The $56.3 Million Question: How To Keep The Big 3 Intact? (Part 2/2)

Back in WW II, there was a saying, “Loose lips sink ships.” Did Head Coach Barry Trotz‘s ‘Match Statement’ damage David Poile’s efforts to get an affordable long-term deal done with Shea Weber prior to arbitration? Was it a slip of the tongue or a statement spoken out of foreknowledge as to the extent of the Predators Ownership Group’s commitment to signing the Preds’ Big 3? (Photo: Courtesy, Nashville Predators)


The Die is Cast

General Manager David Poile cleared the decks of nearly all unnecessary salary — including a few hard choices he had to make along the way — all in the effort to make it possible to sign this key trio of players. In the absence of a long-term deal, it’s not likely that the Preds feel too that bad about Weber’s one year, at $7.5 million; Poile went so far as to admit he deserved it. However, if Ryan Suter insists on even a long-term deal at equal value, particularly if he’s looking for a front-loaded contract as we believe Weber did, there could be some real problems for the Preds.

Less of a concern, but still a possibility is the further complication of a big payday request by goalie Pekka Rinne. After a second-place finish in the Vezina Trophy race, Peks could well command a deal in the $6 million per season range. The hope is that he will not, given that the big dollar comparables are way down in the area of goaltenders in recent years (that is, for guys not named Bryzgalov, signed by nutzoid teams not called the Philadelphia Flyers).

If Pekka has the patience and desire to remain in Nashville and to keep his demands reasonable and if Suter is willing to do the same, they both could be signed before the season begins. However, if as a result of the Weber arbitration debacle, the other two now have dollar signs in their eyes, then there’s no reasonable expectation to keep any of them, long-term. The urban legend then becomes reality and the Predators officially become the Montreal Expos of hockey, i.e.: the chief player development team for the rest of the league. This could become a repeating cycle.

So what’s a verklempt hockey fan in Music City to do? It’s tough to say, but we can certainly start by expecting ownership to do what they have always done without fanfare or compromising their principles — well, not all of them, anyway.

Spend some damn money.

That’s right. Sometimes ya just gotta do what’cha gotta do.

Equal Value? Puhleeze.
The Preds can trade Weber, but they will never recieve equal value in return. Even though the bounty of draft picks afforded by an offer sheet on the Captain might be able to land an eventual replacement, it would be years before that player’s talent on the ice could be fully utilized. It certainly would not be in the short term, i.e., the Preds current ‘window of opportunity’ period that Poile has pronounced the team to be in.

And let’s be real; even in the long term we aren’t likely to see another player of Weber’s generational caliber falling into the team’s lap even from multiple first-round draft picks of likely offer sheet suitors Detroit or Vancouver, neither of which promise to be lottery teams any decade soon.

Reality states that the only teams who might be able to afford, either to offer-sheet or trade for Weber will generate the least in draft pick value due to their typical back-of-the-first-round draft positions. In terms of possible trade partners, the good teams just aren’t going to give up good players when they know they can buy one instead.

In terms of really getting much for Weber, the Preds are already screwed. I’m sorry, but any talk about receiving ‘fair value’ in trade for Weber is pie in the sky, in my opinion.

The Preds would need at least one top goal scorer in return to make any positive impact as a win-win proposition in dealing the Captain. However, in the current NHL, history says that teams don’t jettison proven, top goal scorers unless that player has some kind of issue. Recent examples include Chris Carter, Mike Richards, and Dany Heatley, all of whom had personality and/or discipline issues with their former teams. Their trades were as much about a parting of the ways with their former employers as they were about satisfying any real need for their team in exchange.

That brings us back to the question; the $56.3 million question of whether or not to bite the bullet and spend the money needed to secure not only Weber, but Suter and Rinne going forward. Can the Preds ownership do it? Can this group of weathy-but-not-stinking-rich business folks come up with the cash without risking their collective livelihood?

Probably not, but they have to; for now, anyway.

Although the team faces nine RFA deals (including Weber’s) that must be addressed for 2012-13, along with five UFAs (including Suter and Rinne), there is relief on the horizon. The two longest and most costly contracts in team history, those of David Legwand and Martin Erat, each packing a hefty $4.5 million cap punch apiece, are due to expire in 2014-15 and 2015-16, respectively. Neither player may see that kind of money from the Preds or anyone else again.

That means if Poile could work out back-loaded deals for Suter and Rinne at least, while convincing Weber to accept an even-handed-but-cap-friendly extension for the same term, the Big 3 could play together late into the decade. And who knows where the team’s success and Nashville’s continued growth as a destination city might take it financially by then? Perhaps at that point the need for receiving revenue-sharing will be moot.

One can only hope. And while you may believe that idea is pie in the sky as well, it’s much more likely to happen than the Predators receiving any 40-50 goal scorers in trade from anyone or for anyone.

But Can They Do It?
As mentioned earlier, there’s really not a lot that a person of average intel sources like yours truly can do to discern what the exact financial wherewithal of the Nashville Nine might be (and thank gawd for that! I don’t know that I’d like anyone poking their beak in my financial biz either). However, in doing whatever diligence I could, there are some interesting facts we might consider regarding what might be possible.

Preds Investor group member Warren Woo is pretty much a non-factor for a couple of reasons. He’s not local; he’s an investment banker in L.A. and, came to be involved with the Preds via his former relationship with Boots Del Biaggio. The good news is, apparently he was not privy to Boots’ scam tactics and the fact that he still holds a (presumably small) stake in the team indicates that the other owners trust him. Nonetheless, it’s highly unlikely he would be offered the opportunity to take a larger stake in the team than he already has.

