Last year, Don Maloney was voted General Manager of the year in the National Hockey League. This year he may have an even tougher job holding together the Phoenix Coyotes.
Maloney built the Coyotes hugely successful 2009-10 team primarily through deft trading and smart shopping in the free agent bargain aisle. While a few pre Maloney draft picks are impacting the team at the NHL level, the club hasn’t gotten a lot of help from more recent drafts. Hopefully that help is on the way because the budget constraints of league ownership will likely force the Yotes’ into more than desired roster turnover for the 2010-11 season.
Only a handful of people – Don Maloney, Gary Bettman, Bill Daly and a handful of NHL Governors know what the Coyotes actual player budget is for 2010-11. Since Maloney said it was an increase over last year (and we are pretty sure it was in the $44MM neighborhood last time around) I’m thinking it is in the neighborhood of $47.4. That’s midway between the cap floor ($43.4) and the cap midpoint ($51.4) And if it’s not that high, owners in waiting Anthony LeBlanc and Daryl Jones may be chewing on the NHL to loosen up the budget pocketbook a little so the Coyotes can try to keep one or two of their highly valued UFAs.
It’s not the end of the world. Even with new owners, it is likely the Coyotes will have a self imposed budget until revenue streams improve. And with a number of young players seemingly ready to challenge for NHL jobs, the budget should be manageable. Unfortunately the margin for error is not great.
Maloney is doing everything he can to stretch his checkbook. He’s already signed four restricted free agents – Adrian Aucoin, Scottie Upshall, Taylor Pyatt and Woltek Wolski. Wolski got a big contract (2 years at $3.8MM) worthy of his status as the team’s most skilled forward. Pyatt and Aucoin both accepted backloaded two year deals to help the payroll logjam and Upshall is in on a one year contract. In a perfect world the Coyotes would have liked to lock Upshall up for a longer tern but with the uncertainty of ownership and Upshall coming back from ACL surgery, it was the best deal for all concerned. The downside is that he will be an unrestricted free agent next June and may be in line for a much larger contract.
Think of it as Maloney’s version of “buy now, pay later”.
That good news has somewhat obscured the pressing issues facing the Yotes. The team has four unrestricted free agents – Matthew Lombardi, Zbynek Michalek, Lee Stempniak and Derek Morris – and all are free to sign with any team in the league on July 1st.
Michalek was always the least likely to return to Phoenix. The 27 year old defenseman has been one of the Coyotes strongest players and best values since joining the team in a trade with the Minnesota Wild. He’s in line for a whopping raise from his current $1.25MM wage to something in the $3.5 – 4MM neighborhood and will command a 4-5 year term. That’s a lot of money for a defensive defenseman. With the Coyotes depth on defense and the need to open spots for younger players, it’s unlikely he can be fit into the budget going forward. It has been widely speculated that Z will join his kid brother in Ottawa. Don’t be surprised to see his rights swapped to another NHL team in advance of the July 1 UFA marketplace.
I’ve always felt Lee Stempniak would not stay in Phoenix. A playoff rental, he took Upshall’s place on the forward lines. Stempniak has been a streaky player throughout his career, best illustrated by his 14 goals in 18 regular season games after joining the team and then being zipped in the 7 game playoff series. Thanks for your service Lee, but unless the price drops to bargain levels, he won’t be back.
If Michalek does leave, it increases the chances Derek Morris will return. I thought there was only room for one of Morris or Aucoin on the backline but Derek is a favorite of team management and a permanent Valley resident. The hard reality of the market place is that he will have to accept less money for the privilege but I don’t think there will be much of a market for his services. He may end up with a team friendly contract similar to Aucoin.
And finally, Matt Lombardi is the fourth unrestricted free agent of note. Lombardi, who came from Calgary in Maloney’s signature trade (along with the pick that turned into Brandon Gormely), is the free agent who seemed most likely to resign with the team. Losing him will hurt.
While Lombardi is a not to be confused with a number one center, he’s an excellent player who brings great speed, versatility and energy to the team. He’s a good penalty killer and scored a number of key goals last year. And he's also a part of the young veteran core that really carried the team last year.
Players with similar skills and results have gotten free agent contracts in the $3.25MM range for 3-4 years. It would seem that kind of deal could fit under the current constraints. Unless the bidding becomes prohibitive I expect Maloney will be in on Lombardi.
