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SBD/May 11, 2011/FranchisesPrint All
The Glendale City Council agreed 5-2 yesterday to pay the NHL "up to an additional $25 million so the Phoenix Coyotes could stay another year in the desert," according to Rebekah Sanders of the ARIZONA REPUBLIC. The pledge "allows Glendale to continue work on an arena lease" with prospective team owner Matthew Hulsizer through the '11-12 season. Glendale in return "agrees to cover team and arena losses for a second season of up to $25 million, until a team buyer takes over." Glendale "made a similar bargain a year ago." The city paid $25M to the NHL this month to "fulfill the pledge it made last year to keep the Coyotes through the recently ended season." One "difference in the current agreement: the NHL obtains the right to renew the agreement yearly for 10 years" (ARIZONA REPUBLIC, 5/11). Glendale Mayor Elaine Scruggs emphasized, "This is a payment for a service. This is not a subsidy. ... We are keeping our community arena open for business. We are keeping that arena generating revenue." NHL Deputy Commissioner Bill Daly before last night's vote told the council that the league "remains committed to keeping the team in Arizona." He said that he "hadn't anticipated being back for another $25 million, that the league thought it had a buyer" in Hulsizer, but he "indicated the league could seek another buyer." Daly said, "We're much closer to the finish line. I think we are getting there whether it is with Mr. Hulsizer or another potential buyer" (AP, 5/11).
LEGAL MANEUVERING: The AP's Bob Baum reports the NHL is "considering a legal move to clear the way for the sale" of the Coyotes to Hulsizer. Daly after last night's vote said, "We really need to step back and look at next steps. And maybe it is to clarify the legal position and move forward with that structure. That might clear a lot of things up. Maybe it's restructuring (the Hulsizer deal). Maybe it's a new investor with a new deal. Those are all possibilities and (Tuesday's) resolution will give us an opportunity to explore those." He added that there is "no deadline but hoped a sale could be completed by the end of the summer" (AP, 5/11). Glendale "continues to court" Bulls and White Sox Chair Jerry Reinsdorf to buy the Coyotes "even as it tries to finalize a sale of the team" to Hulsizer (BIZJOURNALS.com, 5/11).
GETTING OFF THE ICE: The ARIZONA REPUBLIC's Sanders reports minority-investor group Ice Edge Holdings "has withdrawn from the group led" by Hulsizer that is attempting to buy the Coyotes. The "tipping point was learning Friday about the council vote." The "next day, Ice Edge notified Hulsizer that it was pulling out of the ownership group." Ice Edge CEO Anthony LeBlanc: "It was purely a decision based on the fact we have been involved with this for two years. We just didn't feel comfortable spending any additional time on it." Brad Goldberg, a spokesperson for the Hulsizer group, said that Ice Edge's departure "would not hurt the deal with Glendale." LeBlanc said that "other minority investors are still involved, and Hulsizer would be able to replace Ice Edge's financial contribution." He declined to be specific but said it was "a small amount" (ARIZONA REPUBLIC, 5/11). LeBlanc said that his company will "concentrate on its minor league hockey operations" in Thunder Bay, Ontario. He added that he "plans to run for political office there" (TORONTO STAR, 5/11).
Astros Owner Drayton McLane's $680M deal to "sell the Astros to a group headed by Jim Crane could be completed as early as next week," according to sources cited by Levine & Justice of the HOUSTON CHRONICLE. An MLB official said that ownership of the Astros "could be transferred as early as July after Major League Baseball finishes its examination of the deal and its investors." Sources said that Crane's ownership group "includes 'eight to 10 individuals,' almost all of them from the Houston area." The deal "will include the Astros' share of a regional sports network to launch in 2012." Crane also "would take on the remaining 18-plus years on the Astros' lease at Minute Maid Park, owing $1.7 million payments to the Harris County-Houston Sports Authority every six months." McLane said that the "possibility he had left open during a November news conference to retain some stake in the team's ownership was not discussed as part of the deal" (HOUSTON CHRONICLE, 5/11). McLane yesterday said that he is "still in negotiations to sell the club to Crane, but he did not say a deal was in place." McLane: "I haven't signed anything, Jim Crane and his group haven't signed anything and Major League Baseball hasn't signed anything. We're still negotiating, so there's nothing to report" (MLB.com, 5/10).
