Wednesday, March 16, 2011

March 16, 2011 Dave Checketts comments

ST. LOUIS -- So it has come to this: Dave Checketts, his partnership group (Sports Capital Partners Worldwide) and TowerBrook Capital Partners could not come to a viable solution for Checketts, SCP and new investors to buy up TowerBrook's majority shares of the Blues, Scottrade Center and the AHL's Peoria Rivermen.

So on Wednesday, Checketts announced he and his group are no longer buyers but are now sellers and the Blues franchise is up for sale.

Here are Checketts' comments, conducted via conference call Wednesday night:

This is a story that has gone on longer than anyone would have liked it to. Now it takes an important turn as of tonight.

"We have tried putting together a group, which includes local investors, as well as others with the intention of buying out TowerBrook Capital Partners. This has been going on for months and the last two months having raised the money that I needed, we began negotiations in earnest with TowerBrook and we have been unable to come to an agreement with them on terms that they will accept.

Therefore, we have agreed with our long-term partner, which has been so supportive of what we've done in St. Louis ... they're really outstanding partners in every way, we have agreed with them to put the Blues up for sale, and we have retained Game Plan LLC (out of Boston) to conduct a search for a new owner.

This is a difficult, personal decision for me because we've all come to love this team, my family and I, we love the city of St. Louis and we are especially grateful to the fans who have been just terrific. I could not have asked for better from the fans of St. Louis. But now, we look forward to finding a buyer that shares the same passion that we've had, and the same commitment. There's no timetable in this process. But I felt it was important to go public that I am no longer a buyer of the franchise but in fact a seller alongside TowerBrook. The Blues franchise and arena are all for sale as of this moment. I will not try and stay in. It will be open to a new buyer.

I just want to make sure that I identify and put it in the hands of someone who will care about it and be passionate about it. I look forward to that process.

When did you come to this decision? What are the primary factors leading you to make this decision?
Only one factor. The franchise is in really good shape, much better shape than it was when we came along five years ago. we've sold out every night, the fans really care about it, they're back. We’ve had some very difficult luck this year after starting 9-1 and even coming out of the All-Star break the way we did, we just have not been able to compete the way I'd like. This decision was made towards the end of last week and over the weekend, and lots of conversation with our partners (at) TowerBrook.

Claimed in December, 95 percent done w/new investor group, what happened after that?
It's pretty simple. This is where I've been for the last couple months is trying to make a deal with TowerBrook, our partners. It couldn't happen. It's just very difficult when there are differences and opinions in terms that we couldn't live with, our new investors couldn't live with and our old ones couldn't live with. As a result, just out of respect for them and frankly because we had told them this is what we'd do if we couldn't make a deal, I now have to turn and put the franchise up for sale.

Do you worry that you will be in the same position 2-3 months from now? Do you have an idea of a potential buyer already?
I actually don't have any ideas about buyers. We've received no credible offers at all for the franchise since we've started this process. The only thing that's happened is I've found a lot of good people that were willing to join me and back me to buy the team. But the reality is we couldn't make a deal with TowerBrook. ... I don't expect to be in any different position in two or three months. I really care very much about this team and I'm going to keep pushing this team forward because we have a lot to be proud of. We have a season ticket base of over 11,000 tickets. We have sold out pretty much every game this year, the fans are back, the sponsors have rallied around us, the Opera House is under construction ... all the things that we set out to do. With the exception of carrying the Cup down Market, we have achieved or were in the process of achieving. I could not be more proud of the management team here or the way they're performing. This is a very good NHL franchise ... very good. It's not losing money anymore. It was losing barrels of money when we bought it. It is not losing money. I'm going to keep pushing them forward just the way that I have been until we find a new buyer. There's no timeframe for that. I don't know how long this will take.

TowerBrook wanting to stay in for a smaller percentage?
That's correct. That is why we're doing this.

Offer made by another group here. Response?
I stand by what I said that we have received no credible offer for the franchise.

What would the situation be regarding John Davidson, Mike McCarthy and any other management personnel that might have a contract that's expiring?
We're going to address each of those matters. I think we'll have something to say about them perhaps a little bit later. For now, those guys are all in place. They're doing a great job ... all of them. I expect them to remain in place during the sale process. If I were an owner coming in, I would look at this management team and what they've accomplished and say, 'They've got to stay.' But obviously, that will be up to a new buyer. For now, they are in place and I expect that any buyer would be wise to keep them.

Was problem TowerBrook or finding investors with more money?
No, it was not a problem with that. That was not the issue. This is simply a legacy group of investors who believed that we've made the franchise a significant amount of money and they want out at that price. It's that simple. There's nothing else here. That group of new investors, with the economy and everything else ... we just couldn't agree on the terms.

The NHL getting involved with teams and sales. Have you had any communication with the league regarding helping you out?
No, we don't see that being necessary at all. However, we have a long-term relationship with the NHL. I've known Gary personally for 25 years and he has been kept up to speed on all of this. The NHL will not have to worry about the St. Louis Blues. It is operating well, it has cash, it has resources and it can operate not only responsibly but very well moving forward. It's a good franchise and it's in good shape.

