We haven't covered this bit of news yet on Defending Big D but I'm sure most of you have heard about the whispers of the Dallas Stars planning on hiring Tony Tavares as an "interim" team president. While there has yet to be a formal announcement -- some in the Stars organization themselves are still in the dark -- the hiring is expected to be made sometime this week, if both sides agree on the conditions of the job.
Tavares is being hired in a capacity very similar to team president and will be expected to not only run the hockey operations for the Stars but to help move the sale of the franchise along. He has extensive experience with both sides of this job and is a logical choice for being a stop-gap option for a franchise that is essentially flying without a captain
After the jump, we look at the situation the Dallas Stars find themselves in as a business and why the Tavares hiring makes sense.
Here is the situation as we know it:
- Tom Hicks is essentially out as the owner of the Dallas Stars. He is not involved in the decision making process any longer and the lenders -- for all intents and purposes -- are now running the Dallas Stars. It was originally expected the lenders would take over the team for the short period it would take to sell the Stars, but as we all know that sale has hit a significant snag. Now the lenders are facing two choices: either sell now and lose the ability to recoup their money from the defaulted loans or invest further in the team now and gamble on the value of the Stars rising over the course of the season.
- There are four buyers interested in purchasing the team and one has already dropped out. From all reports we've read, there is not a bidding war going on for this franchise and none of the offers from the buyers are rising. As such, the asking price for the Stars (likely around $250 million to $275 million) is much, much higher than the current offers (around $225 million). That the Stars have lost significant value over the past two years and the fact that the market for sports teams is not as lucrative as it once was has also made selling this team much tougher.
- Taking the Stars into bankruptcy -- and therefore a possible auction -- is likely not a realistic option. The fact that the Stars share ownership of American Airlines Center will make going to bankruptcy court much, much more complicated than what happened with the Texas Rangers and will most likely not happen.
- Joe Nieuwendyk and front office executives will be headed to New York this week to talk with Gary Bettman to discuss the day-to-day operations of the Dallas Stars. While the NHL is not directly involved -- yet -- in the financial decisions the Stars are making (they aren't having to approve any decisions, at least) the league is definitely taking a direct interest in the sale of the club. Without a team president, the NHL is having to take a larger role in decisions the team is making -- therefore making the need for at the very least an interim president much bigger.
As it stands now, the Dallas Stars are not close to being sold. The lenders appear ready to invest in this team throughout the course of the season and as such it makes sense to have a president hired to oversee the hockey operations and business side of the franchise. The financials of the team are extremely limited and it's obvious right now that the Stars are struggling with marketing and public relations, only just keeping their heads above water.
Furthermore, a team president will be able to help sell the franchise to prospective buyers. This would allow Joe Nieuwendyk to focus more on the actual team and not the specific business side of the organization and also provide a means of communication from the team to the league. A team president that is in place -- especially one who is attractive to buyers -- could also help speed along the process of the sale.
Tony Tavares fits all the needs the Stars have and on paper appears to be the perfect option for the franchise.
Tavares was the original team president of the Mighty Ducks and has extensive experience in running hockey not only on a budget but selling hockey in a southern market as well. Tavares was also hired by the Montreal Expos as they went through financial disaster and the direct involvement of the MLB and the eventual move by the Expos to the Washington.
Don't worry, the Stars aren't going anywhere.
I've put interim in quotations because the exact job description that Tavares will hired under is likely not going to be the traditional team president role. This job will be tailor made for the Stars and there is a possibility that he might not be as temporary as a traditional interim president might be. Of course, any buyer that eventually does get the team has the choice of making the changes he feels is necessary. But for now, Tavares will be expected to be hired to not only run the team now but possibly after the sale as well.