EARLY ISSUE TO ADDRESS: In Houston, Richard Justice writes among Crane's "first difficult questions will be whether to keep Ed Wade" as the Astros GM. The Astros are an NL-worst 13-23, and Justice writes firing Wade "would be popular," but it "might also be wrong." Justice: "As bad as the Astros are now, they're in significant better shape than when Wade arrived in 2007." Wade has "overhauled the scouting staff and replaced instructors and managers up and down the minor-league food chain." He has "convinced McLane to get draft picks signed and into uniform," and he has "convinced McLane that the Astros must have a significant presence in the Dominican Republic." Justice writes Wade's "good work is just beginning to pay dividends" (HOUSTON CHRONICLE, 5/11).
The Ontario Teachers’ Pension Plan is "moving aggressively to tidy up the ownership" of Maple Leaf Sports & Entertainment, a "bid to smooth the way for a sale," according to Perkins, Robertson, Grange & Parkinson of the GLOBE & MAIL. OTPP, which already holds two-thirds of MLSE, “struck a deal to buy” Toronto-Dominion Bank's 13.46% stake in the company. The deal will “simplify an auction process that has been under way since March.” But it does not change the fact that Chair Larry Tanenbaum, who "owns the second-biggest interest in MLSE," is “still the kingmaker in this process.” Sources said that he is “in no rush to make a decision.” Tanenbaum yesterday “met with a private equity official” from OTPP in Toronto. He now “has the right to buy one-fifth of TD’s stake.” With TD’s 13.46% interest, OTPP would hold 79.53% of MLSE. If Tanenbaum “buys in,” OTPP would hold 76.35%. Morgan Stanley, which is advising on the sale of MLSE, has “not yet opened up the books to potential buyers” (GLOBE & MAIL, 5/11). In Toronto, Tony Van Alphen notes OTPP’s bid for TD’s shares would “make the sale of its own majority stake in the franchise more attractive to a suitor.” Tanenbaum and his firm Kilmer Capital “holds the other 20 per cent of MLSE.” Sources said that OTPP is “seeking about $1.3 billion for its current 66-per- cent in MLSE," which includes the Maple Leafs, Raptors, MLS Toronto FC, AHL Marlies, Air Canada Centre, Maple Leaf Square condominium development and "two specialty television channels." Sources said that TD “has sought a buyer for several years.” One insider said, “It made money on its original investment and has wanted to get out for some time” (TORONTO STAR, 5/11).
Rising salaries for players, a "sharp decline in attendance and lingering issues with their Nationwide Arena lease have the Blue Jackets projecting losses of approximately $25 million for the 2010-11 season," according to an NHL source cited by Aaron Portzline of the COLUMBUS DISPATCH. The team's "financial distress has been known for two years, but this season's projected losses -- despite $12 million to $13 million in revenue sharing expected from the NHL this summer -- represent a staggering increase." The Blue Jackets "lost roughly $14 million in each of the previous two seasons." The deeper losses come at a time when two NHL franchises -- the Coyotes and Thrashers -- "seem on the verge of relocation." The NHL source said the Blue Jackets should not be "part of that conversation with Atlanta and Phoenix yet. But they need a solution, and quick." The team averaged 13,350 fans in Nationwide Arena this season, an average of 2,067 per game fewer than in '09-10 and "by far a franchise low." Because the Blue Jackets "didn't average 14,000 fans per game and didn't match the NHL's revenue growth rate, they will lose 25 percent of their revenue-sharing check from the NHL." Despite the losses, Blue Jackets President Mike Priest said that Exec VP/Hockey Operations & GM Scott Howson is "under no orders to cut payroll." Priest "would not comment on the team's future in Columbus." However, he said Owner John McConnell "is committed to winning and building the best franchise, and he's committed to finding a resolution" (COLUMBUS DISPATCH, 5/11).