The Coyotes have in house replacements available but organization depth will clearly be affected. Kyle Turris, who showed signs of fulfilling his immense promise in the second half of last season, could step in for Lombardi. Don Maloney commented on NHL radio during the draft that he thought Turris would be in the NHL this year. Last year’s first draft pick, Oliver Ekman-Larsson is likely to secure a position on defense. Upshall’s return will mitigate the loss of Stempniak. If Kurt Sauer can return from post concussion syndrome, he could step in nicely for Michalek.
Free agent additions? Don’t expect much. Unless a goalscorer becomes available at bargain prices, the Coyotes seem pretty set. They have a ton of role players and need to work some younger blood into the lineup.
Trades? Not likely. Jim Vandermeer’s contract eats up an inordinate amount of cap space and he could be moved in a deal similar to the David Hale/Todd Fedoruk/Radim Vrbata trade last year. One possibility is the Coyotes regular trading partner the New York Rangers. The Rangers need a team to take Donald Brashear off their hands. Brashear is heading to the KHL but still carries a $1.4MM cap hit because he signed his contract over the age of 35. The Coyotes can accommodate the cap hit as long as no cash goes out. Vandermeer would fill a need as a 6th/7th defenseman in New York and the Rangers have plenty of money to buy him out or bury the contract in the minors. That additional wiggle room could make the difference between the Yotes’ keeping a few of their UFAs.
It will be an interesting few days but most of the Coyotes business will probably be outbound this week. It’s a shame because some very big contributors may not be here next year. But in a salary cap world, especially one muddled even more by the team’s ongoing financial uncertainty, you get the feeling that the reigning GM of the year has one or two big time performances up his sleeve. Hope he saved his greatest hits for the encore.
Sunday, June 27, 2010
Tuesday, June 1, 2010
Sometimes, "The Check is in the Mail", Doesn't Quite Cut It.
It went something like this. The City if Glendale took a deep breath and voted to meet the National Hockey League’s demand for $25MM in guarantees to cover any losses the Coyotes incur in 2010-11. The City, expecting to make a deal with either the Jerry Reinsdorf group or Ice Edge Holdings, nodded and smiled, saying it was likely the money would never be needed.
And so they lived happily ever after, right?
Not quite. The NHL had a slightly different view of the proceedings. Partly because of the large number of NHL teams opening in Europe (including the Coyotes) this year and partly because other teams (desperately) need a schedule in hand to sell tickets; the NHL wants to publish the 2010-11 schedule in late June, three weeks earlier than usual. And if the Coyotes were to be slotted in Arizona and not some other far away city, the league wanted to see the money. Now.
As others have reported, the league was ready to pull the plug on the Coyotes. Ready as in a 5PM deadline or we’re going to Winnipeg…or Kansas City…or somewhere, anywhere else. NHL Deputy Commissioner Bill Daly was in town to collect and he wasn’t leaving without a check. The alternative? There wasn’t one. Daly was here to foreclose. The patience of the NHL has clearly been stretched by the Coyotes predicament.
And for once, the Canadian media wasn’t engaging in sensationalism. It was dead nuts serious. I heard the story as it was happening but was waiting to learn more from the Brahm Resnick’s of the world. After all, they have better sources than I do, don’t they?
But once again, Glendale produced. As in $25MM borrowed from a very large ($400MM+) capital expenditures fund held by the city. And you thought all local governments were broke.
So what got us to this latest crisis?
One can reasonably assume that there is some friction between the Jerry Reinsdorf group and Glendale. After all, they have a Memorandum of Understanding, with The City. That usually is the precursor to a formal lease. But for whatever reason, we’re not getting from station to station very easily here. Our guess is that the City is doing everything possible to build a lease that insulates themselves against legal action from the Goldwater Institute. And we’re also guessing that Team Reinsdorf is driving a very hard bargain. After all, this ain’t a blue sky sale. So both sides continue to negotiate, posture and talk. Hopefully.
And by calling Ice Edge Holdings and asking if they would still like to talk about the Coyotes, Glendale City manager Ed Beasley clearly wasn’t above putting some pressure on the Reinsdorf group. The good folks at Ice Edge said sure (well maybe) we’ll get back in this thing. With of course a guarantee of exclusivity. When you’ve been ditched once, a fairly firm pre nuptial is usually recommended.
But alas, there’s no exclusivity for Ice Edge and the assumption is that Team Reinsdorf is still in play. John Kaites was joined at the hip to Daly at the recent Glendale Council meeting and we’ve heard he’s been involved not only in negotiations but also staying close to the Coyotes decision making process. So that would indicate it’s a when, not if for the Reinsdorf Group to take control of the franchise.
