It’s August. There isn’t much happening in the hockey world, especially with the Tampa Bay Lightning. One of the drawbacks of covering a well-run franchise is that there is rarely off-season drama to write about in the doldrums of summer. More times than not, nothing happening is boring. Other times, while nothing actually happens, it’s the result of a more chaotic experience. Let’s jump back to August of 2007 when the Lightning were “sold” to a ownership group known as Absolute Hockey Enterprises.
While most of the sporting world was focused on Barry Bonds and his pursuit of baseball’s all-time home run record, things were going on behind the scenes at 401 Channelside Drive. Big things. The Bolts were coming off of a season where they had finished second in the Southeast Division (RIP) to the surprising Atlanta Threshers (also RIP). Their 93 points was good enough for the seventh spot in the Eastern Conference and a first round match-up with the New Jersey Devils. The series went six games, with the Lightning bowing out with a 3-2 loss on home ice as Brian Gionta scored the series winner with just under six minutes to go in the second period.
Goaltending, split between Marc Denis and Johan Holmqvist, was inconsistent, a problem that wasn’t addressed in the off-season. Honestly, not much was really addressed in the offseason.. They re-acquired Chris Gratton for the eleventy billionth time, lost Cory Sarich and Ruslan Fedotenko to free agency while signing Michel Ouellet, Craig MacDonald, Brad Lukowich, and Mathieu Darche. They didn’t have a first round pick (having traded it to Anaheim for the services of Shane O’Brien), but in the third round drafted a kid from Deerfield Academy that was committed to Harvard by the name of Alex Killorn.
By the time August rolled around fans weren’t super-excited about the upcoming season (especially since the Bolts had about $5 million in cap space to play with) but they weren’t super-grumpy about things either. The Big Three were still there and producing as Vinny Lecavalier (108) and Marty St. Louis (102) hit the century mark in points while Brad Richards had 25 goals. Holmqvist had a decent season with 27 wins and a 2.85 GAA while Denis was still young enough that you could convince yourself he could improve and lock down the number one role. Honestly, the most exciting news was the rumor that the new logo for the team would be rolled out at IceFest at the end of the month.
Off the ice, there were things a-brewin’, though. During the Stanley Cup Final between the Anaheim Ducks and Ottawa Senators, two friends in South Florida were watching and decided that it would be super fun to own a NHL team. One of those friends, Doug MacLean, had hockey experience having just recently been relieved of his duties as the general manager and head coach of the Columbus Blue Jackets. The other friend, Jeff Sherrin, wasn’t a “hockey” guy, but had made some money developing property.
The day after the Ducks skated away with the Cup, Sherrin made a call to a financial consultant, Sal Galatioto, who had connections in the sports franchise world. As Florida residents, the Lightning were one of the teams Sherrin and MacLean were interested in buying. The only problem, they weren’t currently for sale.
By all indications, Palace Sports & Entertainment was begrudgingly happy with the Lightning. Sure, they grumbled about losing money on the franchise every year (except for the Stanley Cup season of 2003-04 when they claimed to make about $3.5 million), and they weren’t happy with the lease on the St. Pete Times Forum. Those are typical ownership complaints though. Having bought them for less than $100 million in 1999, and valued at $172 million by Forbes in 2006, things were at least stable.
In some ways, William Davidson was an ideal owner. For one thing, he was a real person. Normally, that’s not a big deal, but with the Lightning’s ownership history (Takashi Okubo), it’s always nice to know that there is an actual person to go along with the name. Second, he stayed out of the way. Again, looking at the Lightning’s history (Art Williams), that’s a good thing.
However, he was also in his 80s and was never really a hockey guy. Since he rarely left the Detroit area and his beloved Detroit Pistons, it always seemed that the Lightning played second fiddle in Davidson’s sports empire. Despite telling Galatioto no on the initial call, it seemed there was at least a little interest in a potential sale, as long as it went to the right buyers.
By August 3rd, it seems that PS&E had found the right buyers as they agreed in principle to sell the team to Absolute Hockey Enterprises, a group consisting of Sherrin, MacLean, and a Hollywood guy who had played a little junior hockey, Oren Koules.
On August 7th, the same day Bonds would “stand alone” as the all-time home run leader, the Lightning shocked the local sports world by announcing that PS&E had entered into a purchase agreement to sell the team to Absolute Hockey for “around $200 million”. We would all soon learn that a purchase agreement isn’t the same as a signed and sealed deal.
The deal came together so fast and so quietly that a lot of members of the Lightning didn’t know anything about it. We’re not talking about the janitor and Zamboni driver. Ron Campbell, the team president, and Tom Wilson, the team governor and chairman, weren’t aware of the transaction until after it was a done deal. Experts in the sports world were taken aback a bit at how fast things had come together, and there was talk that things could be buttoned up in time for the league’s upcoming board of governors meeting scheduled for the end of September.