The Wizards yesterday unveiled new uniforms, and with all of Ted Leonsis' teams "now wearing red, white and blue, the owner has completed what he calls the first step toward his goal of paying homage to the past while looking ahead to the future," according to Carla Peay of the WASHINGTON TIMES. Bullets/Wizards Alumni Association Dir Bob Dandridge: "Going back to the old uniforms, the old colors may raise the awareness of how great a franchise this is." The uniforms, unveiled "before a crowd of fans, season-ticket holders and guests," have "what the team described as 'secondary logos.'" The "d" in Wizards is a "model of the Washington Monument, and the lowercase 'd' in 'dc' on the shorts mimics the iconic Bullets logo [of] two hands reaching up to touch a basketball." Wizards G John Wall said, "I like them. I like the DC with the monument and the little star. ... It's like an old-school type jersey. I wish last year we could have worn it. It's unique. We're the nation's capital team, so why not be red, white and blue?" (WASHINGTON TIMES, 5/11). Leonsis yesterday said, "People really wanted some kind of connective feeling to what was good about the past here. And so the league said we could change the colors, and we really pushed the envelope. It's the Wizards, but it really looks different." Leonsis noted that he has not had any conversations with late Wizards Owner Abe Pollin's widow, Irene, "about going back to the Bullets." Leonsis: "I think changing the name, sometimes it's almost like a grandstanding thing. I mean, it's a cheap way to get people to support you" (WASHINGTONPOST.com, 5/10). Leonsis added, "We rebranded the team and really went back to that red, white and blue old-school look, but kind of with a modern twist. I just thought that was the right thing to do. ... I'm not naïve to think that it's a big deal changing the look and feel, although I do think people that live here want to feel proud of their city. And this new logo can become a little bit iconic to people who live in D.C. and love basketball" ("The Mike Wise Show With Holden Kushner," WJFK-FM, 5/10).
EXPEDITED PROCESS: In DC, Michael Lee notes the process for NBA teams to "change their logos or uniforms usually takes two years, but Leonsis's desire to start anew" enabled the team to unveil the new look "in about 11 months." NBA VP/Apparel, Sporting Goods & Basketball Partnerships Christopher Arena: "Sometimes, we have some circumstances where we have new ownership, we have a vision, and we can move these timelines around a bit." The new uniforms were a "collaborative effort by the Wizards, the NBA and adidas," which "assigned a team of 11 designers" to create the look. adidas "floated several plans to the Wizards, including creating a logo centered on the Capital, but eventually settled on a tertiary logo that featured the Washington Monument pointing toward a star." They also "used the monument to form the letter 'd' in the home white uniform and the letter 'h' in the road red uniform." Wizards Exec VP/Business Operations Greg Bibb, who "worked with the league and adidas," said of the new look, "Hopefully it creates a type of connection with our fan base and gets our fans excited and energized." Lee notes the Wizards "became the latest team to go with a modern retro look," joining the Pistons, 76ers and Warriors, "who have done the same in the past decade" (WASHINGTON POST, 5/11).
WELCOME CHANGE: In DC, Tracee Hamilton writes it is "hard not to like the Wizards' new uniforms." One "modern twist" is that the "words on the jerseys are lowercase, which may be a nod to Twitter and e-mail and the slow erosion of capital letters in our online world -- or it may just look good." Hamilton notes what you "don't see in all this Bullets redux is the word 'Bullets,'" but it "would be out of character for Leonsis to disrespect Abe Pollin's wishes in such a manner" (WASHINGTON POST, 5/11). ESPN.com's Patrick Hruby wrote under the header, "Wizards' New Uniforms A Victory In War On Teal." DC is "teal-free" after the Wizards ditched their "previous gold, black and teal outfits" (ESPN.com, 5/10). ESPN’s Tony Kornheiser said red, white and blue are the “only colors a team in the capital of the United States of America should have, because our flag is not copper colored" (“PTI,” ESPN, 5/10). YAHOO SPORTS' Kelly Dwyer wrote the club is "keeping the team's name, and that weird-looking wizard in the Wizards' logo, but beyond that everything smacks of the old days" (SPORTS.YAHOO.com, 5/10). Boston Globe columnist Bob Ryan: "We love them. They harken back to the golden age of uniforms of the '60s and '70s" ("Around The Horn," ESPN, 5/10).
