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Report: Atlanta Thrashers could be sold for $110 million

May 2, 2011, 4:52 PM EDT


If a report is accurate, an ownership group might be able to acquire the Atlanta Thrashers for as little as $110 million. Obviously, that’s still a lot of money, but Forbes’ Mike Ozanian explains that there might be a few million reasons why the deal could be a decent gamble.

The No. 1 reason is that the NBA’s Atlanta Hawks are responsible for the arena’s bond payments, meaning the Thrashers just play a flat rent. If that doesn’t make sense to you, the simpler way to look at it is that the team could net about $7 million in non-ticket revenue because the Hawks basically run Phillips Arena.

It seems like Ozanian arrived at the $110 million number by the simple math of a deal that would potentially bring the Thrashers to Winnipeg. As we discussed before, True North Entertainment and Sports would likely attempt to relocate the Thrashers if the Coyotes stay in Phoenix. They would reportedly be willing to make that deal for $170 million, with $60 million of that money going to the NHL as part of a relocation fee. Long story short, that would mean that the Atlanta Spirit ownership group would get $110 million from that sale, so it makes sense that they’d take that much from a local group too.

Forbes values the Thrashers at $130 million and that is, indeed, a pretty cushy arena deal. That being said, the team only made one appearance in the playoffs (they were swept in 2007 by the New York Rangers) and have struggled with attendance issues for years. Ozanian said that the team has only been profitable in its first two seasons when Ted Turner served as their owner.

It’s an interesting proposition, though. If the team really is worth $130 million, then maybe a new ownership group could actually make it work in Atlanta after all. The team hasn’t ever been a consistent winner in their time, but new GM Rick Dudley is putting together some interesting pieces for the future.

We’ll just have to wait and see which city will end up cheering those promising young players on, though.

  1. goober97 - May 2, 2011 at 5:09 PM

    Um, no. That doesn’t mean that the NHL “could work” under that proposal. Let’s follow the math, shall we?

    Non-ticket revenue ~ $7 million
    Let’s be unbelievably optomistic and say that the Thrashers will average 17,000 a game
    Now let’s be absurd and say that they’ll average $70 a ticket (current average is just less than $50)
    That will net the Thrashers ticket revenue of ~ $48,790,000
    Total revenue (remembering that they don’t control the arena, so no added revenue from concessions, parking or suites) = ~ $55, 790,000
    The current NHL salary cap is just shy of $60 million, so in that pie-in-the-sky projection, not including any front office costs, the Thrashers still couldn’t field a team that is at the top end of the salary cap.

    Now going to current numbers (13,000 a night with an average of $50 tickets), they would bring in just $26,650,000 a year. Added to the whopping $7 mil non-ticket revenue, that $33 million wouldn’t get the Thrashers a team that makes the salary cap minimum, let alone be profitable, now would it?

    Bottom line – it’s no where near profitable to own a team if you don’t own/control the building you play in. Why would anyone want to buy the Thrashers under that proposal?

    • James O'Brien - May 2, 2011 at 5:53 PM

      I agree that the Thrashers situation is unlikely to work out, but a decent arena bargain and lower sale price at least make such a scenario more feasible. Some sports owners are comfortable with losing money (to an extent, naturally) because they consider owning a pro franchise to be a vanity property.

      Naturally, there are questions regarding the Winnipeg market, too.

  2. djdvd - May 2, 2011 at 6:26 PM

    Time to get the whalers back!

  3. donttouchthedirtypenny - May 3, 2011 at 6:35 AM

    Too many teams and not enough viable markets. Bettman has made many blunders, but his worst was over expansion. 30 teams is way to many for any sport, let alone one that is followed closely on only half the continent. Perfect size was 24 teams. Eliminate 6 teams and disperse the players. This would concentrate the talent pool, create better hockey, maybe shorten the season — even die hard fans have trouble watching the Finals in June. Which teams to rid? Florida, Atlanta, Phoenix for starters. Other candidates: Dallas, Nashville, Columbus.

  4. donttouchthedirtypenny - May 3, 2011 at 6:37 AM

    Why hasn’t the NHL considered relocation to Portland, OR or Seattle? They are good junior hockey markets, and would have a geographical rivalry with each other and Vancouver.

    • rupertslander - May 3, 2011 at 3:46 PM

      Seattle has an archaic building and refused to build a new one to save their basketball team. They’re not going to build a new one in hopes of landing a hockey team.

      Portland is not much bigger than Vancouver, which proved unable to support both basketball and hockey.

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