Cynamon/Sokolowski and Coyotes?

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Oct 292009

Back in the summer the NHL presented the names of Toronto Argonaut co-owners Howard Sokolowski and David Cynamon as an interested group in purchasing the Phoenix Coyotes. Later it was rumoured that these two potentially joined up with the Ice Edge Holdings Inc. group which would purchase the Coyotes. Today we hear that the two Argonaut owners have decided to go on their own again and have broken away from the Ice Edge group.

Sokolowski and Cynamon had been linked to Ice Edge Holdings, a group of eight Canadian and U.S. businessmen who have made a pitch for the club. But their involvement with Ice Edge ended several weeks ago, according to sources familiar with the bidding.

Just to give a little background on Sokolowski and Cynamon, these two purchased the Toronto Argonauts when the Argos were in financial/bankruptcy trouble of their own. They had some early success on the field which turned the franchise around financially but the past couple seasons have been a disaster on the field and attendance and the image of the team within Toronto has been hurt because of it. But overall the franchise is doing OK, but we have recently heard that they may be looking to sell the team and get involved in the NHL.

We also heard this summer that when Sokolowski and Cynamon purchased the team for a mere $2 million, the owner of the BC Lions put up half of the franchise fee and has continued to lend money to the franchise since the purchase in 2003. None of these transactions were approved by the CFL nor did the CFL even have knowledge of these transactions. The CFL has issued a statement that the transactions that took place only took place because of the love of the game by the people involved and that there is no evidence that the integrity of the league has been affected in any way. That is all fine and dandy, but that raises several questions with respect to the suitability of these two as owners of an NHL franchise.

1. Can Sokolowski and Cynamon actually afford an NHL franchise? If they only put up half of a $2 million fee and then required additional loans to fund ongoing operating losses, can they really afford a $140 million price tag on the Coyotes along with whatever losses the franchise will suffer over the next few seasons?

2. If the NHL rejected Jim Balsillie for his questionable negotiation tactics during the negotiations to purchase the Penguins and Predators, can they just brush aside the fact that they, without CFL permission and presumable against CFL regulations, accepted funding from a fellow CFL owner?

As for question 1, I honestly don’t know how wealthy Sokolowski and Cynamon are or what kind of investors that they may have backing them but based on the CFL example I have my doubts that they themselves have the financial ability to put up $140 million and then fund the teams losses for the next several years. But of course, not having financial wherewithal has never stopped the NHL from approving an owner. See Len Barrie and the Tampa Bay Lightning as a prime example.

As for question 2, the answer should be no, the NHL should not just ignore that fact and it should be held against them just as Balsillie’s negotiation tactics were held against him. Nothing Balsillie did could have harmed the integrity of the on ice product, which in my opinion is the most important thing to preserve, while having an owner having a financial interest in two franchises at least opens the door to possibility of integrity issues, or at least the appearance of a possibility of integrity issues. I consider the Cynamon/Sokolowski team funding issues to be of greater significance than the Balsillie negotiation tactics issues but of course the NHL does not agree as evidenced by the fact that there was no backlash against current Minnesota Wild owner Craig Liepold for lending money to Boots Del Biagio (who we now know had no money) to allow him to become a minority owner of a group purchasing the Nashville Predators from then owner of the Predators, Craig Liepold.

It seems to me that all you really need to be an NHL owner is Gary Bettman’s blessing and play by Gary Bettman’s rules. In that regard, Sokolowski and Cynamon may be perfectly qualified to be NHL owners. But of course, I don’t believe that anyone purchasing the Coyotes really believes the Coyotes have a future in Phoenix but rather they just see it as a cheap way to get into the NHL and eventually move the team to a location where they want. With that in mind, I expect Sokolowski and Cynamon, and their financial backers, are really a group that wants to put a second team in the Toronto area and so long as they don’t tell Gary Bettman that or make it publicly known, it may work out for them.

Oct 282009

The NHL has never backed away from talking itself up and it recently issued a press release that did just that. Much of the press release highlighted the increase in television ratings and increased traffic to but there was some discussion on NHL attendance levels.