Dolphins CEO Mike Dee “advised all members of the organization during a meeting Tuesday that pay cuts would be immediately issued across the board until the lockout ends,” according to sources cited by Jeff Darlington of the MIAMI HERALD. Any member of the team “making more than $75,000 will face a 20 percent pay cut.” Those making “below $75,000 face a 15 percent pay cut" and anyone below $50,000 "will be hit with a 10 percent pay cut.” The sources said that “employees were told their salaries would be reinstated to their previous levels after the lockout is lifted and players return to work.” The sources added that the team during the meeting “blamed lagging season ticket sales -- basing those struggles on the lockout rather than 2010’s dismal team performance -- for the need to slash salaries.” There is “a chance the lost wages eventually will be returned to employees,” but sources “expressed doubt about such a possibility.” Dolphins Senior VP/Media Relations Harvey Greene yesterday said, “We’re a private company. We don’t comment publicly about our internal practices” (MIAMI HERALD, 5/11). In Miami, Armando Salguero reports team employees “were told the cuts affect ‘everyone,’ meaning coaches, personnel department staff and business side management are also believed affected although that was not made clear.” The cuts “affect only salaried employees but not employees making an hourly wage.” Pension plans and health insurance “were not cut.” The Dolphins “will soon have a morale problem among its employees if the first-day reaction to the news is any measure.” The team was “asked if room could be made for shortened work weeks to somehow ease the pain of what is a 10-20 percent pay cut,” but “no, was the answer on that one” (MIAMIHERALD.com, 5/11).
The Dodgers are "not on the agenda" at MLB owners' meetings in N.Y. starting today, but team Owner Frank McCourt "needs support, and fast," from other owners, according to Bill Shaikin of the L.A. TIMES. If the Dodgers cannot meet payroll later this month, reported to be a strong possibility, MLB Commissioner Bud Selig "could strip McCourt of his team with the approval of three-fourths of the owners." The owners this week are not expected to take a formal vote on McCourt's ownership of the Dodgers, but if he were to get support "from any owner besides himself, call it an upset." Still, Selig "could face hard questions on the Dodgers during this meeting." As the commissioner, Selig "works for the owners, after all," and sources indicated that he "has not sent them a memo explaining why he took over the Dodgers." A source said that McCourt is "convinced that Selig's investigation of the Dodgers will extend 'two weeks beyond him running out of money.'" Shaikin notes McCourt "will work the halls" at this week's meetings. Seven years since buying the Dodgers, he "has not developed the strong personal and collegial relationships within the game that can be so critical to surviving an ownership crisis" (L.A. TIMES, 5/11).
CAUGHT IN A RUNDOWN: Robert Sacks, an attorney for McCourt, sent a letter to MLB attorney Brad Ruskin yesterday claiming that MLB rescinded the appointment of former Pirates and Padres exec Dick Freeman to the Dodgers oversight team because Freeman "advised Jamie McCourt last year, during her divorce" from Frank. In the letter, Sacks said that Freeman "met with Dodgers personnel on Monday," and those staff members "had been told Freeman already had reviewed confidential Dodgers financial information." But MLB "denied that Freeman had access to any of the Dodgers' confidential financial information" (L.A. TIMES, 5/11). Sacks in his letter argued Freeman's appointment was more evidence that MLB's takeover of the Dodgers was "without appropriate diligence, independence or care." MLB officials yesterday said that they "were unaware of the conflict until Freeman broached the subject during a private meeting Monday" with Dodgers monitor Tom Schieffer (SPORTS.YAHOO.com, 5/10).
NAME BRAND, DISCOUNT PRICES: The Dodgers are "offering field-level seats for $30 for their game" next Monday against the Brewers, a "markdown of as much as 75% for some tickets." Because the promotion is celebrating Dodgers RF Andre Ethier's recent 30-game hitting streak, Ethier merchandise "will be discounted 30% in the stadium on the day of the game." Through 18 home games, the Dodgers are averaging 36,672 fans per game at Dodger Stadium, down 16.5% from the same point last season (L.A. TIMES, 5/11).
