Explaining the Penguins' latest business changes as a key executive resigns

A fundraising event isnt usually the spot for a team to announce a big departure.

But when was there anything usual about the Pittsburgh Penguins business? Speaking during the annual Night Of Assists charity event at Rivers Casino on Wednesday night, Fenway Sports Group partner and Penguins alternate governor Teddy Werner told those in attendance that Kevin Acklin is stepping down as president of business operations.

Advertisement Acklin, who confirmed the decision in a statement, will finish a contract that expires in June.

A team source said Acklin and FSG reached a mutual decision to go in different directions.

The source was granted anonymity because they were not permitted to speak publicly.

Acklins decision is not related to FSGs ongoing pursuit of minority investors, team sources said.

Last week, The Athletic published this story to explain FSGs investor decision.

Acklins resignation raises more big questions.

Lets try to answer some of the big ones.

Why is the Penguins president of business operations resigning now? Acklins contract was expiring.

Hes 48 and in his seventh year with the Penguins.

He wanted a lighter schedule for an improved work-life balance.

His departure clears the way for FSG to find a business executive without ties to previous ownership.

He was appointed president of business operations in June 2022 after spending two years as chief operating officer and general counsel.

He filled a vacancy created by the departure of former CEO and team president David Morehouse in April 2022.

Acklin, who played hockey at Pittsburghs Central Catholic High School, was instrumental in overseeing the transition from the previous ownership group to FSG.

His enthusiasm lifted spirits during uncertain times, and he was singularly responsible for a well-received reunion between the organization and Jaromir Jagr a year ago.

However, Acklin inherited an outdated business model that was ill-suited for the challenges of a declining team on the ice in a post-pandemic world.

The Penguins hired Acklin in 2018 to be general counsel and senior vice president.

He was the point person for the redevelopment of the former Civic Arena site.

FNB Financial Center, a 26-story highrise that will serve as headquarters for First National Bank, opened in December 2022.

The Penguins will likely move some of their offices into the building, as space at PPG Paints Arena is cut down in favor of renovated revenue-generating suites and clubs.

A 4,500-seat music venue modeled after Bostons MGM Music Hall at Fenway is planned for the Civic Arena site and tentatively scheduled to open in 2026.

Advertisement Whats next? FSG will conduct a national search for either a replacement president of business operations or a CEO.

Werner, who spent 16 years as an executive with the Milwaukee Brewers, is regularly in Pittsburgh and will work with Acklin between now and June, when Acklin will depart.

Werner been more visible in recent months, taking a more hands-on approach than his predecessor, Dave Beeston, who left FSG last summer, team sources said.

Whats the latest on potential investors? FSG is in no rush to add investors.

It has been through a similar process before with Liverpool Football Club.

It has hired two firms to identify potential fits, but its not guaranteed FSG will take on any investors.

The buy-in is expected to be substantial at least $150 million, a team source said.

FSG would prefer a partner or partners with regional ties, but that is not a requirement.

The franchise is not for sale, team sources said.

FSG, which also owns MLBs Boston Red Sox and NASCARs RFK Racing in addition to Liverpool and the Penguins, does not have a history of selling its properties.

How is the Penguins business? These arent the best of times.

Gate revenue is the top driver for NHL franchises, and the Penguins have seen their average net revenue since last season drop more than any other team.

The Civic Arena site is still a work in progress halfway through the teams lease at PPG Paints Arena, which runs until 2040.

The Penguins are carrying debt and can no longer count on $24 million in annual revenue from AT&T SportsNet, which dissolved two years ago.

The loss in TV revenue is a major drag.

Instead of taking in $24 million with no operating costs, FSG now assumes the costs of running its own regional sports network, SportsNet Pittsburgh.

The Penguins are on track to miss the playoffs for a third consecutive season.

A playoff home game is worth at least $2 million to the team.

The Penguins have played only three since FSGs purchase in December 2021.

Advertisement None of this sounds great.

However, FSG has deep pockets, and though the team is in a financial downturn, it isnt in the same kind of dire economic straits as it was in the 1970s and 1990s.

The Penguins continue to spend to the NHLs salary cap, and FSG has spared no expense for hockey boss Kyle Dubas to build a modern, data-driven staff.

Although 30 employees were laid off in May 2024, the move is in alignment with FSGs way of doing business.

Most of the roles were filled or recast.

(Photo: Emilee Chinn / Getty Images).

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