PPG buys naming rights to Consol Energy Center for 20 years
The hockey rink formerly known as Consol Energy Center will be PPG Paints Arena for the foreseeable future but Pittsburgh Penguins fans floated a few suggestions of their own on Twitter on Tuesday as word of the change spread.
They chimed in with suggestions ranging from "The Big Drop Cloth" to "The Paint Can" and "The Bucket." One guy summed it up succinctly in Pittsburghese: "PPG Paints N'at."
"We do sell a lot of paint in cans," said Brian Iams, PPG Industries Inc.'s vice president for corporate and government affairs. "We have creative fans. I'm sure they'll find creative ways to use the name, and we look forward to it."
Consol Energy Center is no more under a 20-year naming rights deal the Penguins and PPG announced Tuesday. Team and company officials declined to disclose financial terms, but said the change takes effect immediately.
Ryan Martin, 25, a Penguin fan from Cranberry, said the new name is a mouthful.
"I think PPG Arena would be better than PPG Paints Arena, but it's a Pittsburgh company and that's pretty cool."
David Morehouse, the Penguins president and CEO, said the switch began during a November conversation with Michael McGarry, PPG chairman and CEO, at a hockey game.
Consol bought the naming rights to the arena that opened in August 2010 in a deal estimated to be worth $105 million over 21 years. Under that agreement, announced in December 2008, the energy company's name would have been on the arena through the 2029-30 season.
"Within our relationship we knew (Consol) wanted to change some things, so we took them the PPG offer and asked them if they'd be interested," Morehouse said. "They said yes."
He said "four or five" other companies approached the team, but PPG was the only one making a serious commitment and a firm offer. PPG will have naming rights until 2036.
Iams said the move would expose the company's product lines, particularly consumer paints, to hockey fans around the globe.
"We see a significant opportunity for PPG from a growth standpoint," he said. "We have a growing consumer paints business — Glidden and Olympic — that you find at local retail outlets, so we'll have an opportunity to interact directly with the Pittsburgh Penguin fan base with couponing and promotions."
Iams said the company did an in-depth marketing analysis before striking the deal.
"We did a full analysis on what the lift would be and it's positive for us and our business," he said.
Visitors to the Uptown arena will notice changes to the signage and marketing materials in coming weeks, but PPG's blue logo is already displayed under center ice. Consol signage may start coming down outside the arena right away and should be gone by the home opener Oct. 13, officials said. Workers began changing signs inside the building Tuesday morning.
Ron Dick, associate professor of sports marketing at Duquesne University, said Consol's recent financial problems likely played into its willingness to cede naming rights. He said another possible factor is that corporations are now paying more to have their names on sports stadiums, noting that the New York Mets are getting $400 million from Citibank over 20 years.
"If I had to take an educated guess I would say (Consol) probably wanted to get out from under that $5 million a year they're paying," Dick said.
Low gas and coal prices have hurt Cecil-based Consol. For the second quarter that ended June 30, Consol reported a net loss of $603 million, or $2.64 per share. That was a much larger loss than the $25 million, or 11 cents per share, it reported for the same period last year.
In a statement, Consol's President and CEO Nick Deluliis said the sponsorship of the arena "established our company as a household name."
"...Today, with our corporate transformation complete, the success and stability of the Penguins franchise assured and the future of the region on solid footing, we are proud to transfer the naming rights to the arena from one iconic Pittsburgh company to another," Deluliis said.
Contacted by the Tribune-Review, Consol spokesman Brian D. Aiello said the energy markets had nothing to do with the decision.
"This decision was driven by our cultural transformation as we pivot to the natural gas business. We now have one of the most recognizable brands in the Pittsburgh region, we have very effectively weathered the commodity price downturn and have resumed our drilling program, we have a vast opportunity set in front of us with the largest acreage footprint in the Marcellus and Utica shales (approximately 1.4 million net acres) and we enjoy the best performing stock in the region over the first nine months of the year, with a bounce of over 140 percent," Aiello said. "Our priorities as a company have shifted, and the timing was perfect to make this deal with PPG looking to accomplish similar brand awareness goals that the naming rights deal afforded to CONSOL over the last eight years."
In November 2015, Consol said it would not renew its 10-year deal to have its name on the Washington Wild Things minor league baseball stadium. That agreement expires in 2017.
The Penguins' Morehouse said Consol would remain a corporate sponsor, but on a smaller scale.
"Consol was a very important part of building this arena," he said. "They were part of the construction process when we were designing the building, and they're going to remain a partner with us for about 14 years."
Penguins owners Mario Lemieux and Ron Burkle last year began seeking potential buyers for the Pittsburgh franchise, and Morehouse said the team is still "exploring strategic options."
The Penguins own development rights to a neighboring 28 acres where the Civic Arena once stood, but have yet to sign a tenant, Morehouse said. The Pittsburgh Sports and Exhibition Authority, which owns the Lower Hill District property, is nearly finished installing sewers and utility lines and has started cutting new streets through the site.
Iams said PPG recently extended a lease for its global headquarters in PPG Place, Downtown, to 2031 and would not be moving to the Lower Hill.
PPG, founded in 1883 as Pittsburgh Plate Glass, provided the undulating, tinted-glass façade that serves as the hockey arena's signature design element. The energy-efficient glass panels contributed to the arena's certification by the U.S. Green Building Council as a Leadership in Energy and Environmental Design (LEED) Gold building.
The company employs 46,000 people in 70 countries, including 2,500 in the Pittsburgh region.
PPG announced in July that it would sell its more than 130-year-old flat glass manufacturing business for $750 million to Vitro SAB de CV of Mexico. That deal was finalized Monday. PPG still makes fiberglass in the United States, but most of the company's sales now come from paints and coatings.
In March, PPG began a corporate branding and marketing effort that included putting its name on a number of its products, including the Glidden and Olympic paint brands, Liquid Nails and Homax Products.