Thursday, October 05, 2006

New Potential Penguins Owner

The Pittsburgh Penguins have a new agreement in place for a new owner. Jim Balsillie of Peterborough, Ontario and owner of Research in Motion (who make Blackberrys) has agreed in principle to buy the team for $175 million. This is the second person who has agreed in principle to buy the team. In July, Howard Fingold reached an agreement that fell apart. The sale price was approximately the same.

Balsillie claims he wants to keep the Penguins in Pittsburgh, although there has long been speculation that they might be moved (for example to Kansas City). Since Balsillie is Canadian speculation about moving a team to Hamilton or other points in southern Ontario exists.

The problem with Pittsburgh is not the fanbase, it is quite strong. The problem is a lack of an arena. Mellon Arena is the oldest in the NHL and has not been kept up well. There have been attempts, which have been largely unsuccessful to get local politicians to build a new arena.

Pittsburgh is a strong hockey market. If an owner steps up and builds a new arena (I have no idea if that is in the plans) it should remain a great place for hockey. The owners reap the benefits from the arena existing, and have built NHL arenas in the past, its not the job of local taxpayers to finance the NHL by building them arenas.

Here is the TSN story on the potential sale.

The governor of Pennsylvania, other politicians, and local community leaders have urged the Penguins to seek an alternate deal than the one they currently have with Isle of Capri, a gambling outfit that is seeking to bring slots to Pittsburgh. There is a Plan B according to this article in the Pittsburgh Post-Gazette. However, the Penguins and Lemieux maintain that they are bound by the Capri deal even if there is a Plan B in place.

Isle of Capri may or may not win the contract, which is set to be awarded next year. If the contract is awarded to Isle of Capri, then the Penguins get their arena, and the City of Pittsburgh and the tax payers pay nothing (for the arena). However, if the Capri deal falls through, they may not get a new stadium, and the team probably moves to another market, possibly in Canada.

What this does is put political pressure on the state gambling commission to give the bid to Isle of Capri, a smart business decision by Carpi, but at what cost to a small market that loves hockey and a city coming back from industrial decay?
The Isle of Capri was the plan under Lemieux et al. I think they were pretty certain it wasn't going to work and hence were spenidng more time trying to sell the team instead of trying to find a plausible way to build a new arena.

What Jim Balsillie plans in regards to a new arena, I have no idea.
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