-Through Oct. 21, attendance increased or remained even for 18 NHL teams compared to the same number of home games last season.

-Teams with the largest gains in attendance included the Boston Bruins, Atlanta Thrashers, Washington Capitals, New Jersey Devils, Florida Panthers and Columbus Blue Jackets.

It is interesting that they point out that attendance for 18 NHL teams have remained the same or increased because that implies that attendance has dropped for 12 NHL teams, which can’t be a good thing. It should be noted that nowhere in that press release did it discuss overall attendance levels which are actually down.

I have dug through all the NHL game data and compared this seasons home attendance to last seasons home attendance for every team comparing attendance for each teams first x number of home games this year to that teams first x number of home games from one year ago where x is the number of home games the team has played so far this season. Games played in Europe last year and this year have been omitted. Here are the results for games played through last night.

Atlanta had the greatest attendance increase attracting an average of 1,634 additional fans per game but it should be mentioned that they have only played 3 home games so far so the sample size is quite small and is likely influenced by the fact that two of their home games this year were Saturday games while none were last year and teams generally draw much better for Saturday games.

New Jersey is second attracting an additional 1,469 additional fans, but again, of their 4 games so far, two have been Saturday games and none were a year ago. Next at the top of the increased attendance list are Boston, Columbus and Washington who have benefited from have pretty good seasons on the ice last year. All other teams with an increase in attendance saw an increase of less than 1% while Calgary, Edmonton, Montreal and the Rangers had exactly the same attendance and sold out every game. Vancouver also sold out every game last year and again this year but somehow managed to find an additional 180 seats per game to sell.

Teams with the greatest drop in attendance are Phoenix (-30.4%), Anaheim (-10.9%), Islanders (-9.6%), Colorado (-8.9%), Carolina (-8.1%), Tampa (-5.0%), Nashville (-5.0%), Ottawa (-4.8%), Detroit (-3.1%), Dallas (-3.1%), Minnesota (-2.0%), Chicago (-1.1%), and Buffalo (-0.7%).

Overall attendance compared to last season has dropped 45,988 or about 307 fans per game which equates to a drop of approximately 1.8%. If these trends continue the NHL could see upwards of 350,000 fewer fans purchasing tickets this season. To put that into perspective, if each ticket sale lost was a $50 ticket, that would equal a drop in revenues of 17.5 million in ticket sale revenue which in the grand scheme of things is not that significant. That much revenue loss would equate to a salary cap drop of approximately $330,000, though a drop attendance would also affect other game day related revenues (parking, concessions, merchandise, etc.).

But what the NHL has to find disturbing is that the drop in attendance is mostly affecting the already financially challenged teams like Phoenix, Islanders, Carolina, Tampa, Nashville, etc. These teams cannot afford to become any less competitive with the big markets and additionally some teams like Phoenix and Nashville are facing the potential to see their revenue sharing dollars cut if they can’t get above 14,000 in attendance or can’t grow revenue at the same pace as the rest of the NHL.

Here is each teams attendance change from one year ago.
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Oct 272009

Yesterday the NHL, Moyes, and the other creditors were in court before bankruptcy judge Redfield T. Baum and they have apparently come to an arrangement that will see the NHL purchase the Coyotes.  The intention of the NHL is to secure the Coyotes and then quickly flip them to another potential owner interested in keeping the team in Phoenix.  The most talked about potential buyer is a group called Ice Edge Holdings which had previously expressed interest in purchasing the team but was not able to come to an agreement with the City of Glendale and possibly other creditors in time to put in a bid during the bankruptcy process. conducted an interview with Daryl Jones of Ice Edge in regards to the situation.  Two things he said deserve some consideration.

Any new buyer is going to need some help, and I don’t mean concessions. You need help from the NHL to draw fans, and Glendale on a grassroots level.

