All Change For NHL Owners

Hockey Digest, Nov, 2000 by David Stone

PRO SPORTS LEAGUES PREFER, all other things being equal, that team owners remain in place for years and years. Franchise stability, foremost among others, is at risk when teams change hands.

However, this summer, the NHL was busy approving the sales of a number of franchises. The trend toward change peaked when on the same late June day, the league officially authorized the transfer of the New York Islanders, Colorado Avalanche, and New Jersey Devils.

The Islanders, who have had nearly as many owners (four) as seasons (five) since 1995, now belong to Computer Associates executives Charles Wang and Sanjay Kumar. The two businessmen, who bought the Isles from former owners Howard and Edward Milstein and Steven Gluckstern, paid approximately $188 million for the franchise. The Islanders, who had the league's third-worst record last season with a paltry $16-million payroll, may become bigger players in the flee agent market, as Kumar said, "the payroll clearly is going to go up."

The Avalanche were actually sold twice over the summer. In late March, Liberty Media Corp. took over the reigns from Ascent Entertainment Group, which had previously owned both the Avalanche and the National Basketball Association's Denver Nuggets, as well as the new Pepsi Center. As soon as Liberty bought the teams and arena, it began shopping them around to other prospective buyers, as the company was really only interested in Ascent's other assets.

In April, Liberty found Start Kroenke, a part-owner of the National Football League's St. Louis Rams and a Wal-Mart heir, who beat out a group led by former Denver Bronco John Elway. Kroenke paid $450 million for the two franchises and arena. In contrast to the Avalanche, who were sold to a buyer who didn't want to own the team, the Devils were let go by an owner who immediately regretted the sale. Former owner John McMullen, who sold the franchise for $176 million to YankeeNets, the new corporation that runs both of those teams, said he felt "remorse" and was "burdened with regret" in May after agreeing to the sale.

The Coyotes were nearly on their way to Portland, as Trail Blazers owner Paul Allen was waiting in the wings to bring NHL hockey to Oregon. But NHL commissioner Gary Bettman and current owner Richard Burke, who both wanted the Coyotes to stay in Phoenix, made a deal with developer Steve Ellman, and eventually, Wayne Gretzky. Ellman agreed to pay $87 million for the franchise, for which he's building a new arena in suburban Scottsdale.

Ellman made an 11th-hour down payment to beat a May deadline that kept Allen at bay, and later put down an additional $6.5 million that gave him the option to extend the sale's closing until the end of the year. Ellman finally convinced Gretzky to join the ownership group as the May deadline approached, and the "Great One" will be the team's managing partner in charge of hockey operations. "I am a partner," Gretzky said, dispelling rumors that he will have a more hands-on role. "I'm not going to be coaching. I'm not going to be a general manager. I'm not going to be working day to day."

One of sport's most storied franchises, the Montreal Canadiens, was recently put up for sale by majority owner Molson. In spite of its great history and a new arena, the Habs have struggled with many of the economic issues that affect the five other Canadian teams. Last year. Molson announced its decision to sell the new Molson Centre, but has yet to find a buyer. However, the company will still remain closely involved with the Canadiens, as it will insist that a prospective buyer keep the team in Montreal. In addition, Molson said it will continue to sponsor the team and follow through on its 20-year, $150-million commitment.

NFL coaches recently came together to form a union-like organization in order to look out for their collective best interests. Over the summer, the NHL Coaches Association was officially formed for similar purposes. However, while NFL coaches--particularly assistants--were concerned about their job security and benefits, their NHL counterparts are focused more on marketing themselves. Aside from addressing issues such as benefits, the NHLCA will also raise money to fund a pension plan through speaking engagements, Web sites, and other opportunities. The NHL will also contribute to the pension plan through royalties paid by the coaches association for the use of the NHL trademark.