If you believe Wikipedia, the St. Louis Blues are the only North American professional sports franchise (of the major sports) owned (at least partially) by a private equity firm. That trivia nuggets day’s are now numbered.
Confirmed by multiple sources (here and here), TowerBrook Capital Partners, L.P. is divesting their interest in the St. Louis Blues. They have been a part of the ownership group with Dave Checketts’ SCP Worldwide since the purchase of the franchise from the Laurie family in 2006.
With the highly publicized messes in Phoenix, Tampa and on Long Island, Blues fans have probable cause to be worried. The franchise has not been on the sturdiest of ground financially and losing a vital member in the ownership group doesn’t help. Especially when that member has the majority of the money. Add in a slow economy in a mid-sized market and Ken Campbell’s recent Hockey News blog… people can start to make logical connections to an unpleasant result.
For now those fears will have to be pushed a side. Doom and gloom need not apply here. Not because I am a “glass half full” type of guy. More so because there is no indication that SCP (the managing partner) is pulling anchor and leaving port, regardless of Campbell’s forcasting. In a press release quoted by the St. Louis Post Dispatch/STLToday.com, a SCP spokesperson says,
“We knew at the outset that our private equity partners at TowerBrook had defined investment and operational objectives, which have now been reached. Therefore, we at SCP have retained the sports agency group at Citibank to help us find new investment partners to join us and Stillman as we continue to remain committed to the City of St. Louis and the St. Louis Blues organization.”
TowerBrook has reached their investment objectives and fulfilled their exit criteria. Not an uncommon practice in the business world. According to Sports Business Daily, equity firms like TowerBrook are looking for short term investments. The initial shock is warranted. Prolonged fears premature at this time.
According to Andy Strickland SCP sources say this will not effect Dave Checkett’s ability to run the Blues financially. Whether or not that holds true remains to be seen. However, the situation is not likely to hinder the Blues ability to retain their key young players this summer. The needed funds to operate in the short are not the concern. The potential problems come further down the road. The SCP spokesperson declined to comment on TowerBrook’s stake in the Blues and advised there is no time table for finding a replacement investor. Not much to go on other than to speculate that if the void lingers there will be tough financial choices facing SCP. They can’t go it alone long term. A new partner must be found.
Looking at the other NHL ownership issues and even the St. Louis Rams own troubles securing new ownership the Blues face an up hill battle. For now those legitimate concerns need to go on hold. It’s just far too early in the process to make any reasonable conclusions on the end result.
Filed Under: St. Louis Blues
About the Author: Bleeding Blue from the IL side of the Mississippi, I've been a Blues fan since I can remember seeing the Blues take on the Oilers at the Arena when I was about 5. All I remember is that Brett Hull scored and I was hooked. Now I cheer on the likes of David Backes and TJ Oshie. It's a great time to be a Blues fan as this team rebuilds itself.