NHRA Sold (1 Viewer)

[d'kid]

First, last year's surprise news about the Countdown. Now, this. At least give NHRA credit for their communication channel security.

Also, if they are intent on developing the asset and raising its profile, does this pave the way to the first million-dollar purse?

I am now cleaning cola off the monitor.... million bucks, yeah, right...

 

[Mr. Jean]

If the NHRA was sold for 121Mil, that's roughly 1x Revenues, which is basically a steal. 3-4 X Revenues would be a little more in line, I would think. Anyone agree? Also how does a public company operate as a not-for-profit organization when being public is all about being FOR profit?

Don't forget that there may be an assumption of debt in this deal. If the property wasn't paid in full, it lowers the asset value. Just my thoughts.....

Don't know how this will turn out, but it's for sure, there'll be some major changes. If it goes through........

 

[robinjackson]

Yes, far-fetched for sure, but people do say it's necessary to bring profile parity with other leading motorsports.

 

[megadeth]

The same "board" is still there for the NHRA just in a different title capacity. It looks like, to me, a little bit of "3 card Monty" for the time being. With the amount of dollars put down, there seems to be a huge marketing plan in the works. I would hope that it means bigger payouts in all catagories (the NHRA made money so now they can pay the sportsman catagories what they are worth!) and the new owners will find more money to pay the pro catagoies decent checks from a boost in advertising. Whatever the connection is with whomever this group is, I pray they will do the right thing and take the sport to the next level as it is well deserved. I have to say again.............ie......Dick Lahaie.............a fresh set of eyes may make all the difference.

As if we don't have enough to deal with! Geeeeeeze!!! 4 weeks off...........the new points system.................and now THIS!!!

I am checking into "Promises Rehab Center"!!!!!!

As long as they don't charge the spectator anymore than they already do!

 

[megadeth]

I find it ironic that Tom Compton and most of the executives still hold on to their high paying jobs and still set policies who ever bartered that deal knows how to sweet talk that's for sure!

Just a few things I like to say if the Pit Access go bye bye then so will I!
I agree with Paul I felt the disturbance too!

Time to pull up a chair and get some pop corn this is going to get interesting!

 

[NHRADeuce]

If the NHRA was sold for 121Mil, that's roughly 1x Revenues, which is basically a steal. 3-4 X Revenues would be a little more in line, I would think. Anyone agree?

Actually, they didn't buy ALL of NHRA so it would not be accurate for them to base the purchase price on the entire revenue of NHRA. HDP also assumed almost $10M in outstanding debt and liability.

Also how does a public company operate as a not-for-profit organization when being public is all about being FOR profit?

There are going to be 2 different companies - NHRA Pro and NHRA. NHRA Pro will be a subsidiary of HDP, NHRA will continue to be a non-profit org.

 

[Cschlik]

I was just thinking of this.... I have no idea how much the physical property of the NHRA is worth. One would hope that this aquisition company would not choose to just sell the property for a profit and walk away.... This would be especially bad if the purchaser had development plans instead of running a racetrack...

I don't recall which tracks they own, it seems to me that they would be worth more than $121 million for their land and development value (especially the ones closer to metro areas).

Just more pointless speculation...

 

[mick]

could this have been financially mandatory? as in the
'professional' side as well as the four tracks were developing revenues
not suited well for 'non-profits'?
could NHRA have seeked out this merger themselves looking to gain
both marketing capital/strategy along with a revised accounting strategy?
if the merger is offered with little to no financial risk, then
both parties pooling their efforts can take an educated guess at
future increased profits?
will be interesting to watch.

 

[Suzie Q]

I was just thinking of this.... I have no idea how much the physical property of the NHRA is worth. One would hope that this aquisition company would not choose to just sell the property for a profit and walk away.... This would be especially bad if the purchaser had development plans instead of running a racetrack...

I don't recall which tracks they own, it seems to me that they would be worth more than $121 million for their land and development value (especially the ones closer to metro areas).

Just more pointless speculation...

The last offer for the Englishtown track was $200,000,000!!!

 

[Gregg Pickens]

As I recall NHRA owned Gainsville, Atlanta, Indy and Columbus. They have a long term lease with the city for Pomona. Usually with a lease the property owner maintains ownership of any improvements made by the leasee. They do not own Englishtown.

 

[Mike Glick]

The sky is falling! The sky is falling!

 

[john]

The last offer for the Englishtown track was $200,000,000!!!

Wasn't that offer debunked by the Knapps after the last round of "E-town is closing!"? I thought they got a good chuckle from that.

 

[stanman]

I'll play the devil's advocate on this one.

I did the math. The last national event had 280 sportsman entries ($70,000). Of that, how much was paid out? How much extra does it cost for the extra employees (parking, registration, staging lanes, etc.) needed to manage the sportsman racers? I'm sure there are other costs involved that I haven't listed here.

