Maple Leaf Sports + Entertainment went through a huge change today as the majority owner, the Ontario Teachers’ Pension Plan, sold its 79.53% share for $1.32 billion. The new majority ownership will be split between Canada’s two media giants Bell and Rogers Communications. This deal comes at a time where the OTPP had initially closed the door on idea of selling after the market had grown cold. It also puts two major media competitors at the same table.
In the announcement press conference, George Cope (President & CEO of BCE) and Nadir Mohamed (CEO of Rogers) sat side by side proclaiming their joy for owning a majority stake in MLSE. The awkwardness that came in the question & answer session gave fans the idea that this new partnership might not be in the best interest of the fans. Both Cope and Mohamed danced around numerous questions while taking what seemed like playful jabs at each other. The consistent answer in any question posed seemed to center around bringing the games to the fans on multiple platforms – not winning championships. The new breakdown of ownership has both Rogers and BCE owning a 37.5% stake while the rest of the 25% will go to Kilmer Sports Inc.
If I were a fan of these teams, I would be worried. Unlike the Tom Gaglardi press conference for the new ownership of the Dallas Stars (much smaller scale – mind you), this announcement stunk of hatred and competitiveness. When you have an ownership group that is competing against each other, rather than the other league teams, it plants a red flag or two. In my opinion, this new ownership may not have the team’s best interest in their short term goals. Rather, it now becomes a race between Rogers and Bell to see who can come up with the additional $533M+ to buy the other 37.5% to become the sole majority owner. When one company finally does have that full control, then the teams will be the top priority.
If you’re not familiar with MLSE, it is the entertainment company that owns the Maple Leafs (NHL), Marlies (AHL), Raptors (NBA), and Toronto FC (MLS). They are considered one of the biggest, if not the biggest, sports ownership groups in North America. This company is coming off a pretty exciting November day where Forbes.com named the Toronto Maple Leafs the top hockey club in value, putting them at $521M. And while that was great for the OTPP financially, the fans might argue the value in emotional terms. Since 1967, the four teams combined only have two championships:
Toronto FC: None
If Bell & Rogers can’t seem to get along in the board room, do you think that number will increase? Things won’t be well if they can’t.