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Bettman denies NHL taking over Devils — sale imminent?

Aug 8, 2013, 12:34 PM EDT

Gary Bettman Getty Images

Today in New York, NHL commissioner Gary Bettman denied a report that the league is preparing to take over the financially troubled New Jersey Devils.

“If the suggestion is we’re going to take over the Devils, it’s not accurate,” said Bettman, per Rich Chere of the Star-Ledger.

Not accurate, perhaps, because a Devils sale could be imminent, according to The Record’s Tom Gulitti.

While it’s tempting to compare the Devils’ ownership situation to that of another problem NHL franchise, the Phoenix Coyotes, it’s not really appropriate to do so.

The big difference between the two situations is that relocation was only an option for the Coyotes. The Devils, by all indications, are staying put in Newark. What’s really needed in New Jersey is a deep-pocketed ownership group that can haul the club out of debt.

CSN Philly has more on the story, with a quote from deputy commissioner Bill Daly — “…to the extent it suggests that league is intending to take over the club, it is inaccurate” — as well as one NHL governor who says there are buyers for the Devils.

Related: 76ers ownership group reportedly interested in buying Devils

  1. 950003cups - Aug 8, 2013 at 1:45 PM

    This team can’t get a break.

  2. nj666 - Aug 8, 2013 at 2:29 PM

    I love how the b/s article has 26 comments while the one with facts has 1. People just foam at the mouth to bash the devils.

    • endusersolutions2013 - Aug 8, 2013 at 3:31 PM

      Could it also have to do with the timing of the articles?

  3. scoocha - Aug 8, 2013 at 2:49 PM

    This situation is primarily different than Phoenix because people actually care about hockey in NJ/Northeast as opposed to AZ/Southwest.

    • redridershoottheireyeout - Aug 11, 2013 at 12:38 AM

      not the boys in the hood that occupy the area around the arena in Newark they don’t!

  4. bullwinkle88 - Aug 8, 2013 at 2:50 PM

    Move them to Quebec. It’s the best thing the NHL can do.

    • rojersey35 - Aug 8, 2013 at 3:37 PM

      Yea let’s move the team out of the New York Metro area. It’s only the biggest market in the United States. And move them to a small market who already failed at supporting the team in Quebec. Brilliant business move.

      • govtminion - Aug 8, 2013 at 5:28 PM

        I’m against the idea of moving the Devils, but surely you’d agree that the Quebec issue had less to do with support of the team and more to do with economics of the time. I have trouble seeing Quebec City as a ‘small market’ in hockey terms at this point- maybe not a huge metropolis, but much like Winnipeg more than capable of supporting an NHL team now that times have changed for Canadian franchises’ way of business.

  5. flydommo - Aug 8, 2013 at 2:52 PM

    I am a Flyers fan but I have always enjoyed (and sometimes endured) the healthy rivalry between the Flyers and Devils. Hopefully, the Devils manage to recover economically soon. I am wondering, though, how it can be that a franchise not exactly known for overspending and having won three Cups in the last 18 years can be so deep in the red.

    • eatitfanboy - Aug 8, 2013 at 4:20 PM

      Because the Rangers hoover up all the local TV money.

      • flydommo - Aug 8, 2013 at 4:44 PM

        Bad for the Isles as well I daresay.

      • DED - Aug 8, 2013 at 5:16 PM

        The Rangers, Islanders, and Devils games are all on the MSG-Networks. Yes, the Rangers get top billing (duh) but with MSG, MSG+, and MSG2, they’re getting air time. It’s not like the Devils aren’t getting some money for that TV coverage.

  6. rojersey35 - Aug 8, 2013 at 3:42 PM

    The team got off to a rocky start in Newark. If they can FINALLY get some stability from ownership they will be fine. Its a solid fan base which is still growing and the Rock is a first class arena. Relocation would make 0 sense. While I am not a big fan of Bettman he is absolutely right here to try and keep the Devils in Jersey.

  7. blkeskimo1785 - Aug 8, 2013 at 6:42 PM

    So, it looks like Quebec will get their team after all!…?

    • flydommo - Aug 8, 2013 at 7:04 PM

      Only in case of an expansion of the league, the Devils will not be going anywhere and stay in Newark.

    • dirt2013 - Aug 9, 2013 at 10:10 AM

      I doubt that the city of Quebec wants a team that plays in the western conference.Do you think that the Wings or BJ’s are going back out west? If their is an expansion I would expect the teams to be from the west and to play in the west.