Meanwhile, Ice Edge quietly remains on the sidelines. We say quietly because the very glib (at least on Twitter) Daryl Jones has been quiet lately. That may be a good thing. If the Ice Edge talks with Glendale are “taking a nap” (not my words, those of that well known unnamed source) then I expect they will either fade from the scene or get a wakeup call soon. Perhaps they already have. Apparently though, and to the chagrin of many local hockey fans, they are the fallback plan.
What we do know is that the Coyotes will play in Glendale next year. They may or may not be the Arizona Coyotes (they certainly would be by 2011) but there will be hockey here next year. Season ticket invoices have been mailed, the NHL schedule is going to be released in three weeks (and did someone say that the Coyotes are going to open at home Saturday October 16th against a certain despised Western Conference team?) and we can turn our attention to hockey again.
Aside from the risky nature of the investment, it’s been asked of me and others how any deal for the Coyotes can work right now. Here are four important things to consider.
Bank financing is starting to thaw. The money spigot isn’t exactly running wide open yet but business conditions are improving. Banks are lending. And that’s a good thing. Heck, even Basha’s has lined up $210MM to try and turn that battleship around. Sports teams used to be able to get money easily. A return to the go-go days is unlikely but a liquid money supply is important to making this deal work.
Secondly, for any group trying to buy a team, this is a clean slate and a fresh start. No old bills, no lose financial ends and no legal fights with past and former owners. It’s a clean deal. Unlike say, the Atlanta Thrashers, where the team owners have spent most of the franchises existence in court suing each other. In business, clean deals are good. Don’t underestimate the importance of a fresh start.
Next, there’s the Coyotes organization. On the playing side, it’s in pretty good shape. A roster loaded with value, a farm system with significant assets and a great management and coaching team in place. And on the business side, it’s basically a shell that new owners can staff as they see fit.
And finally, there’s the small matter of what happened at the end of the season. 8 straight sellouts including all four playoff games. New sponsors coming on for the playoffs. A point in time where the Coyotes actually dominated sports talk radio. OK, nobody dominates KTAR other than the house teams but there even were days (hours?) when they actually sounded more like their worthy competitors. Heck, even Dave Byrnes talked about hockey a few times. Anyone who was watching closely knows this isn’t a doomed team that plays 50 miles out of town. Quite the contrary, I’d say.
All good things and all essential for the success of new ownership.
Of course, all of these things mean little if the new owners cannot build an organization that wins on and off the ice. There’s not a large margin of error for the new owners, whoever they turn out to be. And for the City of Glendale, there’s really no margin of error left. They have to, no make that need to, get new owners in here right now to rebuild the front office, make sure Don Maloney has a competitive budget to retain key players and get a staff on the streets selling tickets and advertising.
Interesting sidebar – I had friends from Toronto visit during the playoffs. They couldn’t believe the arena location was an issue and loved the entire experience. “Feels like a hockey town to me”, said my friend.
Yeah, it did feel like a hockey town, even if it was just a month. But what a glorious thought it is that this could be a hockey town for a long, long time. And what a feeling it would be.
And so they lived happily ever after, right?
Not quite. The NHL had a slightly different view of the proceedings. Partly because of the large number of NHL teams opening in Europe (including the Coyotes) this year and partly because other teams (desperately) need a schedule in hand to sell tickets; the NHL wants to publish the 2010-11 schedule in late June, three weeks earlier than usual. And if the Coyotes were to be slotted in Arizona and not some other far away city, the league wanted to see the money. Now.
As others have reported, the league was ready to pull the plug on the Coyotes. Ready as in a 5PM deadline or we’re going to Winnipeg…or Kansas City…or somewhere, anywhere else. NHL Deputy Commissioner Bill Daly was in town to collect and he wasn’t leaving without a check. The alternative? There wasn’t one. Daly was here to foreclose. The patience of the NHL has clearly been stretched by the Coyotes predicament.
And for once, the Canadian media wasn’t engaging in sensationalism. It was dead nuts serious. I heard the story as it was happening but was waiting to learn more from the Brahm Resnick’s of the world. After all, they have better sources than I do, don’t they?
But once again, Glendale produced. As in $25MM borrowed from a very large ($400MM+) capital expenditures fund held by the city. And you thought all local governments were broke.
