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Devils Financial Woes on Verge of Being Solved?


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#1 njdevil26

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Posted 08 June 2012 - 08:52 AM

Posted on HFboards..

https://www.sportsbu.../08/devils.aspx

Can't see the whole article though... discuss?
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#2 njdevil26

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Posted 08 June 2012 - 08:59 AM

The Devils apparently have found a solution to regaining their financial footing. According to a source close to the situation, Devils Owner Jeffrey Vanderbeek has finalized a deal with a new investor that will enable the franchise to get out of debt. The source said the deal would keep Vanderbeek firmly in charge as the majority owner, while minority owners Ray Chambers and his son-in-law, Mike Gilfillan – who owned a substantial stake in the Devils through their company, Brick City – are not expected to have future roles in the organization.

The identity of the partner has yet to be announced because, according to the source, there has been an agreement to stay silent until the completion of the Devils’ season. A formal announcement of the deal is expected within two weeks of the conclusion of the Stanley Cup Final.
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#3 Jerzey Devil

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Posted 08 June 2012 - 09:02 AM

All we can do is hope it's true this time.
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#4 sundstrom

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Posted 08 June 2012 - 09:03 AM

It's Zach Parise. He saw how well it worked out for Mario.
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"This team was never the same once we lost Patrik Sundstrom"- Lou Lamoriello


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“They’re the ones that makes it happen,” Lemaire said. “It’s not us. It’s not me. It’s not the other guy. It’s not the guy before. It’s not the guy after. It’s them. And they have to take care of business.”
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"I guess I just miss my friend" (#28)


#5 maxpower

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Posted 08 June 2012 - 09:10 AM

Doesn't make alot of sense. Especially the part about JVB keeping majority, it would be a tad odd for 1 person to spend so much money on essentially nothing, when you can buy the whole thing out of bankruptcy.
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#6 lazer

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Posted 08 June 2012 - 09:16 AM

donald trump...would be my guess.
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#7 Daniel

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Posted 08 June 2012 - 09:24 AM

Doesn't make alot of sense. Especially the part about JVB keeping majority, it would be a tad odd for 1 person to spend so much money on essentially nothing, when you can buy the whole thing out of bankruptcy.


While it's probably the case with most other types of businesses, bankruptcy gets even more complicated than it already is when you're dealing with a professional sports franchise. A rich guy can't just come along and say, I'll buy a majority stake in the team.

On the other hand, the word is the rest of the majority of the owners and the league does not like VBK, and I don't see why the league would do him any favors. Perhaps to avoid the embarrassment of having a Stanley Cup finalist declare bankruptcy a day after the season is over.

donald trump...would be my guess.


God help us if that's remotely true.
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#8 Chuck the Duck

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Posted 08 June 2012 - 09:24 AM

Doesn't make alot of sense. Especially the part about JVB keeping majority, it would be a tad odd for 1 person to spend so much money on essentially nothing, when you can buy the whole thing out of bankruptcy.


True. But nobody knows whether the new investor is also getting a stake in Devils Arena Entertainment, the seperate corporate entity that runs (and takes its profits from) the arena. The stories always say that Chambers wants to get out of his minority interest in the team, but it never says anything about the DAE deal which, in the long term, could potentially be the more lucrative attraction to investors.
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#9 maxpower

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Posted 08 June 2012 - 09:29 AM

True. But nobody knows whether the new investor is also getting a stake in Devils Arena Entertainment, the seperate corporate entity that runs (and takes its profits from) the arena. The stories always say that Chambers wants to get out of his minority interest in the team, but it never says anything about the DAE deal which, in the long term, could potentially be the more lucrative attraction to investors.


DAE is up to its eyeballs in debt too. That's the catch. I'm guessing the value of the whole gigantic ball of debt is probably around $350-400M or so?

The team's debt and the arena's debt are two different things. The team's debt is old losses and the service on it which is problemsome now. The arena debt is the bomb that goes off in a couple of years.

Edited by maxpower, 08 June 2012 - 09:29 AM.