Interesting that he said “I don’t mean concessions” which I read to mean concessions from the city. I don’t buy this. I believe this is a publicity statement because everyone agrees that the Coyotes cannot operate under the current lease arrangement and the NHL is purchasing the Coyotes only committing to keep the current lease through the end of this season. Essentially the existing lease agreement is going to be torn up at the end of this season and anyone purchasing the Coyotes with the intent of keeping them in Glendale will only do so with a different lease arrangement. Ice Edge, or any other ownership group, will have the ultimate bargaining power with the City: let us play here for next to nothing, or we will leave. Daryl Jones can call it something other than ‘concessions’ but the only way the team stays in Glendale is under a new, and much cheaper, lease arrangement that will see less net flow of money from the team to Glendale.

No we’re not going to do that. I know other parties have tried to do that. We quite frankly don’t have a backup plan. Our plan is to make it work in Phoenix. In our opinion, it’s the wrong way to approach the partnership with Glendale – a “we’ll try it but if it doesn’t work out we’re going to leave.

That statement is just plain stupid. No one, and I mean no one, will be willing to put $140 million into a relatively risky investment without a backup plan. They may not state it publicly but I can guarantee you they have discussed a backup plan. The guys behind Ice Edge Holdings Inc. are investors looking to make a profit, not mega rich guys looking for a hobby to spend their money on. They view this as a way to get into the NHL on the cheap. If an NHL franchise in say Kansas City is worth $200 million and they purchase the Coyotes for $140 million, that gives them a $60 million cushion to work with. If they can get a much better lease arrangement with the City of Glendale and get some additional revenue from playing a handful of games in Saskatoon they could theoretically test the Coyotes market for say 3 years before they eat up that $60 million. From an investment standpoint, they don’t start losing money until they go beyond the $200 million point. If anyone thinks that Ice Edge Holdings hasn’t discussed this you are fooling yourself. Even the NHL didn’t want to buy the team without an out clause in their conditions to purchase the team.

There is also some talk that Gary Bettman is continuing discussions with a Toronto group that is interested in purchasing the Coyotes and keeping them in Phoenix. Again, my skepticism remains the same. I just can’t imagine anyone without any specific ties to the Phoenix area being willing to purchase the Coyotes and be committed to keeping the team in Phoenix long term. No one will put that much money at risk without at least some assurances that if it doesn’t work out in a few years they can move the franchise. Publicly they may state otherwise, but most assuredly they will be looking at an out.

Since we are on the topic of the Phoenix Coyotes, Gary Bettman conducted and interview on Coyotes TV in which he said something completely ridiculous in regards to the Coyotes franchise.

The vital signs with everything that this franchise has been through are actually pretty good.

Here is the reality of it all. They held an opening night promotion selling all tickets at $25 or less and they managed to sell out the arena. Since then they have average just under 9,000 tickets sold per game (with fewer fans bothering to show up). Barring a completely unexpected change of fan interest the Coyotes will not reach an average of 14,000 fans per game which will see their revenue share allotment cut back by 25%, or nearly $4 million and if they don’t reach that level again next year it will be cut back even more. That makes a dire situation look even worse. Now, I am not sure of Bettman’s definition of ‘pretty good’ is, but I would not call those pretty good vital signs.

Oct 162009

So the word out of Phoenix last night was that the announced attendance for the Coyotes game was 6,899 but that probably more like 5000 people actually showed up. Clearly attendance in Phoenix is going to be a major issue this year, but it won’t just be Phoenix if early attendance numbers are any indication. Here are attendance numbers for three other southern U.S. teams that have played at least 3 home games so far.

Carolina Hurricanes

2008-09 2009-10 Difference
18680 18680 0
18680 16186 -2494
15016 13597 -1419
15635 14053 -1582

Nashville Predators

2008-09 2009-10 Difference
17113 14797 -2316
13259 14209 950
12042 12179 137
14704 13103 -1601

Tampa Bay Lightning

2008-09 2009-10 Difference
18552 17454 -1098
14420 14212 -208
15191 14126 -1065

It is still early but those are significant drops in attendance figures. Nashville is going to be particularly interesting to watch because they need to keep attendance above the 14,000 mark to maintain a full share of revenue sharing. Failure to achieve an average of 14,000 will cause them to lose 25% of their revenue sharing allotment which would equate to close to $4,000,000 which is significant to any team, particularly one that is struggling to break even. If Tampa struggles on the ice and fans become more disinterested because of it this could become a problem for them as well and we already know how unstable their ownership situation is. This despite a significant drop in average ticket price for Lightning games.

