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Saturday, July 5, 2008

NHL ownership and the meaning of "due diligence"

From Michael Arace of the Columbus Dispatch:

By all appearances, the local franchise is a healthy operation being run by intelligent people. There is a strong sense that a change in fortune will be orchestrated, on the ice and at the box office. At least, it is possible.

In sharp contrast is the league office in New York. At a time when the strong Canadian dollar has helped boost league-wide profits to an unprecedented level, commissioner Gary Bettman has been juggling scandals to the point where his leadership must be called into question.

Bettman is a corporate lawyer of some repute. Yet he has, unfathomably, forgotten the meaning of "due diligence."

Read the entire article here.

The NHL needs to ramp up its due diligence on incoming owners to ensure that scandals, like the ones that have happened recently, don't happen again.

Ballhype: hype it up!

1 comment:

Steve Werier said...

I think Arace is a little harsh on Bettman here.

Del Baggio in Nashville was a minority owner; it's unfortunate he got into financial troubles, but it isn't fatal to that ownership group necessarily and the fact is that due diligence has its limits. Sometimes the economy just hurts people badly and it can't be foreseen.

As for Samueli in Anaheim, again we have an owner who committed misconduct in his corporate capacity following becoming an NHL owner. Here, the problem wasn't that an owner was a bad businessman per se, it's that he was a liar (Samueli was charged with fraud). Maybe in cases like this there's some sort of inquiry that could have put the NHL on notice ahead of time. But presumably, if the guy is still running his company, that means that investor and regulatory scrutiny hasn't come up with any red flags about him and we can't expect the NHL with its limited resources to unearth something greater.

That said...bring back John Ziegler!