So what got us to this latest crisis?
One can reasonably assume that there is some friction between the Jerry Reinsdorf group and Glendale. After all, they have a Memorandum of Understanding, with The City. That usually is the precursor to a formal lease. But for whatever reason, we’re not getting from station to station very easily here. Our guess is that the City is doing everything possible to build a lease that insulates themselves against legal action from the Goldwater Institute. And we’re also guessing that Team Reinsdorf is driving a very hard bargain. After all, this ain’t a blue sky sale. So both sides continue to negotiate, posture and talk. Hopefully.
And by calling Ice Edge Holdings and asking if they would still like to talk about the Coyotes, Glendale City manager Ed Beasley clearly wasn’t above putting some pressure on the Reinsdorf group. The good folks at Ice Edge said sure (well maybe) we’ll get back in this thing. With of course a guarantee of exclusivity. When you’ve been ditched once, a fairly firm pre nuptial is usually recommended.
But alas, there’s no exclusivity for Ice Edge and the assumption is that Team Reinsdorf is still in play. John Kaites was joined at the hip to Daly at the recent Glendale Council meeting and we’ve heard he’s been involved not only in negotiations but also staying close to the Coyotes decision making process. So that would indicate it’s a when, not if for the Reinsdorf Group to take control of the franchise.
Meanwhile, Ice Edge quietly remains on the sidelines. We say quietly because the very glib (at least on Twitter) Daryl Jones has been quiet lately. That may be a good thing. If the Ice Edge talks with Glendale are “taking a nap” (not my words, those of that well known unnamed source) then I expect they will either fade from the scene or get a wakeup call soon. Perhaps they already have. Apparently though, and to the chagrin of many local hockey fans, they are the fallback plan.
What we do know is that the Coyotes will play in Glendale next year. They may or may not be the Arizona Coyotes (they certainly would be by 2011) but there will be hockey here next year. Season ticket invoices have been mailed, the NHL schedule is going to be released in three weeks (and did someone say that the Coyotes are going to open at home Saturday October 16th against a certain despised Western Conference team?) and we can turn our attention to hockey again.
Aside from the risky nature of the investment, it’s been asked of me and others how any deal for the Coyotes can work right now. Here are four important things to consider.
Bank financing is starting to thaw. The money spigot isn’t exactly running wide open yet but business conditions are improving. Banks are lending. And that’s a good thing. Heck, even Basha’s has lined up $210MM to try and turn that battleship around. Sports teams used to be able to get money easily. A return to the go-go days is unlikely but a liquid money supply is important to making this deal work.
Secondly, for any group trying to buy a team, this is a clean slate and a fresh start. No old bills, no lose financial ends and no legal fights with past and former owners. It’s a clean deal. Unlike say, the Atlanta Thrashers, where the team owners have spent most of the franchises existence in court suing each other. In business, clean deals are good. Don’t underestimate the importance of a fresh start.
Next, there’s the Coyotes organization. On the playing side, it’s in pretty good shape. A roster loaded with value, a farm system with significant assets and a great management and coaching team in place. And on the business side, it’s basically a shell that new owners can staff as they see fit.
And finally, there’s the small matter of what happened at the end of the season. 8 straight sellouts including all four playoff games. New sponsors coming on for the playoffs. A point in time where the Coyotes actually dominated sports talk radio. OK, nobody dominates KTAR other than the house teams but there even were days (hours?) when they actually sounded more like their worthy competitors. Heck, even Dave Byrnes talked about hockey a few times. Anyone who was watching closely knows this isn’t a doomed team that plays 50 miles out of town. Quite the contrary, I’d say.
All good things and all essential for the success of new ownership.
Of course, all of these things mean little if the new owners cannot build an organization that wins on and off the ice. There’s not a large margin of error for the new owners, whoever they turn out to be. And for the City of Glendale, there’s really no margin of error left. They have to, no make that need to, get new owners in here right now to rebuild the front office, make sure Don Maloney has a competitive budget to retain key players and get a staff on the streets selling tickets and advertising.
Interesting sidebar – I had friends from Toronto visit during the playoffs. They couldn’t believe the arena location was an issue and loved the entire experience. “Feels like a hockey town to me”, said my friend.
Yeah, it did feel like a hockey town, even if it was just a month. But what a glorious thought it is that this could be a hockey town for a long, long time. And what a feeling it would be.
Subscribe to:
Posts (Atom)