What is also interesting is that falling attendance may not be limited to non-traditional southern US hockey markets.

Ottawa Senators

2008-09 2009-10 Difference
20182 18075 -2107
20179 19360 -819
19318 17014 -2304
18952 17732 -1220

The rise in the Canadian dollar will help offset some of the drop in attendance revenue and if Ottawa can play well then I can see their attendance improving, but clearly some of the luster of high flying Senators teams of a few years ago when they sold out every game has faded away.

Detroit Red Wings

2008-09 2009-10 Difference
20066 20066 0
19011 19122 111
20066 17782 -2284

We all know that Detroit is an extremely hard hit city economically and it may start reflecting in the Red Wings attendance this year. The 17,782 that showed up to watch the Red Wings last night is 1,080 fewer fans that last years lowest attendance level of 18,862.

I revisit these teams and also take a look at a few other franchises (Atlanta, Florida, Dallas, etc.) in a few weeks once each team has played a few more home games but early indications are not all that good for some franchises.

Oct 122009

Last week I wrote on the worst team money can buy and in honour of Canadian Thanksgiving I figured I would write up a similar article this time discussing all the players we can be thankful are on our team because they provide good value for their salary.

The NHL salary floor is $40.8 million so in making up this roster I intend to get as close to that floor as possible, and certainly within $1 million of it. The other restriction I am putting on myself is to not select any players on entry level contracts. Everyone else is fair game though. Here is what I have come up with:

LW: Zach Parise, $3,125,000
C: Ryan Getzlaf, $5,325,000
RW: Daniel Alfredsson, $4,875,000

LW: Brooks Laich, $2,066,666
C: Brandon Dubinsky, $1,850,000
RW: Teemu Selanne, $2,625,000

LW: Rene Bourque, $1,350,000
C: Ryan Kesler, $1,750,000
RW: Alexandre Burrows, $2,000,000

LW: Shawn Thornton, $516,666
C: Manny Malholtra, $700,000
RW: Tyler Kennedy, $725,000

D: Niklas Kronwall, $3,000,000
D: Ryan Suter, $3,500,000
D: Mark Stuart, $1,300,000
D: Braydon Coburn, $1,300,000
D: Ian White, $850,000
D: Jay McKee, $800,000

G: Cam Ward, $2,666,666
G: Josh Harding, $1,100,000

Total: $41,424,998

Most of the players on the list above are on their second contracts after their entry level contract and signed before they became unrestricted free agents or older players who have taken home town discounts (Alfredsson, Selanne) or players who were forced to sign cheap because of lack of money to go around (Malholtra, McKee).

That lineup is quite strong down the middle (Getzlaf, Dubinsky, Kesler, Malholtra) with some solid wingers and a healthy dose of physical play spread throughout. There really aren’t many, if any, teams with a forward group as good as the above group and the top line of Parise-Getzlaf-Alfredsson would be among the top in the game. The defense is a little thinner as I allocated more money to the forwards but Kronwall-Suter make for a pretty good top pairing and Stuart-Coburn make a good young second pairing. Jay McKee can be a PK specialist who will block a lot of shots and White can do a number of things well and is capable of eating up ice time at a relatively cheap price. The defense is good but certainly not Detroit good or Anaheim from a couple years ago good. In goal you have a quality goalie in Cam Ward (who will not be on this list next year with is sizeable pay increase) who has won a Stanley Cup and a very very good backup in Harding who has starter potential down the road.

Overall, I think this team could compete with any team in the NHL today and might in fact be the Stanley Cup favourite.

Oct 092009

While reading Greg Wyshynski’s article on, it got me thinking, what are the most over paid players in the NHL? I later refined that question to be, what is the worst team money can buy? By that I mean, if one built a team out using current players and their salary cap hits, what is the worst team I could come up with if I spent to the salary cap of $56.8 million?

