Rogers, Bell acquire majority stake in MLSE
Posted December 9, 2011 11:25 am.
This article is more than 5 years old.
TORONTO, Ont. – Rogers and Bell Canada have teamed up to take majority ownership of Maple Leaf Sports and Entertainment.
Rogers announced Friday that it, along with Bell, are jointly acquiring a net 75 per cent stake in the company from the Ontario Teachers’ Pension Plan.
Rogers and Bell will each have a 37.5 per cent share in MLSE, each shelling out $533-million. Toronto businessman Larry Tanenbaum, through his company Kilmer Sports, will increase his current ownership from 20 per cent to 25 per cent.
The purchase price for the Teachers’ interest is $1.32-billion, based on an enterprise value of just over $2-billion.
Tanenbaum will remain as chairman of MLSE and as a governor of the NHL, the NBA and Major League Soccer.
MLSE held a news conference at 9:30 a.m. The speakers at the news conference included Tanenbaum, Rogers Communications president and CEO Nadir Mohamed, Rogers Media president Keith Pelley, and BCE president and CEO George Cope.
MLSE owns the Toronto Maple Leafs, Toronto Raptors, Toronto FC, Toronto Marlies and the Air Canada Centre, while Rogers already owns the Toronto Blue Jays, Rogers Centre and Sportsnet.
“MLSE is truly a world-class organization, a Canadian treasure that fans are absolutely passionate about,” Mohamed said. “Toronto Maple Leafs, the Toronto Raptors — two of the most iconic brands in sport. I can’t believe it, I love it — we’re going to be a part of this thing.”
He admitted Rogers and Bell compete on many fronts, but have been able to work together in the past, and cited the Olympics as a great example.
“We’re all very excited at getting things done. Today is truly a joyous day for all of us at Rogers,” he added. “Once of the things that we’ll bring to the table here is the learnings we’ve had, in terms of what it takes to build a winner, having a great game plan, sticking with it, and so for me, hopefully what we can do is help through our involvement with the board.”
“We’ve got great leadership under Larry […] we’ve got great management, and we’ll be relying on them to drive us to championship teams, just as we do with our organization with the Jays,” Mohamed said.
Tanenbaum said he’s looking forward to what’s next.
“I remain dedicated to the future — I know you are too. Here’s to winning,” he said.
In an earlier statement, Tanenbaum said: “I want to thank Teachers’ for their partnership over the last 15 years. Together, with our dedicated employees, we have built one of the finest sports and entertainment companies in the world.”
“I am excited to welcome our new partners Bell and Rogers. I am proud this is a made-in-Canada deal that will bring resources and expertise to help us win on and off the ice, court and pitch,” he added.
The transaction is expected to close in mid-2012 and is subject to regulatory and league approvals.
“There’s no doubt as fans, we all want the teams to win, and when a team wins, so do the players, the broadcasters, the distributors, the sponsors and yes, the owners, and that will be the goal,” Cope said.
The drama surrounding the sale of the majority stake in MLSE has been like a soap opera, according to 680News senior business editor Mike Eppel.
“It appears to me that when the [Ontario Teachers’ Pension Plan] took the Leafs off the block, supposedly two weeks ago, that was basically to calm things down,” Eppel said.
“It is almost a global entity at this stage, it’s worth a couple of billion dollars — very lucrative broadcast rights, it’s a consistent money maker. So there are a lot of reasons why you’d want to own it,” he added.
On Nov. 24, the Teachers’ announced they were taking the shares off the market after an eight-month search did not produce the desired price.
However, in a statement, the Teachers’ said it was approached by Bell and Rogers with “an unsolicited offer that meets all of its original terms and conditions for sale.”
“MLSE is one of Teachers’ longest standing and most successful investments,” Jane Rowe, senior vice-president of Teachers’ Private Capital, said.
“We are proud of this iconic company, in which we first invested in 1994. It is second to none in the industry and has a very bright future. We believe that Bell and Rogers, with their MLSE partner Kilmer Sports, will deliver on the company’s potential,” she added.
