NHLNov 3, 2016 by Jacob Messing
Parent Company of Bauer Hockey Files for Bankruptcy
Parent Company of Bauer Hockey Files for Bankruptcy
Performance Sports Group Ltd., the parent company of Bauer hockey, filed for bankruptcy on Monday.
Performance Sports Group Ltd., the parent company of Bauer hockey, filed for bankruptcy on Monday.
According to a lawsuit against PSG, the company used a practice called “channel stuffing,” which falsified revenue to cover up the company’s true financial standing and front-loaded revenue reports with pressurized sales.
Through the filing of Chapter 11 bankruptcy, PSG facilitated the restructuring and sale of its assets, which it listed between $500 million and $1 billion.
PSG primary shareholder Sagard Capital, and Fairfax Holdings purchased the company’s assets for $575 million in a “stalking horse” bid.
Headquartered in Exeter, New Hampshire, PSG said it does not expect business interruptions during the bankruptcy process.
The bankruptcy process has left one entity up in the air: player endorsement deals.
Bauer backs some of the biggest names in hockey, including Alex Ovechkin, Patrick Kane and Jonathan Toews, who each which have a deal that's worth between $300,000 and $500,000 annually.
The three players highlight more than 170 athletes Bauer endorses, which also includes their newest client, rookie Auston Matthews, who was signed to a $200,000 deal prior to the 2016-17 season.
Should it be taken to court, and should Bauer receive a favorable ruling, a judge could determine the company doesn’t have the means to uphold their end of these contracts and could simply cancel all endorsement deals.
These deals are significant not just to players, but their agents, as well. Some agents receive as much as 40 percent for negotiating deals between their clients and a company. Imagine a player is signed to a deal that pays him $500,000 annually; his agent could be receiving upwards of $200,000 from that deal alone.
Agents also don’t have the stability players do in million-dollar contracts signed with their respective NHL clubs. Now imagine that agent represents several Bauer endorsees.
Don Meehan is one of those agents. He represents a handful of Bauer endorsees, including Steven Stamkos and Jordan Eberle. But Meehan did say that Bauer executive Jim Geary informed him that even through recent issues, business would continue as normal.
According to a lawsuit against PSG, the company used a practice called “channel stuffing,” which falsified revenue to cover up the company’s true financial standing and front-loaded revenue reports with pressurized sales.
Through the filing of Chapter 11 bankruptcy, PSG facilitated the restructuring and sale of its assets, which it listed between $500 million and $1 billion.
PSG primary shareholder Sagard Capital, and Fairfax Holdings purchased the company’s assets for $575 million in a “stalking horse” bid.
Headquartered in Exeter, New Hampshire, PSG said it does not expect business interruptions during the bankruptcy process.
The bankruptcy process has left one entity up in the air: player endorsement deals.
Bauer backs some of the biggest names in hockey, including Alex Ovechkin, Patrick Kane and Jonathan Toews, who each which have a deal that's worth between $300,000 and $500,000 annually.
The three players highlight more than 170 athletes Bauer endorses, which also includes their newest client, rookie Auston Matthews, who was signed to a $200,000 deal prior to the 2016-17 season.
Should it be taken to court, and should Bauer receive a favorable ruling, a judge could determine the company doesn’t have the means to uphold their end of these contracts and could simply cancel all endorsement deals.
These deals are significant not just to players, but their agents, as well. Some agents receive as much as 40 percent for negotiating deals between their clients and a company. Imagine a player is signed to a deal that pays him $500,000 annually; his agent could be receiving upwards of $200,000 from that deal alone.
Agents also don’t have the stability players do in million-dollar contracts signed with their respective NHL clubs. Now imagine that agent represents several Bauer endorsees.
Don Meehan is one of those agents. He represents a handful of Bauer endorsees, including Steven Stamkos and Jordan Eberle. But Meehan did say that Bauer executive Jim Geary informed him that even through recent issues, business would continue as normal.