Buyer Offers $3 Billion For NHL

Two Boston companies have offered $3 billion to team owners of the National Hockey League to purchase the league en toto, but the owners are apparently cool on the idea, even though it would be one solution to its labor problems.

NHL commissioner Gary Bettman reportedly invited Bain Capital Partners LLC and Game Plan LLC to pitch their $3 billion to $3.5 billion offer to the owners March 1st in a 30-minute slideshow presentation. The owners were meeting that day to discuss their next step in the lockout that canceled the current season. They apparently weren’t too keen on the idea of selling the league, and the NHL isn’t commenting on the meeting.

“I would imagine different clubs had different feelings,” NHL Chief Legal Officer Bill Daly told Canada’s Globe and Mail. “When someone’s offering over $3 billion, we felt we had an obligation to the board to have them, at least, hear it from the proposed purchaser.”

Major League Soccer and the Women’s National Basketball Association have single owners, with teams operating as franchisees. It has helped them avoid antitrust scrutiny in the courts and provided leverage in labor negotiations. None of the other major professional sports teams have a similar structure.

“It’s incredibly creative, it’s aggressive and I don’t think it will ever work,” Sal Galatioto, president of consulting firm Galatioto Sports Partners, told The Wall Street Journal. “There are just tremendous hurdles.”

Unlike pro football and basketball, the NHL depends on a loyal fanbase in each city, rather than relying on universal appeal. The offer reportedly suggested that, if accepted by the owners, the league would focus on hockey’s niche appeal without the competition of marketing against baseball, football, etc.

“What’s wrong with that?” Game Plan Chairman Bob Caporale told the WSJ. “Let’s focus on what’s right and do the best we can to promote this game and grow the business because we understand what we are.”

Some owners might be more averse than others, namely the ones making money. On the other hand, some teams have said they will actually lose less money by canceling this NHL season than if it had been played. If the $3 billion was divided equally between the 30 teams, the profitable ones might be undervalued. Likewise, some teams own their buildings and selling off the hockey team might make the facility unprofitable.

These criticisms, of course, suppose the NHL will play this fall. The current season was called off because owners and players could not come to terms over a salary cap.

A person who attended the presentation told the WSJ the plan would likely offer equity in the league to players and current team owners.