At first glance, the Florida Panthers appear to be on the same troubled financial footing as the Phoenix Coyotes circa 2009.
The Panthers’ major creditor is SOF Investments Ltd., to which Panthers majority partner Cliff Viner has pledged the entire franchise plus the two companies that operate the BankAtlantic Center as collateral. This is the same SOF Investments that is owned by computer mogul Michael Dell and that held an $80-million (all currency U.S.) loan on the Coyotes. The loan to the Coyotes played a large role in that team’s bankruptcy, which left the NHL as its owner.
Just as intriguing is the identity of two new creditors – former Toronto Argonauts owners Howard Sokolowski and David Cynamon. They are part of a group of Toronto business people who lent the Panthers $8-million, according to one source, which puts them third in the line of Panthers’ creditors, behind the NHL, which is always first, and SOF.
Sokolowski and Cynamon have long wished to become NHL owners, once kicking the tires on the Tampa Bay Lightning, Atlanta Thrashers and the Coyotes. However, they also had an eye on bringing a second NHL team to the Greater Toronto Area, an idea that is hot again now that the suburb of Markham is proceeding with plans to build a 20,000-seat arena in partnership with Graeme Roustan, chairman of Bauer Performance Sports Ltd., and developer Rudy Bratty.
Both Sokolowski and Cynamon declined interview requests Friday. However, Panthers president Michael Yormark said the pair became involved with the team because they have a passion for hockey in South Florida, where they both have homes, not because of any plans to grab the franchise and move it.
“They developed a strong affinity and passion for the Florida Panthers,” Yormark said. “When this opportunity came about, they saw it as one where they could get involved with a National Hockey League team.”
The Panthers have been looking for investors for years, but Yormark said neither Sokolowski nor Cynamon has any plans to join the ownership group. “I think they’re comfortable where they are today. They watch all our games, e-mail us all the time. They’re just having fun with it.”
Besides, the Panthers, who were knocked out of the playoffs in double overtime of Game 7 Thursday night by the New Jersey Devils, are about to complete their best financial year since they moved into the BankAtlantic Center in 1998. Thanks to making the playoffs for the first time in 12 years, according to Yormark, most revenue streams are up and a 122-per-cent increase in season ticket revenue is projected for next season.
“When you win, people come,” Yormark said. “Anyone who watched the game [Thursday]night on television saw an arena full, people standing and cheering and showing as much passion as any fans in the National Hockey League.
“I can tell you the Florida Panthers are once again relevant.”
Surprisingly, a source familiar with the operations of many NHL teams says the presence of Dell’s company as the Panthers’ major creditor does not mean they are in the same shape as the Coyotes, which are once again in danger of moving. The source said of the league’s current trouble spots – the Coyotes, Devils, St. Louis Blues and the Panthers – the Panthers are in the best financial shape.
This does not mean the team is about to turn a corner after years of losses between $10-million and $20-million despite its arena’s history of profitability from a healthy lineup of other events. But it does mean Viner, whose financial health was the cause of much speculation recently when it was learned he went through an expensive divorce, is not about to throw in the towel like former owner Alan Cohen.
Yormark would not say how much the Panthers owe SOF, saying only the debt “is in the middle” of the range of loans held by the NHL’s 30 clubs.
“Are we where we want to be? No,” said Yormark, although he is optimistic. “Have we begun to scratch the surface? Yes. We can now put to rest the notion hockey can’t survive in South Florida.”