The vibes about the sale seemed good. MacLean, who assumed the role of spokesman of the ownership group, assured everyone that not only would the team stay in the Tampa area, the owners would also be locating to the area with MacLean telling reporters, “Absolute zero thought of that [moving the team].” Koules stated that, “this won’t be a toy for us, this is our job.” ^
MacLean was quick to compliment the hockey structure of the team, indicating that head coach John Tortorella and general manager Jay Feaster would keep their jobs. MacLean, the former general manager of Columbus, stated that, while he would be involved in the discussions around hockey decisions, Feaster would have the final say.
From the players to the executive management, the news was greeted with optimism, with the players thanking Mr. Davidson for turning the team into a contender, but also mentioning that local ownership would be nice. Tortorella and Feaster both liked the idea of having an owner that was easier to access instead of going through an extra layer of management (i.e. Tom Wilson). During a question and answer session at the team’s August Icefest, Tortorella, in his typical blunt fashing, let his feelings toward Wilson be known,
“The guy I’m glad is the hell out of here is Tom Wilson because he’s the one who has put obstacle after obstacle in front of us. Who knows? This deal might not go through, and they’d still be her. I really don’t care.” *
There wasn’t a huge sense of urgency as training camp opened up and the players started trickling in to get ready for the 2007-08 season. The prospective owners had their happy, optimistic faces on as they assured everyone that the first step of the application process, where the financials are shared and everyone has the money that they say they have, was moving along swimmingly. The deadline between PS&E and Absolute Hockey to have everything wrapped up by the end of December seemed far away.
During this time, the names of other potential owners started to trickle out. The first was film producer Mark Burg. Tampa attorney Steve Burton was soon revealed as the fifth member of the ownership group that would be responsible for 80% of the money needed to buy the team with a small consortium of other investments providing the rest. By league rules, no more than 50% of the purchase price could be financed, so Absolute Hockey had to round up at least $100 million in cash.
By October, there had been no public movement on the purchase, but fans were assured everything was good to go and according to MacLean, the NHL had begun their own due diligence (they had learned something from the John Spano debacle). Cool. Unfortunately, according to the league, aka Gary Bettman, that wasn’t true. The league was, in fact, still waiting on some “paperwork” from Absolute Hockey.
Remember that board of governors meeting set for the end of September? Well, they blew by that date without completing the necessary prep work to put if before them, but were pretty confident they could get in on the agenda for the November meeting and have everything wrapped up by December. Heck, if needed, they could get things approved by fax. So, why worry?
As the calendar rolled into November, the drama ratched it up two or three notches. Word leaked out that there was a little infighting among the prospective owners. It wasn’t just a minor squabble about who gets the biggest office either. We’re talking about a full blown lawsuit. Sherrin and MacLean dropped a lawsuit alleging that Oren Koules didn’t provide his portion ($4.1 million) of the $ 5 million that was due on November 12th as part of the purchase agreement with PS&E.
It wasn’t like Koules didn’t have the money. It seems the original terms of the agreement had changed among the principle partners. Originally Koules would provide $40 million. That number was increased to $50 million and Koules demanded his ownership stake go from 30% to 70%. Which, seemingly they agreed to, but despite having that much of a stake, Koules wouldn’t have a say on how the team would be run.
Sherrin and MacLean also claimed that Koules was going behind their back, and using information gleaned from the financial meetings to put his own ownership group together and steal the team out from under them. That’s not cool. With the two sides squabbling (and missing the payment due date) PS&E terminated the sales agreement from August.
After spending the last few months making the rounds in the press, MacLean went radio silent in November and December as the original deal fell apart. Early in December, the two factions met at the league’s offices and an agreement was worked out by the commissioner. He is, at heart, still a lawyer after all. It was speculated that Koules paid off Sherrin and MacLean with a possible seven-figure settlement and the lawsuit was dropped.
Despite nixing the original sales agreement, PS&E didn’t take the team off the market. The original group that had comprised Absolute Hockey splintered with Sherrin, MacLean, and Burton scrambling to find more investors. Koules meanwhile, formed the O.K. Hockey LLC and proceeded to launch a separate bid to purchase the team. A bid that was eventually granted an exclusive negotiating window when it became apparent that they were a little better at raising money to buy the team.
The negotiations dragged on throughout the winter until it was finally announced on February 13 that O.K. Hockey would indeed be the group that purchased the Lightning. That process would become a fiasco in and of itself as Koules tried to secure the funding for the team in the midst of a financial crisis. However, that’s a story for another day. Ten months after the sale of the team was first announced, it was finally completed with Oren Koules and his partners the proud owners of a hockey team. His original partners, Sherrin and MacLean, were left out in the rain with nothing.
While the drama of the sales process (not to mention whole O.K. Hockey ownership experience) made for some interesting reporting, there is something to be said for the calm and steady (some might say boring) hand of Jeff Vinik and his ownership group.
^ “Bolt from the blue” St. Petersburg Times, August 8, 2007, retrieved via newspapers.com on August 19, 2023
*”Tortorella rips outgoing CEO” St. Petersburg Times, August 26, 2007, retrieved via newspapers.com on August 19, 2023
