New Jersey Devils owner Jeff Vanderbeek’s financial troubles have been chronicled diligently over the past nine years, but as he looks to close a sale of the team with a little less than two months until the start of the 2013-14 season, the take-home note here is that the team’s sale is nothing more than a result of the owner’s inability to pay back his loans.
While that seems obvious, it’s important to clarify that the Devils’ current situation is not at all a result of the their on-ice performance – similarly to when former Devils owner John McMullen was looking to sell the team in the 90s – as was the case with the Phoenix Coyotes in 2009.
Vanderbeek became a minority owner of the Devils in 2000 then bought the team outright in 2004. The Devils have made the playoffs seven times during Vanderbeek’s time as majority owner and won one of their three Stanley Cups with him as a minority owner in 2003. They moved into their new arena, the Prudential Center, in Newark in 2007 (admittedly with some financial drama), with the help of Vanderbeek’s strong push to make the relocation a reality.
(Andy Marlin/NHLI via Getty Images)
That being said, two key factors in Vanderbeek’s debt woes include the NHL’s 2012-13 season being shortened due to yet another lockout and the NBA’s New Jersey Nets relocating to Brooklyn for the start of their 2012-13 season. Both of these issues resulted in a significant decrease in events and, of course, revenue for the Prudential Center, contributing to the continual reports of trouble in paradise.
New Jersey is not in the same position that the Phoenix was in, though. The Coyotoes hadn’t made the playoffs in six seasons before they declared bankruptcy in 2009 and NHL took over the team. The league ran the Coyotes for four years before an owner was found and during that time, Phoenix finished last or second-to-last in attendance each season.
However, it’s unlikely that the NHL would run the Devils if a new owner isn’t found, as they did with the Coyotes. “I haven’t seen the Forbes report [that stated the league would operate the team], but if the suggestion is we’re going to take over the Devils, which is what I’ve heard the report says, it’s not accurate,” Commissioner Gary Bettman said on Thursday.
(Andy Marlin/NHLI via Getty Images)
It’s looking like the Philadelphia 76ers owner, Joshua Harris, is the frontrunner; his purchase of the New Jersey Devils would encompass all of Vanderbeek’s debt – including a reported $30 million that Vanderbeek borrowed from Andrew Barroway, a Philadelphia-based attorney who was in contention to purchase the franchise – but the Devils current owner is reported to stay on as a minority owner after the sale.
For all intents and purposes for the Devils, though, Vanderbeek selling the team appears to be a good thing. The franchise’s financial problems are solely on the owner and his inability to pay his debts despite a recent loan restructuring, and the hope is that with an owner who has the means to keep the team afloat, the franchise will be as successful off the ice as they are on it.
Rachel Askin
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