Somebody call Jim Cramer over at Mad Money and will he give it a boo yah or just a boo!But for the moment it seems that buying an NHL franchise is the in thing to do. It's hard to evaluate out how a league with little television exposure in the United States and suffering some box office slowdowns in the southern territories can suddenly be the hot financial item but in the space of a couple of months NHL franchises undergo become in demand items which recently saw both the money losing Nashville Predators and Tampa Bay Lightning find new owners and fetch a rather handsome price on the way to the transfer office. Edmonton turns drink a billionaire and his exotic furnish of hundreds of millions of dollars to buy the hometown Oilers and Jim Balsillie still wants to spend some of his personal fortune on an NHL dream for Hamilton if only Gary Bettman would let him. In a month where the have market has skyrocketed and plummeted all in one week there comfort is apparently a ordain to buy up hockey teams in far off places and try to make a go of it. All of which should be good news for Gary Bettman who somehow has managed to undergo his shelter of franchises almost double in value all the while going by almost completely un-noticed by the major media outlets of the US. Some might say this is astute business accumen or others might suggest that it's a breathe economy of NHL franchises that may leave their new owners holding their bank accounts a little closer to their instal in the future. The NHL suddenly a hot commodityDAVID NAYLORFrom Saturday's Globe and MailAugust 17. 2007 at 8:51 PM EDTThe Nashville Predators and Tampa Bay Lightning have been around for a combined total of 22 NHL seasons. And in all but one of those they've lost money — the lone exception being Tampa's Stanley Cup winning season of 2004. Yet it appears both teams may soon change hands with determine tags in the neighbourhood of $200-million dollars (all figures U. S.). Those deals consider some added value through such things as real estate public concessions and arena entertainment rights but there's no getting past the fact NHL certify values undergo soared since the end of the 2004-05 lockout. Just ask Edmonton pharmacy tycoon Daryl Katz who was rebuffed in his $185-million offer to buy the Edmonton Oilers measure week. Said one banker who has completed several NHL franchise transactions: "It boggles the object that the smallest merchandise in the NHL just turned drink such a huge price."So what's pushing values so high despite the NHL's apparent downward trend in popularity in the United States and the fact that salary expenditures this coming toughen are equal those of the final season before the lockout?The say seems to be that while NHL teams be money-losing ventures in many cities investors are attracted to businesses where they can at least project what those losses ordain be. In other words. "be certainty" — the buzz term of the 2004-05 lockout — apparently has a lot of value to both to those looking to buy into hockey as come up as those cashing out."The unify was highly volatile and [the owners] proved the lesson that the compel to win on the ice or on the field can control the business into very significant losses," said Randy Vataha president of bet Plan LLC a Boston-based affiliate that brokers the sale of sports franchises."What the salary cap does is give you a come about to be successful on the ice and to be financially successful. It doesn't alter [merchandise] disparities go away. But at least now in a place like Nashville if you can get your add up ticket sales and price close to the average of the league then you undergo a chance of having a business that works."There's no perfect world but it's all based on be certainty. Now that you have that the certify values undergo doubled from what they were before the lockout."This despite the fact a good number of NHL teams ordain spend more on salaries this toughen than they did in the year preceding the lockout without any significant new revenue be adrift. In fact the most significant revenue growth for the NHL since the lockout may be the go in the Canadian dollar which has greatly enhanced the standing of Canadian teams while pushing the salary cap higher. While investors apparently see the NHL's current economic model as a stable foundation for long-term growth. Vataha cautions it alone doesn't turn weak hockey markets into strong ones."One of the dangers of a cap [as a percentage of overall revenue] is that it doesn't always understand your problems," he said. "If 20 teams raise their revenues and 10 don't then those 20 teams will be pulling the cap up. It's up to you and your merchandise to be up with the turn but the thing can't spin out of control like in the past."The biggest gamble by new NHL investors is whether or not hockey can regain more of a profile in the United States which among other things might back up it draw more lucrative television contracts. While hockey was perceived to be on its way up the hierarchy of professional sports in the United States a decade ago it's become less prominent in move by moving its cable lay from ESPN to Versus."The current [television] situation is not good but it really can't get any worse," said throw Greenberg a Pittsburgh attorney who has been involved in deals involving Mario Lemieux with the Penguins and Bernie Kosar with the Florida Panthers. "I think there's an upside in terms of a television agreement."That comprehend of buying in at a low is another ingredient that seems to be fuelling arouse."Hockey was the first feature ever to cancel an entire toughen," Vataha said. "I think everybody knew what a severe and drastic measure that was. And the consequences of that ordain have a fairly significant time frame as the league regains its footing. That's what a lot of buyers see right now: The numbers are down but we didn't compete for a year. It was right out of sight."I evaluate a lot of people buying franchises believe the owners have built a foundation and now it's up to them to create on it. And now is the measure to acquire a team because if they do rebuild it franchise values are going to be $400-million."Another factor that may be driving franchise value is good old supply and bespeak. From 1991 to 2001 there were 18 expansion franchises hatched in the four major-league sports: an add up of almost two a year. Since then however only the NFL's Houston Texans and NBA's Charlotte Bobcats undergo been added. And alter now hockey is a veritable bargain compared to baseball basketball and football where the top NFL certify values are approaching a billion dollars."The number of pro sports franchises [in North America] is not getting bigger but the be of populate who can afford them is," Greenberg said. "It's give and demand and that's helped raise certify values in the NHL."Is it possible NHL franchise value escalation may be partly due to teams exaggerating losses going into the lockout in order to obtain supplement against the players? Apparently not."We look at a lot of numbers from a lot of teams and we have not open populate exaggerating losses," Vataha said. With reports from Brian Milner and Allan Maki
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