NEW YORK — The NHL is exploring expansion with a second team in Texas.
Commissioner Gary Bettman announced after the Board of Governors meeting on Tuesday that the league has entered a term-sheet agreement with Houston billionaire Dan Friedkin to explore the feasibility of expanding into either Austin or Houston.
The agreed-upon price is $3.5 billion in total, which would cover both the expansion fee (roughly $2 billion) and the cost of building a new arena ($1.5 billion).
“We have been in discussions for the better part of two years with the Friedkin family, principally for the last two years, about Houston as an expansion opportunity,” Bettman said. “But as we continued to focus with them, particularly on the need for a new arena in Houston, the discussions morphed into also a discussion about Austin, which would also need a new building.
“But we are going to work together under the terms, a term sheet that we were able to agree upon, in terms of a framework to consider what makes the most sense moving forward.’’
Bettman said the league has established a six-month period to determine whether to move ahead and, if so, with which market. The six months match up time-wise with the league’s bigger Board of Governors meeting, held every December — where traditionally owners have voted on expansion.
“There was no board vote (today),” Bettman said. “Ultimately, if we’re able to jointly reach a conclusion, at that time it would be subject to a vote of the Board of Governors. That’s something that will unfold over the next six months, give or take.”
Friedkin, CEO of the Friedkin Group (which is run by his family), owns European soccer clubs AS Roma and Everton, among other ventures.
NHL officials are expected to visit both Austin and Houston over the coming months as part of the feasibility reconnaissance.
Does either city have the inside edge?
“That’s part of the process, is to determine what would be best, both for the league and for Dan Friedkin and family,” Bettman said. “Both cities will require a new arena. It may be more feasible in one place than the other. And as we dig a little deeper and do the due diligence, we’ll figure out which makes the most sense.”
Geoff Molson, a member of the owners’ executive committee, was noncommittal after the meeting when asked about the prospect of further expanding into Texas.
“It’s just an exploration at this stage,” the Montreal Canadiens owner said. “To me, we’ll see, we’ll see. I don’t really have an opinion right now.”
Molson said he would like to get more information before forming his opinion.
“For sure, it’s an important decision,” Molson said.
“We had had a pretty extensive discussion with the executive committee, and the executive committee has endorsed the framework and what was and what is the term sheet that we’re going to operate under,” Bettman said. “But beyond that, this will be a work in progress. But we’re excited about the opportunity.”
Bettman said there were also updates in the meeting on where things are in terms of expansion interest from Atlanta and Arizona. But those are more on the back burner for now.
“Neither Arizona nor Atlanta are quite as far along in the process as the Friedkin opportunities,” Bettman said.
The Board of Governors also learned of the Pittsburgh Penguins sale closing with the Hoffman family.
“The reported number subject to closing adjustments is between ($1.7 billion) and ($1.75 billion), give or take,” Bettman said. “Actually, the deal was made a year ago, so based on the valuations at that time, that was consistent with what Sportico and Forbes and CNBC were doing, although at the time and even now, I think it was low. Having said that, it’s nice that the Hoffmanns got a good deal, and it’s nice that Fenway in five years doubled its investment.”
