After two seasons of missing the playoffs and pinching pennies under cash-strapped owner Tom Hicks, things are beginning to look up for the Dallas Stars.
THN.com has learned Calgary oilman Bill Gallacher, who also owns the Portland Winterhawks of the Western League, heads up a group of investors that has reached an agreement in principle to buy the Dallas Stars for about $225 million. The deal has yet to be signed and either side could back out of it, but it appears the deal will get done soon.
One possible scenario has Dallas Mavericks owner Mark Cuban jumping back into the fray. Cuban was reportedly turned off by the $350 million price being asked by Hicks, but might be enticed by a much lower price. Owning the Stars would effectively give Cuban 100 percent of the revenues generated at the American Airlines Center, one of the busiest venues in North America. Currently co-tenants in the arena, the Mavericks and Stars split arena revenues 50-50, including non-sports events such as concerts.
That’s enormously good news for the Stars, who were once one of the NHL’s biggest spenders and revenue producers and were also a perennial contender. Ever since Hicks encountered a world of financial hurt, the Stars have been hurting, too. Their defense corps combined barely made more than Nicklas Lidstrom did all by himself last season.
Gallacher is a billionaire with very deep pockets and an established background in hockey, so that should help. But regardless of who owns the Stars, the stability in ownership will give the team some much-needed direction and focus, something that has been lacking for some time. In terms of payroll, the Stars look to be in very good shape, unlike a number of teams that are facing cap issues.
So far, the Stars have $44.5 million, which is essentially the salary cap floor for this season, devoted to 12 forwards, seven defensemen and two goaltenders. That gives them plenty of room to sign restricted free agents James Neal, Nicklas Grossman and Matt Niskanen. Fabian Brunnstrom has an arbitration hearing scheduled for July 23.
And after a couple summers of essentially sitting on their hands during free agency, the Stars will finally have some money, and more importantly, cap space to make some deals. Should Gallacher’s group be committed to spending to the cap, that will leave plenty of leeway for the Stars to take on players who cannot be jammed into other rosters because of their salaries or salary demands.
And all of that, with GM Joe Nieuwendyk at the helm, should be enough to bring the Stars back to their place in the league as an upper-tier franchise. During their time in Dallas, the Stars have done almost everything right. They won a Stanley Cup in just their sixth season in Texas and built a formidable business model under former team president Jim Lites.
And the NHL should require any team in a non-traditional hockey market looking to grow the game to follow the blueprint Hicks had for the Stars, who built numerous rinks and funded minor hockey programs in the area.
It will be good to see the Stars return to stability because when healthy, they are one of the league’s stronger franchises. The purchase price is far more than the $50 million Hicks paid for the team in 1995 and a fair price for the asset, but less than the $247 million they were valued at by Forbes magazine last season and well below the $350 million Hicks was reportedly seeking.
But the Stars are a money-maker, showing average profits of about $10-15 million per year in a viable market. And no, there’s no chance Gallacher, if he finalizes his purchase, will move the Stars to Portland, where he owns his junior team, or to a Canadian city.
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