What the Nashville Predators ongoing sale means for the Ottawa Senators
Professional sports ownership at the top tier in North America is a scarce market.
There are only 124 assets available between the NFL, NHL, NBA, and MLB, and the number of owners is even smaller in an era when multi-team ownership has become more common for the ultra-rich. And when the ultra-rich own a team, they are less and less likely to part with it – especially with television rights in the United States exploding.
That’s why it’s notable that three NHL teams are likely going to change hands in a span of 18 months.
The Pittsburgh Penguins majority ownership was transferred to Fenway Sports Group, which also owns the Boston Red Sox and Liverpool, last December for around $900 million. That valuation and sale price will likely be closer to $1.1 billion in a couple of years – team sales typically come with certain sliding factors, for example eventually Fenway Sports Group will likely buy out the remainder of the stakes owned by Mario Lemieux and Ron Burkle.
The Nashville Predators are in the midst of a slow sale that will make former Tennessee governor Bill Haslam the majority owner. Haslam will initially be one of the minority owners, eventually transitioning to majority ownership by 2025.
According to Sportico, the Predators are valued at $775 million at this point for the sale. That valuation, and final payout, will likely be closer to $900 million by 2025.
Which brings us to the following question, what does this mean for the Ottawa Senators?
When Eugene Melnyk passed away he left ownership of the team to his daughters, Anna and Olivia, whom by all indications appear ready to sell the team. The Senators have retained Galatioto Sports Partners, a bank that focuses on advisory services in the sports industry, to help with the potential sale.
This all comes out at a time when Sportico has recently released their NHL franchise valuations. The average NHL franchise was valued at $1.01 billion USD by Sportico, while the Toronto Maple Leafs ($2.12 billion) and New York Rangers ($2.01 billion) led the pack with more than a $2 billion valuation.
The Senators were valued at $655 million, 27th on the 32-team list.
It’s important to note that these valuations aren’t a great indicator of actual sale price. If there was a free market, where all teams were available all the time, $655 million would probably be fair. But because of the scarcity of NHL teams, that price is essentially a list price in a seller’s market.
Multiple NHL front office executives have explained to me in the past that those valuations are nice and give a benchmark for where you stand in the league, but the idea that the Maple Leafs or Rangers would only sell for $2 billion – if they were ever sold – is laughable.
The Senators have their flaws, the arena location is a big one for any potential buyer, but the recent memorandum of understanding for a new downtown arena and Gary Bettman’s commitment to current franchise locations (see Arizona), both raise potential sale price and strengthen the team’s standing.
Looking at what happened with Pittsburgh and Nashville, it’s realistic to price point a final sale of the Senators would likely be closer to $800 million.
It’s also likely the final flurry of team sales we’ll see for a while in the NHL. While teams have been selling more minority shares lately, venture capitalists have been circling the NHL, majority ownership in the NHL is turning into a family monarchy across the board, and the current ownership group – and their beneficiaries – are all rather excited about the upcoming renewal of Canadian TV rights that run through the 2025-26 season.