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#10 lazer

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Posted 08 June 2012 - 09:31 AM

God help us if that's remotely true.

just a bad guess but i wanted to see what it looked like on the internet. :evil:
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#11 sundstrom

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Posted 08 June 2012 - 09:32 AM

team debt is $80MM. Arena debt is $180MM. That was the report last summer.

i could believe that for JVB to get someone that allowed him to remain in control while clearing the debt (not just refinancing it), was giving him an Einhorn-Mets like deal where they paid the debt and JVB had time to make good to them or they got the team cheap.
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"This team was never the same once we lost Patrik Sundstrom"- Lou Lamoriello


20082719943.png
_________________________________________________________________
“They’re the ones that makes it happen,” Lemaire said. “It’s not us. It’s not me. It’s not the other guy. It’s not the guy before. It’s not the guy after. It’s them. And they have to take care of business.”
-
"I guess I just miss my friend" (#28)


#12 maxpower

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Posted 08 June 2012 - 09:35 AM

team debt is $80MM. Arena debt is $180MM. That was the report last summer.

i could believe that for JVB to get someone that allowed him to remain in control while clearing the debt (not just refinancing it), was giving him an Einhorn-Mets like deal where they paid the debt and JVB had time to make good to them or they got the team cheap.


The bust-out scenario, I'm just not sure what they get out of that because you have to assume the arena debt too, otherwise you're just an owner of a break-even hockey team with an arena lease with JVB. Yuck.
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#13 Triumph

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Posted 08 June 2012 - 09:38 AM

SBJ is a reputable source. DAE might be heavily in debt but it has to be making gobs of money on all the Newark dates, no?
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#14 maxpower

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Posted 08 June 2012 - 09:41 AM

SBJ is a reputable source. DAE might be heavily in debt but it has to be making gobs of money on all the Newark dates, no?


While the Garden is shut down, sure. They do have that lease where they sodomize Newark, and I guess they could be cooking the books moving money from hockey operations (concessions and such) into DAE business.

It just seems like a real sh!tty deal on paper. If JVB got nuked, it would be a good deal. sh!t, no one knows if he even has kick-in money in the first place. LOL. He didn't pay the bills this year and still had to get a bridge loan from the league.
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#15 Chuck the Duck

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Posted 08 June 2012 - 09:43 AM

DAE has to be making a profit year over year. They derive 100% of the revenue from the building while, effectively, paying $0 in rent due to the recent arbitration ruling. You can't get a much better deal than that.
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#16 Triumph

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Posted 08 June 2012 - 09:48 AM

DAE has to be making a profit year over year. They derive 100% of the revenue from the building while, effectively, paying $0 in rent due to the recent arbitration ruling. You can't get a much better deal than that.


Right. So once the debt is paid, that end of the business is a license to print money.
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#17 sundstrom

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Posted 08 June 2012 - 09:50 AM

The bust-out scenario, I'm just not sure what they get out of that because you have to assume the arena debt too, otherwise you're just an owner of a break-even hockey team with an arena lease with JVB. Yuck.


because the big debt is DAE on the arena and that's not necessarily the new owner's problem.

assuming you JUST get the team, and you get it on a ridiculously sweetheart deal assuming JVB can't repay you in an allotted time frame, you'll own the NJ Devils for perhaps $100MM all in. That for a team that has revenues of probably $70MM outside of concessions at the arena with what amounts to free rent is not bad.

edit: back of the napkin calcs have me thinking that strict revenue outside of concessions might actually be closer to $80 or $90MM. The team is what gets the TV money and merchandising money and shared league revenues.

Edited by sundstrom, 08 June 2012 - 09:53 AM.

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"This team was never the same once we lost Patrik Sundstrom"- Lou Lamoriello


20082719943.png
_________________________________________________________________
“They’re the ones that makes it happen,” Lemaire said. “It’s not us. It’s not me. It’s not the other guy. It’s not the guy before. It’s not the guy after. It’s them. And they have to take care of business.”
-
"I guess I just miss my friend" (#28)


#18 sundstrom

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Posted 08 June 2012 - 09:55 AM

DAE has to be making a profit year over year. They derive 100% of the revenue from the building while, effectively, paying $0 in rent due to the recent arbitration ruling. You can't get a much better deal than that.


i am not convinced that DAE gets 100% of the building revenue either. its possible that the devils themselves are written into concession deals on dates where they play. it would make sense that they would be to pump the value of the franchise.
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"This team was never the same once we lost Patrik Sundstrom"- Lou Lamoriello


20082719943.png
_________________________________________________________________
“They’re the ones that makes it happen,” Lemaire said. “It’s not us. It’s not me. It’s not the other guy. It’s not the guy before. It’s not the guy after. It’s them. And they have to take care of business.”
-
"I guess I just miss my friend" (#28)


#19 aylbert

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Posted 08 June 2012 - 09:56 AM

I bought the share. It's going to be sweet. #OrNot
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#20 DevsMan84

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Posted 08 June 2012 - 10:00 AM

Well this certainly is good news at least at face value. I can't wait to hear the specifics and to who it is.
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