Sell to keep in STL?
Absolutely, in every way, both of us. This team belongs in St. Louis. That's not even on the table, it's not a question.

Will game plan sell SCP/TPC shares together or separate?
We're the general partner, the managing partner. Between TowerBrook and us, we control 90 percent of the franchise. The franchise is for sale. Period. All of it.

If new owner asked you to stay on, would you?
I've got to be clear, I'm not staying on for a new ownership group. When I left MSG, I said I wasn't going to work for anyone ever again ... I was going to be an owner ... and that's what I want to be. Now we just have to make it clear to anyone, if they're coming in to buy the Blues and they want control, they can get it.

Tough to come to realization that you're selling?
Without a doubt.

What were the hurdles that couldn't make it happen for you?
It's a worthwhile question, but it's not one I'm going to address. These were business negotiations, business discussions between new investors and old investors. We weren't able to make a deal. I don't want to get any more specific than that.

Do you think Blues is a viable business?
There is no doubt. We're right on the cusp of a new NHL television deal. Commissioner (Gary Bettman) has done a wonderful job in building revenues at the league level, the Winter Classics ... the game has its issues just like every sport. For now, we've got relative labor peace when it seems like everybody else is at war. It's a really good time to be the owner of the St. Louis Blues and I think someone will want to take that role.

Where do things stand with JD?
We still plan on proceeding down that road because ... out of my loyalty and allegiance to the guys ...but you know when you sell a package to someone, it really is up to them. I'll be as loyal and keep this management team as firmly in place as I can, considering the circumstances.

Once sale is complete, do you have desire to own another pro team?
We have a little major league team in Salt Lake, called Real Salt Lake, who's quite a successful story in major league soccer, very proud of them. We built a stadium for them. It's all gone well. But I'm going to get this done and we'll see from there. I'm not looking any particular direction. We're going to be focused on the St. Louis Blues until that owner gets in place. Then I'll just have to maybe take a little rest and look around. We'll see.

Any possibility that you would sell team separate from building/opera house?
The opera house is a separate entity. We have a very fine partner in the opera house. It's on time, it's on budget, it's going to open to, I think amazing acclaim in the fall of this year ... Today's announcement is about the Blues and the Scottrade Center. And also our ownership, we own 100 percent of the Peoria Rivermen, and that will be part of the package as well.

Is St. Louis a viable market as far as making a profit?
This is a franchise that in my opinion has been run very responsibly considering the size of the market and the challenges it presents. Some people would say they built the building too big. There's too many seats. I never saw it that way. I just said, 'Look, let's get 19,000 people in there every night and then there's not too many seats.' So we tried to do our best and we've really done our best. Is St. Louis a viable hockey market? The answer is absolutely. I've been around a lot of teams over the last 25 years and never met more passionate fans. Boy have they treated me well. I have no complaints. They have treated me so well. The fans, even during the worst of times, came up to me and said, 'Hang in there, keep going, we like the direction, we like the kids, we're pulling for you.' Even as recently as a couple of weeks ago, someone approached me in the team store and said, 'we hope you always remain as the front guy for this franchise. I've had a great five years. I want to put it in the hands of people that will protect it and care about it and be passionate about it. And if I can find someone, they're going to have a lot of fun because I think we've done a lot of the hard work. Not all of it, but a lot of the hard work, and this franchise is on a very good path.

Does this have effect on Armstrong helping team?
I don't think it does. We haven't had those conversations in terms of what that means and what the payroll and what the budgets are. We wouldn't have had them at this point in other season either. We've got some games left to play. I expect our guys to play very hard and work hard and do their best the rest of the way. I don't expect anything less and I don't we will get anything less. At that point, after our general manager and our coach does the exit interviews, we'll sit down and talk about the needs of the hockey club are, and we'll develop a plan. Sale or no sale, we're going to keep operating this team the way we have.

And by the way, while I'm on this subject, I just want to say ... those trades that we made at the trade deadline were hockey trades. They made this club better and I don't have any doubt about that. Anybody that suggests otherwise just doesn't know. They were hockey trades brought to me by our hockey people and I said, 'let's go.' Because we were in 12th place, I thought we needed to pursue another direction and that's what they've started. And yet they've kept a very good young nucleus together. We've got to get healthy, we've got to stay healthy. We need some breaks that way. But this is a club that with a tweak here or there ... it's more like the 9-1 (at the start of the season) or the 8-2 after the all-star game than the 2-8 it was in January. So we'll be right back at it next year and sale or no sale, this club is in very good shape. I'm very proud of what we've done.


  1. I like Dave. It's a shame he has to sell, but that's how it goes. Been down this road before, and the Blues have stayed in the Lou. So I feel okay about that at least.

  2. I don't see the Blues leaving myself. If Saskatoon couldn't grab them back in 1983 when they were really serious about relocating and stayed put, I don't see them leaving now. Franchise firmly entrenched in this city.