Why The 4M Matters


In the most obvious terms, nobody wants to pay someone just to go away.  That’s the obvious reason the money matters.

But, when your business does not show huge revenues, and 4M represents a major impact on your teams bottom line, obviously, from a purely business stand-point, this is a big deal.

Lastly, from a strategic point of view, in realizing return on assets (Heatley), this becomes a very challenging prospect.

Should Ottawa trade Heatley, let’s say to EDM, for the already established deal, they could argue, just on the value of the return, they’ve not received fair value.  Add to this having to absorb 4M dollars, and now trading him, for that package, is no longer a viable option.

So now you have to mitigate for this 4M.

This can be done by;

1. receiving a non monetary return on Heatley exceeding his previously accepted return (the original package) at or near 4M.  ie picks or prospects, or a mutually agreed upon “value” contract (such as Kaberle, who is recognized as under-paid).

or

2. Including with Heatley additional liabilities (player contracts) owed, but not deemed worth a value at or near this 4M dollars.

Both of these scenarios are near impossible for any team to meet, the first due to team depth, the second due to salary cap restrictions.

This effectively leaves Ottawa, under the current rules of the CBA, in an untenable situation, presumable at no fault of their own.

But, if an exception was made, whereby the aquiring team could also reimburse the Senators this 4M advance on a salary they will gain 100% of the benefit of, than suddenly, a viable option exists.

This isn’t to say Heatley will be traded, but without this exception, he will either cause Ottawa immense financial loss, or immense organizational strife.  Again, at no fault of their own.

This, following true to form, is an unprecedented solution, to an unprecedented problem.

GN

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12 Responses to “Why The 4M Matters”

  1. I have no idea how you find the time to write all your posts, but I’m enjoy reading them. Keep it up!

    • Thanks FM,
      I’ve made a conserted effort to heavily cover the draft and FA season. I really appreciate your participation.
      GN

  2. Drive2theNet Says:

    Easily solved. Edmonton just has to send us their #1 draft pick this year (and preferably next year’s too) and we’re good to go. No immediate cap implications for either team, and we can argue we got extra value for Heatley, equal to the $4M we paid. Or as Daly says, Edm can still pony up the $4M.

  3. Billy V. Says:

    Bill Daly said on Sportsnet that Ottawa could pursue a grievence against Heatley and get the 4m back.

  4. Interesting chronology of events.

    Looking more and more like Heatley and his agent played the WRONG cards at the table.

    The GM’s were incened at Heatley, and Dumb and Dummer (his agents), not Murray.

    Facinating game of high stakes poker, and the take, reputation.

    http://mapleleafshotstove.com/index.php/2009/07/01/heatley-sag/

    PS, funny coming from a Leaf’s site, lol.

  5. all I want is for Heatley to leave Ottawa NOW and for this not to go to court. Can we move on already, does he really think he can walk back here in Ottawa and be welcome. If I was him right now I’d run to the first place offered to me

  6. dan carlson Says:

    couldn’t edmonton restructure penner’s contract to make his 4M payable now? penner could be paid by edmonton, then do the swap as planned. everyone’s happy.

  7. Master of Puppets Says:

    Add MPS (10th pick 2009) and take Jason Smith with Heatley. Use the cap $ to sign Tanguay to a 4 or 4.5 M a year for a couple years. Not much left on the FA market of significance. Who are we kidding? Heatley stays in Ottawa unless Sharks or Kings step up and make Heatleys day.

  8. Yeah, I don’t see EDM being the team Heater goes to, unless it he really accepts it’s down to OTT or EDM.
    Otherwise, he’s just going to remain convinced Murray is keepinghim from his rightful place in hockey super-stardom.
    GN

  9. Pleasee, anything BUT Heatley coming back to Ottawa

  10. Woozle man Says:

    Pierre Lebrun’s article makes for interesting reading, and pretty much fingers J.P Barry as the main culprit in this god awful soap opera:

    http://sports.espn.go.com/nhl/columns/story?columnist=lebrun_pierre&id=4302680

    Some choice Barry quotes:

    “Bryan insists that he never really had any other options, which I completely disagree with,” Barry told ESPN.com on Thursday from Stockholm, where he went to broker the Sedin twins’ deals. “I believe there were several potential options. I think it was clearly their intent to trade him to Edmonton and only Edmonton. That was the approach they took.”

    Based on what? Revenge? The most amateur of agents would know that a GM will try to maximize his team’s return in any trade. Considering only one team makes no sense. This is clearly misdirection. What he meant was: we wanted to hold out until Bryan Murray accepted an offer to a team Heatley wanted to go to.

    “I specifically told him two days ago, long before the trade happened, ‘Do not trade him to Edmonton until you have other options.’ And he turned around and consummated the trade despite my request. The result of which is that I get a phone call from a guy that I really respect in Steve Tambellini, who was excited, and I had to inform him what happened.”

    “I think it was completely mishandled by [Murray]. It was a pressure tactic. He loaded up the gun and put the gun against our heads.”

    “Based on my understanding of the discussions that took place with the Rangers, the options the Rangers provided were every bit as good, or better, than the options provided by Edmonton,” Barry said. “But I’m sure Bryan has a different opinion of that.”

    “We advised Bryan continually that Dany requires more than one option [team] to make a decision and, as of last night, we still only had one option, so he still wasn’t able to make a decision, given that there still was only one option in front of him,” Barry said.

    A Rangers source said Thursday the team did make “a competitive offer,” although a Senators source insists it wasn’t as good as Edmonton’s three-player package, saying, “We couldn’t even get a 13-goal scorer in the deal.”

    This is telling. Dubinsky scored 13 goals last year, so neither he nor Callahan was involved. God, it must have been a really crappy deal.

    Given what we know about the offers made, and the info in Lebrun’s article, J.P Barry looks REALLY bad. It is also a strong argument against offering a blanket NMC to anyone. The Sens were clearly motivated to make a trade to avoid making the 4M payment, as long as they got something good in return. Why would Bryan Murray withhold any offers that made sense for the Senators? Barry clearly did not know what the other offers were, and is vastly inflating the Rangers offer.

    While he might argue that he was just acting in his client’s best interests, by not seeing this current acrimonious stalemate as a potential (even likely) outcome, I think he’s really screwed his client’s career. Heatley should fire him.

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