The guidelines I went with were that I needed 12 forwards, 6 defensemen and 2 goalies with at least some resemblance of four left wingers, four right wingers and four centers though there are many forwards that play multiple forward positions (especially either wing) so there is some leeway here. Furthermore, I didn’t take players that were not on active NHL rosters (i.e. Michael Nylander) and I only took players with a salary greater than $1,000,000 believing that anyone making close to the league minimum is probably a reasonable value even if they aren’t that great or could be easily replaced with a decent enough player. I also had to have the total team salary above $56 million but below the cap of $56.8 million. So, with those guidelines in mind, this is what I came up with:

LW: Dustin Penner, 4,500,000
C: Chris Drury, 7,050,000
RW: Fredrik Modin, 3,250,000

LW: Jonathan Cheechoo, 3,000,000
C: Jeff Halpern, 2,000,000
RW: Radim Vrbata, 3,000,000

LW: Darcy Tucker, 2,250,000
C: Brendan Morrison, 1,500,000
RW: Colton Orr, 1,000,000

LW: Jamal Mayers, 1,333,333
C: Chris Kelly, 2,125, 000
RW: George Laraque, 1,500,000

D: Wade Redden, 6,500,000
D: Ruslan Salei, 3,025,000
D: Tom Preissing, 2,750,000
D: John Erskine, 1,250,000
D: Sean O’Donnell, 1,250,000
D: Darryl Sydor, 1,000,000

G: Jose Theodore, 4,500,000
G: Vesa Toskala, 4,000,000

Total Salary: $56,783,333

There are some decent players on that list. When forced to spend to $57.8 million you really can’t avoid not taking some decent players. The team is fairly defensively minded at center ice and has several physical/tough guy players but I think goal scoring is going to be a problem. On defense there isn’t really much of anything mostly consisting of older players past their prime or a guy like Redden who for some reason has forgotten how to play quality hockey over the past couple seasons. At $2.53 million he might be decent value, at $6.5 million he is horrible value. In goal we have a former great starter who like Redden seemingly has forgotten how to play decent hockey and a once decent backup who has yet to show he can be a decent starter.

Three players that almost made the list were Lee Stempniak (2,500,000), Chris Neil (2,000,000) and Cristobal Huet (5,625,000) but I ended up going with Penner, Orr and Theodore instead because for $2 million more I don’t think you are going to get much more offense from Penner and I believe that Huet still has greater upside than Theodore though I’ll admit with a higher salary may not be greater value. I think Neil is significantly over paid at $2 million but I had to take Orr at $1,000,000 instead because Neil would put me over the cap.

So, what do you think? What would be your worst team money can buy?

Oct 012009

Here are my eastern conference predictions:

1. Washington, 109pts – This is a bit of a gamble that the Capitals are going to get good enough goaltending from Theodore and Varlamov, but if they do, 109 points is easily within their reach. They had the pure offensive stars last season and I think that the singing of veteren and more physical winger Knuble will be one of the best free agents signings of this past summer.

2. Philadelphia, 104pts – They lost a bit of scoring up front with Knuble signing in Washington and Lupul traded to Anaheim but a healthy Briere and the progression of youngsters Claude Giroux and James van Riemsdyk and Pronger gives them a true stud on defense. Like Washington they are going to need better than average goaltending to obtain these lofty point totals but if they get it reaching 104pts shouldn’t be a problem.

3. Pittsburgh, 99pts (fourth seed) – They won the Stanley Cup and they are a great team, but even as a great team they have been streaky from time to time over the past couple seasons and that will probably continue and will stop them from reaching 100+ points. But they will still be a tough team to beat come playoff time.

4. Boston, 98pts (third seed) – The Bruins are going to drop off a fair bit from last season simply because I don’t really think they are really as good as they performed last year. A lot of things went really well for them and not many didn’t, plus they lost Phil Kessel and that will hurt their depth a little. But they are still a good team with Thomas in goal, Chara on defense and several very good forwards.

5. New Jersey, 97pts – New Jersey is no longer the elite team it one was largely due to a far more average defense group than they have in the past, but with some solid offensive players combined with a good team defensive system and elite level goaltending they will once again be middle of the pack of eastern conference playoff teams, right there between great and mediocre.

