Who needs a hockey team? Special purpose acquisition company Sports Properties Acquisition Corp. (AMEX:HMR) does.
According to Tuesday reports from Sports Business Daily and The Globe and Mail, Sports Properties is in talks to acquire the National Hockey League's Florida Panthers. An official at Sports Properties declined comment, and calls to the Panthers were not immediately returned.
Sports Properties, formed in 2008 with a $215 million initial public offering, must make a deal by January 2010 or else it will have to return its funds to shareholders. The potential deal values the Panthers at about $230 million, including debt and the BankAtlantic Center in Sunrise, Fla.
The big question: How much return investment can the Panthers provide to shareholders? It is unclear what its latest financial figures are, but being located in a "nontraditional" hockey market, it is believed the team is in the lower tier of the league in terms of revenues.
Sports Properties has been looking at several options. It made a failed bid for the Chicago Cubs last year, walked away from the Phoenix Coyotes, and now it is also allegedly looking at the Montreal Canadiens. However, Sports Properties faces wider competition in the Canadiens' auction as the team have at least 10 potential buyers looming. Reports surfaced that the Canadiens posted a $45 million profit for the fiscal year ended June 2008, making it one of the most profitable teams in the NHL.
Industry observers have previously indicated that several "nontraditional" NHL teams are facing financial challenges and could be looking for buyers or investors. The Tampa Bay Lightning, Carolina Hurricanes, Atlanta Thrashers and Nashville Predators have been mentioned in the rumor mill. Additionally, Tom Hicks is seeking a minority investor to buy a stake in the Dallas Stars.
Whether Sports Properties will start skating toward the Canadiens or wait in the Florida sun for the Panthers to go up for sale remains to be seen. - Demitri Diakantonis
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