SBD/March 14, 2011/Franchises

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  • Ontario Teachers' Pension Plan To Explore Sale Of 66% Stake In MLSE

    Ontario Teachers' Pension Plan wants minimum of C$1.5B for MLSE stake

    The Ontario Teachers' Pension Plan "confirmed in a press release Saturday that it will explore the possibility of selling" its 66% majority share of Maple Leaf Sports and Entertainment, according to Perkins, Shoalts & Grange of the GLOBE & MAIL. A source said that the OTPP "chose to take this route after speculation about a sale prompted a number of potential buyers to express their interest." The pension plan "received a lot of calls in the past few weeks from parties who would consider buying its stake, and chose to hire advisors and officially explore a sale." Sources said that the OTPP "wants a minimum" of $1.5B (all figures Canadian) for its stake in MLSE, a 25% "premium over what the shares are worth." One source said that MLSE Chair Larry Tanenbaum, "who holds the second-largest stake in MLSE, has no plans to sell his shares," and most insiders "believe he will make a play for control of the company." Tanenbaum owns 20.5% of MLSE and "has the right of first refusal on the Teachers shares along with the third company shareholder, TD Capital," which owns the remaining 13.5%. The shareholder agreement "allows them to buy Teachers' shares in proportion to the shares they own," which means Tanenbaum is allowed to buy 60.3% of the OTPP's 66% stake. Montreal's La Presse reported on Saturday that the pension plan "has hired investment bank Morgan Stanley to find buyers" (GLOBESPORTS.com, 3/13).

    BIG TIME SALE: In Toronto, Dan Ilika noted the sale, if completed, would be the "largest in Canadian professional sports history." If the OTPP "did indeed hire Morgan Stanley, it would mean it got the go-ahead from the NHL, which must be consulted before any possible sale discussions can take place." The hiring of Morgan Stanley "will now allow the group to come up with the highest possible bids before approaching Tanenbaum and TD Capital." Tanenbaum "has long been interested in becoming sole owner of MLSE, but whether he can match the potential bids remains to be seen." MLSE is the "largest sporting group in Canada," owning the Maple Leafs, Raptors, AHL Marlies and MLS Toronto FC, as well as Air Canada Centre, BMO Field and Ricoh Coliseum, and Leafs TV and NBA TV Canada (TORONTO SUN, 3/13). The OTPP "would not confirm or deny that it had hired Morgan Stanley to conduct the search." MLSE President & CEO Richard Peddie "declined comment" (TORONTO STAR, 3/13). In Toronto, Steve Simmons cites sources as saying that the OTPP is "looking to hit a financial home run," as the pension plan is looking to see if it "can cash out with at least" $1.3B. But a source close to MLSE said, "Anybody who says they know what's going on in this deal is not telling the truth. ... The thing about this deal is, even the people who know, don't know." Simmons notes those who know Tanenbaum "wonder whether he has the stomach -- or the willingness -- to live through more years of the personal heartache that has gone along with owning the Leafs and the Raptors." He "may not want to take on such onerous debt, or new partners of his choice, in order to come up with more than $1 billion for absolute control" of MLSE (TORONTO SUN, 3/14).

    IS ROGERS INTERESTED? The GLOBE & MAIL's Robertson, Shoalts, Erman & Perkins report Rogers Communications Inc. is "conspicuously absent from the list of suitors interested in acquiring" the OTPP's stake in MLSE. High-ranking sources at Rogers said that the company "has 'very little' interest in putting in a bid, even though there were reports late last year that Rogers was in talks to buy MLSE." The sources said that Rogers "walked away from any notion of buying the Toronto Maple Leafs and the Toronto Raptors and other MLSE assets last spring and never revisited the idea." Rogers officials "expect to be invited to look at MLSE's books when the formal auction process begins, but the company does not intend to change its mind" (GLOBE & MAIL, 3/14). But in Toronto, Cribb & Van Alphen cite sources as saying that there are "four clear contenders salivating over the notion of owning all of that high-demand sporting content for their networks: Rogers Communications, Bell Canada, Shaw Communications and Telus Communications." Many experts "see Rogers as the leading suitor." The addition of the Maple Leafs and Raptors to Rogers' current ownership of the Blue Jays "would provide it with an unprecedented stranglehold in the Canadian sports broadcasting world, and one of the most commanding packages of properties anywhere." While "wealthy individual bidders are less likely, two names have emerged" -- Thomson Reuters Chair David Thomson and RIM co-CEO Jim Balsillie (TORONTO STAR, 3/14). But the GLOBE & MAIL's Shoalts writes, "Contrary to some fans' wishful thinking over the weekend, it will not be BlackBerry billionaire Jim Balsillie, whose attempts to put an NHL team in Hamilton made him toxic to the league's governors" (GLOBE & MAIL, 3/14). The WALL STREET JOURNAL's Weinberg & Dummett note it was "unclear if active negotiations about the stake were under way" (WALL STREET JOURNAL, 3/14).

    BUSINESS AS USUAL: Maple Leafs G Jean-Sebastien Giguere said of the potential sale of the OTPP's stake, "It's not like the team is moving or anything like that. We don't have uncertainty that Phoenix would have or Atlanta would have. The way an owner runs a team is pretty well governed by ... the collective bargaining agreement. From one owner to the next, it's very similar" (TORONTO STAR, 3/14).

