September 13, 2011
By: John Clark
According to a story in Monday's New York Post, the New Jersey Devils may be skating on some pretty thin ice to begin today’s training camp.
The article alleges that the NHL team is in serious debt and that it missed a Sept. 1 loan payment, potentially giving lenders an opportunity to push the team into bankruptcy.
A source claiming to be familiar with the situation told reporters that the Devils’ financial situation could also impact Newark’s Prudential Center, the team’s four-year-old home arena.
Known to fans as “The Rock,” the arena is operated by the team-owned Devils Arena Entertainment and guarantees the Devils’ loans. As a result, the $375 million building would also face bankruptcy if the team were forced into filing.
The New York Post further alleges the team’s financial situation is being complicated by the fact that its principal owner Jeff Vanderbeek and co-owner Ray Chambers are on the outs. The two each own 47 percent of the franchise, and it’s been reported that Chambers has been trying unsuccessfully to sell his stake in the franchise for the past year.
The Post article suggests disputes between Vanderbeek and the team’s lenders were an additional cause of Devils’ financial trouble. A source told Post reporters some of the lenders are already considering selling their stakes to vulture investors.
The article concluded that the Devils owe a past due loan payment of roughly $100 million, while the Devils Arena Entertainment owes $180 million.
Shortly after learning of the story, the Devil’s business department issued a formal statement to clear the air surrounding the team’s financial situation.
"Today’s NY Post story is inaccurate," the statement read. "The notions that the Devils are facing bankruptcy or that 'the Devils have told their banks to get lost' are patently untrue. The Devils value their relationship with their banks and are confident a refinancing will be completed shortly. As stated previously, ownership is close to finalizing an agreement that would lead to a buyout of Brick City’s share of the company."
The team further reported that season ticket sales are up 130 percent over last year and that last week’s sale of single-game tickets was 260 percent above the same period the previous year.
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