell the Nashville Predators franchise and Powers Management to Jim Balsillie. We plan for the sale to be final in early July after a short period of due diligence and approval from the NHL Board of Governors.

I’ve carried the franchise as far as it can go from a business standpoint. It has been well-reported that we have attempted to attract local ownership since 2002. The truth is, we had only one serious inquiry in that time from someone who was interested in a small minority share of the team. Jim Balsillie is interested in full ownership.

It’s time to give someone else a chance to take the Nashville Predators to the next level in terms of local business support. Last week’s announcement that the Sommet Group has signed on as a naming rights partner for the arena is a strong first step in the right direction. The new energy and leadership of Jim Balsillie will be another.

Jim Balsillie is co-CEO of Research in Motion, the company which developed the Blackberry device. He is an avid hockey fan who still plays recreationally. I know he is dedicated to putting a great team on the ice.

The past 10 years have laid a foundation, but there’s still much to be done to both build corporate support and to win a Stanley Cup. I know Jim shares my passion for the game and my commitment to a strong franchise to pursue the greatest trophy in sports.

Despite the financial challenges we faced, owning this franchise has been the thrill of a lifetime. I’ve made many friendships here in Nashville. It’s been an exciting 10 years, and as I move on from the ranks of team ownership, I’ll always remain a fan.

Sincerely,

CLL



===========


It sounds like unless the bizness community in the Nashville area fills in the gap by buying more season tixs, this team will be moving next year. If business only make up 35% of your season tix base, then you have to heavily rely on walkup sales to fill in the gap. That's not going to happen in a non-traditional hockey market.

Likely location of the Preds in 2008-09:

1) KC-Sprint Center will be ready this year
2) Houston-4th Largest TV Market in the country.
3) Oklahoma City-At some point, this city will get an NBA or NHL Franchise
4) Portland-Paul Allen owns the ROSE GARDEN again. I'm sure he is looking for more dates to fill the arena to make more money.

 

Sounds like the Hornet leaving.....

 

Maybe they should move to Buffalo. I hear they need a good hockey team.

 

UGH

Another shot at NHL team for Hamilton

​

The Canadian Press File PhotoCo-CEO Jim Balsillie, right, is anxious to wrap up the HECFI talks within a couple of weeks.


Council met last night with RIM boss Jim Balsillie and agreed to reactivate deal for Copps Coliseum

By Andrew Dreschel
The Hamilton Spectator(May 31, 2007) Hamilton has re-activated an agreement with Waterloo billionaire Jim Balsillie giving him exclusive rights to bring an NHL team to Copps Coliseum.
As part of the deal, the city is also negotiating to give Balsillie the right to run Hamilton Place and the Convention Centre -- if he brings a team to town.
The move comes on the heels of Balsillie, co-CEO of RIM, the company that makes the BlackBerry communications device, agreeing to buy the NHL's Nashville Predators for $220 million.
Balsillie approached the city late last week through Toronto attorney Richard Rodier.
That led to a flurry of behind-the-scenes discussions, including a telephone call between Mayor Fred Eisenberger and Balsillie.
"He has assured me that he wants to secure a team and he is interested in bringing it to Hamilton," Eisenberger said last night. "Certainly he has the resources to do it and we will leave it up to him to pull it together."
After going behind closed doors last night, council supported going forward with the two-step agreement and negotiation process. Reached at his office, Rodier declined to comment.
But if the NHL board of governors approves the sale of the Predators, Balsillie is widely expected to move the money-losing team to a new city, possibly in Ontario.
The fact Balsillie, operating as Golden Horseshoe Sports and Entertainment Inc., moved so quickly to once again sew up exclusive rights to Copps -- rights he let lapse last fall -- indicates Hamilton fits into his plans as either a possible location for the team or as a pawn to leverage other negotiations.
The new twist of linking exclusive rights to Copps with running all the city-owned venues connected with Hamilton Entertainment and Convention Facilities Inc. (HECFI) strongly suggests Hamilton may be more than just a bargaining chip.
Councillor Terry Whitehead, the city's NHL point man, says bringing an National Hockey League team to Hamilton remains a hard sell.
Two previous bids to snare a franchise tripped over a combination of brush-offs from NHL brass and the presumed hurdle of paying millions in compensation to Toronto and Buffalo owners for trespassing on their territorial rights.
Whitehead remains skeptical but open-minded.
"We always knew it was going to be an uphill battle, but it's nice to have someone in there like Mr. Balsillie who is prepared to enter the fight," he said.
"It's far better for us to support something like this than sitting back and never having this kind of opportunity."
Councillor Tom Jackson, who also sits on the NHL subcommittee, points out there are still negotiations around HECFI to be worked out, but he's cautiously looking on the bright side.
"I wouldn't waste my time and effort on supporting this if I didn't think there was at least a legitimate opportunity this time around," said Jackson.
Sources say Balsillie's people are eager to wrap up the HECFI talks within a couple of weeks.
Under the proposed terms, the city would retain ownership of HECFI buildings but Balsillie would operate and manage them if he brings a team to Steeltown.
The Copps portion of the deal reportedly mirrors key points in the exclusivity agreement the city negotiated with Rodier, on behalf of a mystery client, now known to be Balsillie, in 2004.
Balsillie would be responsible for leasehold improvements, including upgrades and the expansion of corporate boxes or suites to bring the 17,500-seat arena up to modern NHL standards.
Rodier notified the city it was cancelling that agreement last October, just days after Balsillie signed an agreement to purchase the struggling Pittsburgh Penguins.
The cancellation suggested he was either trying to allay fears in Pittsburgh that he intended to move the team or Copps simply no longer figured in his plans.
Regardless, Balsillie backed out of the Pittsburgh purchase because of NHL conditions and obviously went hunting for another team. Now he's back at Hamilton's door.
But we're not the only city wondering what the billionaire's game plan is. Speculation is rife he may also be looking at building a hockey stadium near Kitchener.
Hamilton's advantage, of course, is we're smack in the middle of the hockey-hungry Golden Horseshoe with an arena already waiting to be filled.
Andrew Dreschel's commentary usually appears Monday, Wednesday and Friday. [email protected] and 905-526-3495.

 

3,000 tickets still available for the season opener. doomed.

 

Didn't the league wind up saying this guy couldn't buy the team?