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The NHL Shift: News and notes, 4/25/2014
April 25, 2014 09:35 AM
The New York Islanders this week released an offering memorandum for majority ownership to potential bidders for the team, according to a source in the finance industry.
In the memo, Islanders owner Charles Wang offers 75 percent ownership of the club, with a five-year option on the other 25 percent. The memo also states that the Islanders sustained an operating loss during the 2013-14 season of $4.8 million, with the loss minimized greatly by $15 million received from NHL revenue sharing and escrow payments.
According to the memo, total revenue for the Islanders in the just-completed season was $84 million. That included $22 million in ticket revenue. The Islanders played 40 home games at Nassau Veterans Memorial Coliseum and one game (as part of the NHL’s Coors Light Stadium Series) as the home team at Yankee Stadium against the New York Rangers.
The value placed on the team in the memo: $370 million.
The memorandum was released by the team on behalf of Wang, who has yet to utilize the services of a bank or financial consultants in the ongoing sales talks. Wang’s finances are handled by Islanders alternate governor Arthur McCarthy, who has been an executive with the club since 1985. McCarthy is the chief financial officer of technology company NeuLion, for which Wang is chairman of the board.
On Wednesday, NHL Commissioner Gary Bettman confirmed what has been reported in this space over the last two weeks: Although Wang is soliciting and listening to offers for the Islanders, he may not be ready to say goodbye to the team.
Wang acquired the Islanders in 2000.
“Charles hasn’t decided whether or not he’s definitely going to sell,” Bettman said on WFAN-AM/New York on Wednesday. “He’s very attached to the Islanders. I don’t think there’s any doubt about that. He’s looking forward to the move to Barclays.”
The Islanders begin play at the Barclays Center in Brooklyn in the 2015-16 season.
In earlier discussions with prospective buyers, before the offering memorandum was released, Wang was offering between 30 percent and 49 percent of the team at the start, with Wang remaining the Islanders’ majority owner for at least the next two seasons.
Philadelphia hedge fund manager Andrew Barroway is the lone suitor whose name has been made public. A league source said a finalized deal between Barroway and Wang “is not close,” and that Barroway “does not have a leg up on anyone else interested in buying the Islanders.” Barroway has been in search of partners to help him fund the purchase.
As reported in The Shift last Friday, there are at least two additional suitors for the Islanders, besides Barroway. Strike one name from that list, though: Brooklyn-born billionaire Nelson Peltz.
Peltz, CEO of asset management firm Trian Partners, has been linked to bids for the New Jersey Devils and Ottawa Senators in the past, and the 71-year-old Peltz is a hockey advocate: He once described after-school life for his children as “gym, ice and homework,” and he has a rink inside his Bedford, N.Y., home. His son, Brad, also was drafted by the Ottawa Senators in the seventh round of the 2009 NHL draft.
However, a source close to Peltz told The Shift on Thursday that he has “no interest” in bidding for the Islanders.
BY THE NUMBERS
More than $3 million(CAN): Gross revenue, according to an NHL source, for each of two first-round playoff home games of the Montreal Canadiens, who swept the Lightning in four games. That figure will be even higher in the second round, with higher ticket prices.
3.8 million viewers: The average combined TV audience in Canada for each of the four games of the Canadiens-Lightning series. The games averaged 2.3 million viewers on CBC and 1.5 million viewers on RDS.
31 of 31: Sold-out first-round playoff games, through Thursday night.
$378: The most-expensive ticket available on the secondary market for an NHL playoff game this weekend, for Game 5 of the Rangers-Flyers series at Madison Square Garden on Sunday afternoon, according to ticket price aggregator TiqIQ.
$148: The least-expensive ticket available, for Game 5 of the Ducks-Stars series at the Honda Center tonight.
500,000: The number of entries submitted by fans on NHL.com for the Stanley Cup Playoffs Bracket Challenge powered by Can-Am. The grand prize is a choice of a 2014 Can-Am Spyder RS or $15,000. Among those submitting brackets were celebrity hockey fans Jon Hamm, Alyssa Milano, Martina McBride, Pat Sajak and Boomer Esiason.
205: Consecutive home games sold out by the San Jose Sharks, through Game 2 of their first-round playoff matchup with the Kings. In last Friday’s post, we listed seven NHL teams with sellout streaks of more than 100 combined regular-season and playoff games. Turns out, there is an eighth: San Jose. We apologize to the Sharks.