New Jersey Devils finally find new ownership investors to ease debt, says report
While it's not the Nashville relocation turmoil of 1995, the New Jersey Devils have played through the 2012 Stanley Cup Playoffs under a cloud of uncertainty about their future.
There's the $80 million they owe to banks, and as of last November "over $250 million of debt piled on the team and arena," according to Forbes. There's the schism between owners Jeff Vanderbeek and his minority owners. There's the looming specter of bankruptcy to help wipe away the debt.
But as the Devils head back to Newark for Game 5 of the Stanley Cup Final, Chris Botta of Sports Business Daily brings glad tidings: There's a new investor group finalizing a deal to join the Devils' ownership.
Via Sports Business Journal (sub. req.):
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.
Botta reports the deal should be announced about two weeks after the completion of the season.
As far as the investors go, I've heard it's a group based in Ontario that's been in conversations with Vanderbeek and the NHL for some time. They would join as minority partners to Vanderbeek.
Vanderbeek told CNBC that he was having "constructive conversations" with equity partners about the Devils. At his State of the NHL Address, NHL Commissioner Gary Bettman said:
"The New Jersey situation as we understand it at its most up to date point is that the club, Jeff Vanderbeek, is working on both refinancing the debt on the club and an equity raise and he appears to be fairly confident that he can pull this off in due course in the next few weeks," Bettman said. "Since I've been in touch with the banks on a regular basis, we seem to be on track."
While the Devils have certainly benefitted financially from this playoff run, it's difficult to imagine the team not going through some sort of bankruptcy process with the new minority owners in order to wipe away their debt.
Bottom line is, however, appears New Jersey's found someone willing to tackle it. Now, we all wait to get Cory Booker's evaluation of them on the "high-class, highfalutin, huckster and hustler" scale.