I don't know the attendance figures for St. Louis, but if there were a total of 60,000 spectators over the weekend at an average of $35 (just an assumption) a ticket that is $2.1M. If each spectator spent just $10 on concessions and souvenirs you add in another $600K for a total of $2.7M.

$70,000 less expenses looks like a drop in the bucket to me. If having sportsman racers at national events were such a cash cow for the NHRA, why did they cut back on the number of classes at each event and why do they limit the number of participants in each class?

Flame away.

Dave,

No flaming required! Just some corrections and additions to your flawed premise.

The 280 car count you list is on the extreme bottom end. The average is probably closer to 350 with events like the Vegas national posting 433 entries in just 4 categories.

What you also fail to realize is that for each sportsman entry, there is on average 2 crew passes purchased at a cost of $75 each.

Total payouts for each category are $11,000 (Comp), $13,300 (Stock) and $14,300 (Supers and S/S). And those totals are only achieved if every single paying position is filled, meaning there were no buy-runs in the money rounds.

So at the Vegas race, NHRA took in $173,200 in entry fees and crew passes. They paid out a maximum of $52,600 in purses.

Do you think $120,600 would go a long way to covering a weekends worth of operating expenses?

Even at an average event, where the payouts are even less, there going to clear almost $90,000.

 

[Suzie Q]

Wasn't that offer debunked by the Knapps after the last round of "E-town is closing!"? I thought they got a good chuckle from that.

Yup, it is not sold yet! Amazing that the price of one track is more than 4 tracks and the corporation!

 

[Harry Mannback]

Like everybody else I have more questions than answers right now. I was wondering if this will allow the NHRA to do things on the pro side that they could not do before as a non profit.

It seems to me also that it is a sweet deal price wise and that leads me to believe that it’s more of a separation on paper than creating two completely different entities. It also separates NHRA from the financial responsibilities of the Pro side.

I was also wondering how much stock has been offered, do the partners own enough to keep anybody from buying a majority ownership? Many companies retain the majority of their stock to avoid a take over.

As far as closing the pits to the public I hope not, however I can see them going back to charging to get to them but not to the Nitro Mall etc.

It will be interesting to see how this all shakes out.

Dan

 

[stanman]

This deal was an absolute bargain for HD based solely on the property values of the race tracks and the Glendora headquarters!

 

[D]

Let's remember that NHRA is not the only drag racing out there. There's IHRA running a great program - just wish there was an IHRA event a bit closer to me. There's also NSCA, ADRL, Fast Ford Weekends, and a really neat street car series running at E-Town and Atco, with pro stock/pro mod street cars running in the sixes. And the Lucas Oil divisional series has alky cars and lot's of sportsman cars. As long as the big names show up to race, so will the fans. Personally, I don't think much will change at NHRA, except Tom Compton and crew will now be accountable to someone outside his circle of "yes men".

True but for those of us not residing CONUS NHRA reach is global through AFN and ESPN international channels. Until I get a SlingBox set up in the states I won't be seeing anyother drag racing on TV.

S/F
D

 

[D]

.

If they DO split the sportsman events from the pro-shows entirely, what do they fill the space with between rounds? Can we take 30 straight minutes of THE POWERAID GUYS!!!!!!???

ARRRGGGHHH!!!! That is a truly evil thought, I'd rather slam my hand in a car door than have that.

D

 

[Paul]

Wow, I'm really curious to hear what some of the team owners think of this split, and hopefully we'll get some comments here. I'm wondering if they had any significant input into this decision, but I think I already know the answer to that one.

This relationship between NHRA Pro and NHRA can work while everybody is getting along, but if any serious issues ever develop between them it could be extremely messy as they are sharing the same name.

For example, what if the Pro group decides it wants to add some more "pro only" dates on the schedule to generate more revenue (ala NASCAR with racing almost every weekend) but the "non-pro" group disagrees and witholds sanctioning?

I hope that they have thought ahead about these kind of issues and have come to a least some general agreements on what to do if the two oranizations start going different directions.

Paul T.

 

[Jude]

Dave,

No flaming required! Just some corrections and additions to your flawed premise.

The 280 car count you list is on the extreme bottom end. The average is probably closer to 350 with events like the Vegas national posting 433 entries in just 4 categories.

What you also fail to realize is that for each sportsman entry, there is on average 2 crew passes purchased at a cost of $75 each.

Total payouts for each category are $11,000 (Comp), $13,300 (Stock) and $14,300 (Supers and S/S). And those totals are only achieved if every single paying position is filled, meaning there were no buy-runs in the money rounds.

So at the Vegas race, NHRA took in $173,200 in entry fees and crew passes. They paid out a maximum of $52,600 in purses.

Do you think $120,600 would go a long way to covering a weekends worth of operating expenses?

Even at an average event, where the payouts are even less, there going to clear almost $90,000.

Thanks Greg,

I was just going to do the numbers for Topeka but you saved me the effort.

I'm just concerned what the NHRA Pro's are gonna charge the NHRA Sportsmem for access to a national event.

Jeremy