  8. mattyo99 - Aug 8, 2013 at 9:47 PM

    The reason there broke, too many rangers fans in north jersey
    Too many flyers fans in south jersey

  9. kane987245 - Aug 8, 2013 at 9:54 PM

    I am a Devils fan, have been for all 22 years of my life, and Vanderbeek, I love everything you have done, but seriously, step down as the owner and/or allow the sale to people who will able to HELP get the Devils out of this mess and not DEEPER into it. It is the only problem the Devils truly have ATM. Players are most replaceable and can require great young talent through the draft. You do not get many chances to be financially stable and the current people interested seem genuine that they want to do just that, bring the organization back to stability.

    Moving them makes zero sense because I have been to The Rock many times for their games, it is the Grade A, High Class. Its exciting, the fans are great, and when they get going the place feels like it is shaking. I love being there every chance one can get. I hope this gets resolved soon and The Devils can start the season on SOME type of high note. Than again, the last time this was going on….i believe it was in 94/95…….=].

  10. wisbadgers - Aug 9, 2013 at 12:06 AM

    To all the Devils fans.

    I feel your pain. Now you’re gonna have all the Canadian haters on these boards touting how the Devils “must move to Quebec City” and “move them already” and “hockey can’t work in New Jersey”.

    Us Yotes fans had to deal with it for 5 years. I feel your pain!!!!

  11. blomfeld - Aug 9, 2013 at 12:22 AM

    A tax shield is the reduction in income taxes that results from taking an allowable deduction from taxable income. For example, because interest on debt is a tax-deductible expense, taking on debt creates a tax shield. Since a tax shield is a way to save cash flows, it increases the value of the business, and it is an important aspect of business valuation.

    *** Example ***

    1) Case A

    Consider one unit of investment that costs $1,000 and returns $1,100 at the end of year 1, i.e. a 10% return on investment before taxes. Now assume tax rate of 20%. If an investor pays $1,000 of capital, at the end of the year, he will have ($1,000 return of capital, $100 income and –$20 tax) $1,080. He earned net income of $80, or 8% return on capital. The concept was originally added to the methodology proposed by Franco Modigliani and Merton Miller for the calculation of the weighted average cost of capital of a corporation.

    2) Case B

    Consider the investor has an option to borrow $4000 at 8% interest rate (same rate as return on capital in Case A). By borrowing $4,000 in addition to the $1,000 of his initial equity capital, the investor can purchase 5 units of investment. At the end of the year, he will have: ($5,000 return of capital, –4,000 repayment of debt, $500 revenue, –$320 interest payment, and –$(500-320)*20%=–$36 tax). Therefore, he is left with $1,144. He earned net income $144, or 14.4%.

    The reason that he was able to earn additional income is because the cost of debt (i.e. 8%) is less than the return earned on the investment (i.e. 10%). The 2% difference makes income of $80 and another $100 is made by the return on equity capital. Total income becomes $180 which becomes taxable at 20%.

    “may our ‘torches of decency’ burn brightly and expose those who seek to furtively profit for themselves in the dark” … Corinthians 36:9

    • spitfisher - Aug 9, 2013 at 10:49 AM

      good formulas above, one can not ignore how many teams and fan base are in the general area as well as some stupid contracts they signed. I believe if the hard core fans really want a team in jersey they have to realize it will likely cost them a decade of mediocrity, much like Pittsburg when they were looking for an owner back in the 90s and Mario was still owed 30 mill, even though he wasn’t playing.

      the more appealing sale to a buyer and quicker response profitability and to a competitive team will likely have to be elsewhere.

  12. icelovinbrotha215 - Aug 9, 2013 at 6:40 AM

    There are too many teams within the immediate area. PHI. NYR. NYI. NJD. I do hope that Jersey finds a way to be successful but I’m sure the suitors have inquired about relocation. They would dumb not to practice due diligence.

  13. chrisk61 - Aug 9, 2013 at 10:17 AM

    devils fans don’t support the team. attendance isn’t very good. lots of empty seats. josh harris is a risk taker. he had a pleasant surprise in his first yr with the sixers, with a doug collins-coached playoff birth, but then reality set in and team is a mess. this guy may be smart but could also lose lotsa money in pro sports.

    • nygnjd - Aug 9, 2013 at 4:29 PM

      You are basing this on what exactly? Attendance has been rising. Last season all but 2 home games were sold out. Average attendance was 17,114. The Rock only has 17,625 seats for hockey. The empty seats are from companies buying up seats and then not using them.

  14. kvanhorn87 - Aug 9, 2013 at 7:18 PM

    How about they move the team to Philly? They could support another team in town. Then the Sixers could get out of the Flyers and build their own Sixers and Devils complex

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