News Tuesday that the Pittsburgh Penguins are on course to be sold to Boston-based holding company Fenway Sports Group LLC should not alarm Penguins fans. This is not a Jim Balsille situation, and the Pens do not need to worry about being relocated.
This transaction is all about money, and getting into the NHL by any means necessary.
The cost of the reported sale of the franchise could be as high as $850 million; in a recent Sportico.com article, the Penguins were valued at $845 million; and the cost of the most recent NHL expansion franchise (in Seattle) was approximately $650 million. The price for a team is not dropping. It is likely to continue to rise, along with the other three major North American sports. And when an opportunity to buy into the league presented itself, Fenway Sports jumped on it.
Fenway Sports Group’s principal owner, John W. Henry, is worth approximately $3.6 billion, according to Forbes. His FSG firm has majority and/or full ownership of Major League Baseball’s Boston Red Sox, The Boston Globe newspaper, the English Premiere League’s Liverpool F.C. soccer team, and the New England Sports Network, among other teams and sports leagues.
Henry is not some joker or quick-on-the-trigger sports newbie, only seeking to flip an asset. He has been there for the Red Sox’s greatest modern-day successes, including four World Series championships. He found a way to save Boston’s iconic Fenway Park from the wrecking ball. He was the owner when the Liverpool soccer team won the UEFA Champions League in 2018-19, and when Liverpool won the 2019-20 Premier League. He’s grown virtually everything he touches into a high-functioning operation. Even NBA superstar LeBron James wants to work with him; James is a minority owner in FSG, and has seen his investment in the company rise notably.
That said, Henry hasn’t been perfect; FSG’s purchase of Liverpool included a plan for the creation of a European Super League that would do away with relegation and promotion in favor of the NFL/NHL/MLB franchise model. It was a huge public relations misstep that almost instantly earned the ire of soccer diehards, and the concept was eventually withdrawn by FSG, with Henry personally apologizing for it. At the very least, you have to give Wilson credit for recognizing a European Super League was poison to his team’s customers and the sport in general. There are many owners out there, in every sport, who might have dug in their boots and stubbornly insisted on having their way. Henry heard fans and took action to satisfy them. That’s a good thing.
The Penguins team FSG is acquiring is one on the verge of a franchise rebuild; superstars Sidney Crosby and Evgeni Malkin are now 34 and 35 years old respectively. When those two choose to hang up their skates and retire, it will be all but impossible to replace their particular combination of skills and determination. The Pens will need another couple of franchise players just to keep up with the pace in the highly competitive Metropolitan Division. The only way you acquire those players, short of a crazily one-sided trade, is through the NHL’s draft system. The odds are against Pittsburgh getting as lucky as they did when they chose Crosby first overall and Malkin second overall (in different drafts). If they land even one new franchise superstar, it will be at great odds against them.
So, all Wilson and FSG will be able to do right now is continue paying and retaining the talent they currently have and having GM Ron Hextall rebuild on the fly. Do not expect any coaching or management changes in the immediate wake of the sale of the Pens. Wilson has no history of being an interfering owner, and the current administration has had less than one year on the job. It’s far more likely that FSG leaves things exactly as they are.
In a way, it’s sad to see this sale take place, as it removes current majority owners Mario Lemieux and Ron Burkle from holding the financial reins of the team. Lemieux and Burkle found ways to keep the Penguins in Pittsburgh and win three Stanley Cup championships as co-owners. Though they needed some lottery luck to do it, Lemieux and Burkle delivered.
Now, they leave ultimate control over the team to FSG. (Although there were rumors Lemieux may retain a small stake in Pens ownership and continue his present-day role in team management.) It’s the end of an era, and it may take some time for the Penguins to be Cup contenders on the level they’ve been over the years. But they look to be in good hands with FSG. It’s unlikely the company will be focused on cutting costs and icing a team without spending to the salary cap limit. Wilson has had success with his team investments because he’s good at delegating areas in which he has the little-to-no experience to proven expert team-builders and because he lets them do their jobs.
That’s what’s coming for the Penguins after the sale is made official. Pens fans should be relieved at this news. It could’ve been much worse. It could’ve been a bottom-line moneymaking transaction, but it isn’t. It’s more than likely to be a longer-term investment. And being owned by an FSG company that is estimated to be worth $7.35 billion can’t be seen as a bad thing. Hextall and team president Brian Burke will be able to do their jobs the way they did them before the sale rumors came out.
The checks will be paid by someone new, but otherwise, it’s full-steam ahead for the Pens. The Mario Era is going to end, and the challenge for Wilson and FSG will be to capture magic in the form of a few dazzling, generational players, the way Pittsburgh has done in the Crosby/Malkin Era. It will likely take a couple steps back to eventually get back to the juicy part of the competitive cycle, and it’ll likely take a little luck, too. But stranger things have happened, and we could see the Penguins return to being genuine Cup contenders sooner than later.
The good news is they’re going to be owned by a corporation that can pay the big bills. Now it’s on FSG to prove it can win at hockey’s highest level. Its history suggests it can.