6. Toronto, 95pts – Now I know a lot of people will scream bias at this prediction but I truly believe that 95 points is relatively easily obtainable if they even get average goaltending. Maybe I shouldn’t assume that but with a healthy Toskala, a promising prospect in Gustavsson and a more than decent third option in Joey MacDonald not to mention one of the best goalie coaches in the game in Francois Allaire getting average goaltending is certainly within reach. They also have a good and deep defense and a significant number of forwards capable of scoring 20-30 goals so they should produce enough offensively. Goaltending is key.

7. NY Rangers, 93pts – The Rangers desperately need Gaborik to remain healthy if they want to make the playoffs. Furthermore, they could definitely use another experienced defenseman or two and I expect we’ll see them address that at some point. They have elite level goaltending and that should be good enough to get them in the playoffs so long as Gaborik can be mostly healthy.

8. Buffalo, 92pts – One could easily argue that if Ryan Miller didn’t get injured and miss several weeks last year they the Sabres would have made the playoffs. The reality is there is enough talent on this team that they could finish as high as 5th in the conference if not challenge Boston for the team lead. I am just not sure their defense is good enough right now so I’ll say they will finish in 8th spot.
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Oct 012009

Here are my western conference predictions. Eastern conference predictions to come later this afternoon.

1. San Jose, 113pts – They have lost some depth but added a big time scorer in Dany Heatley. I am not sure if they will be a better team, or most importantly for San Jose fans, a better team in the playoffs, but they are still good. They need aging Rob Blake to have another good year in him though and youngsters Setoguchi and Clowe to repeat or improve on last year.

2. Chicago, 107pts – Detroit’s loss is Chicago’s gain with the addition of Marian Hossa although he will miss the early part of the season, possibly up to a couple of months. But the remainder of the young Chicago players will take another step forward which should be enough for them to take the central division. The big question mark is in goal which could hurt their chances to be a 100+ point game.

3. Vancouver, 104pts
– Vancouver may not have the offensive flair of the Sharks and Blackhawks or a few of the eastern conference teams but they have a very well balanced team with an elite goalie, a solid and deep defense and a well rounded group of forwards. It is hard to pinpoint any significant flaws except that as a group they don’t have a history of success, particularly in the playoffs. They are a very good team though.

4. Detroit, 103pts – With the loss of several significant players – Hossa, Hudler, Samuelsson, etc. – the Red Wings will almost certainly take a bit of a step back this season, at least until some of the new players adapt to their new roles. That said, their defense is still second to none and they still have a number of top level forwards so they will still be a team to contend with.

5. Anaheim, 98pts – I have Anaheim higher than maybe most people do but I believe they are an elite level team and it wouldn’t surprise me if they were even better than I am predicting. Few teams can boast the quality of forwards that the Ducks have with a top six of Getzlaf, Perry, Ryan, Lupul, Selanne and Koivu. Their defense isn’t as strong as in the past with the loss of Pronger but it isn’t bad and they are certain to have quality goaltending with either Giguere or Hiller.

6. Calgary, 95pts – I am not as optimistic on the Flames as many are. Sure they added Bouwmeester which will give them a very good defense, but the loss of 39 goal scorer Cammalleri will hurt the offense in a significant way. But making matters worse is Kiprusoff’s steady decline from elite level goalie to just a good one, at best. His save percentage has dropped steadily (.933, .923, .917, .906, .903) an his goals against average has risen steadily (1.70, 2.07, 2.46, 2.69, 2.84). Those are not good trends and unless he can reverse them I don’t see Calgary being much of a threat this season.

7. Minnesota, 93pts – This year is a bit of a transition year as the Wild will move to be a bit less of a defense first team and I think they have the players that will work well in that system. They are a playoff bubble team, but I think they will get in.

8. St. Louis, 91pts – Last year was a break through year for the Blues and they went from one of the worst teams in the league to a playoff team. I am not sure their young players are quite ready to take the Blues from borderline playoff team to a contender but they should remain in the playoff hunt again. Goaltending and the play of Erik Johnson are keys to the Blues success.
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