Thousands of "rowdy Sacramento Kings fans, many in jerseys and a few waving cowbells, turned downtown's Cesar Chavez Plaza into a sea of purple Tuesday night as they celebrated the team's decision to stay put -- for now," according to Kawahara & Bizjak of the SACRAMENTO BEE. After last night's celebration, the work to keep the team in Sacramento beyond next spring "gears up today" when Mayor Kevin Johnson and members of the David Taylor/ICON Venue Group meet with Kings Owner the Maloof family "for what are expected to be the first talks about what the owners might be willing to invest in a new arena." At yesterday's rally, Joe Maloof was "reluctant to talk about an arena plan, declaring the word 'arena' unmentionable for the day." Maloof did say ticket sales have been "terrific" since the family announced the Kings were staying in Sacramento for at least one more season. He said that "tickets are being bought at 10 times the normal rate per day," but he declined to provide exact figures. Maloof: "The last seven days we've had record days every day." He noted that the team "hired extra people to meet the demand for tickets and sponsorships that was on hold while the team's status was up in the air" (SACRAMENTO BEE, 5/11). In Sacramento, Ailene Voisin writes Joe and Gavin Maloof "seemed visibly relieved -- and even surprised -- by their overwhelmingly favorable reception" at yesterday's rally. Gavin noted that he "addressed the organization's employees the other day and received a 'standing ovation' at the end." He said, "I couldn't believe it. I think the thing is, we just want to put the past behind us" (SACBEE.com, 5/11).
In Indianapolis, Mike Wells notes Pacers President of Basketball Operations Larry Bird and GM David Morway "will remain" with the team. Bird's contract “will continue to be a handshake agreement” with team Owner Herb Simon. Bird's salary “will be less than” the $5M a year he made previously, but Simon “declined to say what that salary will be.” Simon said Bird can "stay as long as he wants." Wells notes one of Bird's “concerns was whether Simon would be willing to spend the money now that the Pacers have the opportunity to be players on the free agent/trade market for the first time since he took full control of basketball operations” in ’08 (INDIANAPOLIS STAR, 5/11).
A WORK IN PROGRESS: In Pittsburgh, Bob Smizik notes “empty seats again dominated PNC Park last night” for the Dodgers-Pirates game, “clear evidence that the Pirates flirtation with both .500 and respectable baseball might be exciting the masses in the blogosphere but it’s not doing the same for the ticket-buying public.” There were “13,493 tickets sold for the game.” Smizik: “The general public is pleased to see improvement but based on the team's long history of losing isn't ready to invest in the improvement” (POST-GAZETTE.com, 5/11).
PACK ATTACK: In Green Bay, Kareem Copeland notes the Packers “fraternized with the enemy Tuesday and will continue to do so throughout the week as part” of the sixth annual “Tailgate Tour.” Front office employees and current and former players “began a five-city tour at the Superior Dome in Marquette, Mich., as about 4,000 fans were able to ask questions, take pictures and get autographs.” Copeland notes the current NFL lockout “prohibits players from having contact with coaches and front office members,” but the rule is “set aside for charity events” (GREEN BAY PRESS-GAZETTE, 5/11).
SEA OF RED: In Portland, Geoffrey Arnold noted the MLS Timbers on Saturday for their game against the Sounders “will wear their alternate red uniforms for the first time this season.” The Timbers have “normally worn their green shirt and white shorts uniforms for away games” (OREGONLIVE.com, 5/9).
GIANT ROI? In New Jersey, John Brennan notes a review of the first wave of PSL resales on the NFL Giants’ online marketplace shows fans are “getting an average of 50 percent above the original sale price for upper-deck personal seat licenses at New Meadowlands Stadium.” The average resale price “has been $1,510 for more than 100 PSLs that originally cost $1,000 per seat.” Only 16 Giants seat licenses “out of a modest 177 sold so far in the 82,000-seat stadium have been sold at a loss, not counting fees -- half of them in the Club Mezzanine C section, where PSLs go for $7,500 and tickets are priced at $250 per game” (Bergen RECORD, 5/11).