That leaves the locals for us to consider, or as I like to call em, The Nashville Nine.

Tom Cigarran is co-founder and current chairman of Nashville-based healthcare corporation, Healthways, Inc. Not a bad gig to be sure. He also has a sizable interest in an ambulatory surgical company called Amsurg Corporation (outpatient surgical facilities). But when you consider that according to Forbes Magazine’s sketchy (and inconsistent) reports, Cigarran’s combined compensation (up to the latest year listed, 2009) has averaged ‘only’ about $340,000 annually, he’s making well less than the NHL player minimum salary (which was $500,000 as of last season). Granted, of course, those are old numbers, but if you looked at Healthways’ stock price history over the past year, it’s fairly obvious that Cigarran isn’t exactly killin’ it at the moment.

Tom’s son, Chris Cigarran is also listed in the ownership group. He’s Healthways’ Human Resources Senior Vice President. Again, I’d love to have his paycheck, but in no way could he be considered super-rich.

Herb Fritch is yet another among the Preds ownership ranks who’s professional specialty is the healthcare business. As founder and current CEO of managed-care corporation, HealthSpring, Inc., Mr. Fritch would appear to be doing fairly well, financially, and the company stock price is holding steady.

The Dobberpuhls, Joel and Holly, continue the theme of family among Predators owners. Joel is the founder, CEO, and portfolio manager of global hedge fund, Jetstream Capital, LLC., located in Brentwood, TN. His company manages a portfolio of a reported $550 million in assets.

Joel’s wife, Holly Dobberpuhl is a board member of a therapeutic horse-riding facility in Franklin, TN.

Likewise, brothers, DeWitt Thompson V and John Thompson serve as President and Marketing Director, respectively, for the Nashville-based heavy-equipment company, Thompson Machinery. As company President, DeWitt is the fourth generation namesake of his great grandfather’s original business, now boasting eleven locations that comprise its two primary divisions throughout Tennessee and Mississippi.

And although I’m sure that both DeWitt V and John pull down some serious coin, fact is, their Pop, DeWitt Thompson IV is still sitting in the big chair as company CEO.

So, upward mobility? No doubt. Independent wealth? I wouldn’t bet on it.

Out of all the Predators ownership group, only majority investor David Freeman is clearly what you’d call ‘up there’ in terms of personal wealth; chiefly by virtue of the publicly-verified upwards of $94 million he’s already invested in the team. Freeman and fellow member Joel Dobberpuhl are good at making money for other people; and in turn no doubt make a lot for themselves. They could be considered the wild cards among the ownership group; the ones who could conceivably make things happen should the team wish to take the bold step required to keep the Big 3 together. In terms of Freeman, his act in forming the ownership group in 2007 was not only bold, it was huge.

Trotz’s Loose Lips Deux
There’s a reason I’ve yammered on so long about the ownership group and their financial wherewithal (or lack thereof). Much of my argument here is based on something I’ve presented before but now believe to be even more germane to the conversation at hand than it was when it first occurred to me a week ago.

It’s the persistent gnawing in the back of my mind regarding the timing of Barry Trotz’s now-infamous pronouncement that Shea Weber was offer sheet-proof. Trotz publicly insisted that the Preds would match any offer sheet coming from another team should Weber become eligible to receive one, i.e.: if he wasn’t re-signed prior to July 1st. Well we all know what happened. Poile wanted to buy some time while avoiding the headache and the potential for such an uncomfortable distraction by electing to take Weber to arbitration, thus shielding him from any offer sheet overtures and no doubt believed that such a move would do nothing to make the process more difficult.

But guess what? The process was infinitely more difficult.

The question I have is, why?

Why did Weber suddenly fire his previous agent, Don Meehan in favor of Jarrett Bousquet and Titan Sports Management just a few weeks after Trotz made his ‘match’ statement? Was it in response to this sudden notion that money was no object to the Predators in retaining him? Did his old buddies at Titan convince him that now was the time to act and perhaps go for an even bigger payday than expected? What other reason could Weber have possibly had for being characterized as ‘angered’, as was reported when he learned that the chance of receiving an offer sheet had been eliminated by Poile’s action of taking the matter to team-elected arbitration?

Unless he eventually leaves the team, we may never know all the conflicting permutations of Weber’s apparent change of direction, from the weeks prior to his contract negotiation through the subsequent salary arbitration hearing. However, we’re much more likely to soon find out if Barry Trotz’s pronouncement was idle, perhaps ill-timed bravado, or a true glimpse into a decision already made by the Preds ownership group; that is, to open the saddlebags for Weber, which could likewise signal a willingness to do so for Suter and Rinne as well in the coming months.

It’s not that far-fetched. In light of Cigarran and the rest of the Predators’ management and operations staff’s promotion of this ‘window of opportunity’ that the team now believes itself now to be in the midst of, surely the owners realize that the time — if ever there was one — is now to push the envelope to finance that effort.

I personally find it hard to believe that Trotz’s statement was made in a vacuum. It would be inconsistent with the Coach’s longstanding profile as a Predators employee and public figure to offer any statement — particularly one of such gravity — if there wasn’t considerable truth behind it. Nonetheless, that being said, should he have made the statement? Probably not.

It’s pretty clear that Trotz’s casual pronouncement became problematic at best, and at worst, may well have placed Poile in a position of far less strength than he first believed he would have, both in the Weber negotiation and the ones yet to come for Suter and Rinne.

It will soon be apparent whether or not the willingness exists to establish ground where this ownership group has never before tread, salary-wise; and moreover, how that decision will affect the aperture of the Predators’ window of opportunity, which appeared to be so gaping just three brief months ago.

 

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finis

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