    Print | Tags: Franchises, Maple Leaf Sports and Entertainment
  • Nolan Ryan Takes Over As CEO Of Rangers After Chuck Greenberg Is Forced Out

    Ryan takes over day-to-day operations of Rangers after Greenberg's departure

    MLB Rangers co-Chairs Bob Simpson and Ray Davis Friday asked President Nolan Ryan "to take over all aspects of the day-to-day operation of the club," giving Ryan the additional title of CEO after Chuck Greenberg was "forced out," according to Evan Grant of the DALLAS MORNING NEWS. Ryan "expects to hand over much of the day-to-day business operations to a number of executives brought in under Greenberg." Since the '10 regular season ended, the Rangers have hired COO Rick George, Exec VP/Business Partnerships & Development Joe Januszewski and Exec VP/Ticket Sales & Marketing Todd Taylor. Greenberg "will leave the club immediately" in a "sudden and shocking development." Davis: "In reality, management styles and chemistries sometimes don't fit together. This was the situation with Chuck, the board and Nolan." Simpson, Davis and Ryan "declined to address ... how the marriage fell apart so fast and during a time in which the Rangers experienced such success." Theories "abound that Greenberg's aggressive style and very public persona didn't mesh well with Ryan, holdover front office members and the board of directors." Another theory is that he "may have fallen victim to New Owner Syndrome, in which an owner is seduced by the power and glamour of involving himself in decisions pertaining to the team on the field." Simpson, Davis and Ryan "declined to comment on specifics, other than to dismiss any notion that Greenberg's high public profile was a cause for the separation." Greenberg "did not respond to interview requests," but he said in a statement, "Unfortunately, Nolan Ryan, the co-chairmen, and I have somewhat different styles" (DALLAS MORNING NEWS, 3/12).

    RAPID DEPARTURE
    : In Ft. Worth, Jeff Wilson noted "no one involved in the stunning events of Friday provided any specifics as to how seven months of apparent normalcy came to a screeching halt." Sources said that Braves officials "weren't pleased with how Greenberg shifted the Rangers' High-A affiliate to Myrtle Beach, one of the minor-league clubs he owns that had long been associated with the Braves," and their "discontent reached" MLB Commissioner Bud Selig's office. Also, in December, members of the Rangers' baseball operations staff "were taken aback by how involved Greenberg became in daily internal discussions during the winter meetings." More recently, Greenberg and Ryan "were pitted against each other as an extension for general manager Jon Daniels was being pounded out." Greenberg "had sold the suite at Rangers Ballpark that Daniels had used to host families of front-office personnel as well as conduct meetings." The suite was "to be part of the Daniels extension, and it was sold despite objections from Ryan" (FT. WORTH STAR-TELEGRAM, 3/12). Simpson said that Rangers Baseball Express "had already bought out Greenberg's share of the team," and that Greenberg "declined an offer to stay with the Rangers in a different role." Simpson: "He chose to move on. He likes to do deals" (ESPNDALLAS.com, 3/12).

    DON'T MESS WITH TEXAS: ESPN DALLAS' Jim Reeves noted, "Nobody's figured out exactly what Greenberg did to make Ryan mad." A source said, "I don't think there was really any one thing. I think Chuck just overstepped his boundaries some. ... He may have wanted to be more of the face of the franchise." Ryan: "It's like a marriage. You think things are going to work out in business, but until you get in there, you never know how things are really going to work." Reeves wrote, "If you push Nolan Ryan, eventually he's going to push back. Hard" (ESPNDALLAS.com, 3/12). In Dallas, Kevin Sherrington wrote, "It's easy to see what could have happened: Ryan grew weary of Greenberg inserting himself on the baseball side." Greenberg "made some good hires -- so good, in fact, that the ownership group felt no need to replace him" (DALLAS MORNING NEWS, 3/12). Also in Dallas, Jean-Jacques Taylor wrote Greenberg "screwed up." You "don't mess with Nolan Ryan." Taylor: "His passion for the game and his desire to see the Rangers finish what they started last season by making the club's first foray into the Word Series led him to overstep his boundaries and become too involved in the organization's baseball side" (DALLAS MORNING NEWS, 3/12). In Ft. Worth, Randy Galloway wrote the "only word" from Ryan was "him or me." A source said, "The relationship just wasn't going to work. Nolan knew that. He could have put a Band-Aid on it, and tried to let it heal, but many of the owners didn't want the Band-Aid. They wanted a change" (FT. WORTH STAR-TELEGRAM, 3/12). FS SOUTHWEST's Tracy Ringolsby wrote Greenberg "didn't fit with much of anybody." Ringolsby: "When it became a him-or-me decision for the men who have the money invested in the team, it was a no-brainer. The Texas money men were in Ryan's corner. That should have been obvious when the ownership group met in Scottsdale last week. Greenberg was conspicuous by his absence." Greenberg was an "embarrassment at times," and he "alienated the folks in Major League Baseball with his overbearing approach" (FOXSPORTSOUTHWEST.com, 3/11).

    ANOTHER ONE BITES THE DUST: The DALLAS MORNING NEWS' Grant wrote, "This theory must be considered: Greenberg was the absolute right guy to lead the purchase effort of the team; he was the wrong guy to lead the team" (DALLAS MORNING NEWS, 3/13). In Ft. Worth, Gil LeBreton wrote Greenberg "had become a rock star," and to Rangers fans he "remained a hero." But Simpson, Davis and Ryan "seemed to agree" that Greenberg's departure was "about business." Ryan: "As we got into the business side of it, we had differences of opinion." LeBreton wrote Greenberg "had to be formidable," because Ryan "doesn't seem the type to engage in a personal power struggle." LeBreton: "If Nolan Ryan felt Friday's announcement was necessary, who are we to doubt him, awkward as that revelation might be?" (FT. WORTH STAR-TELEGRAM, 3/12). Also in Ft. Worth, Mac Engel wrote Greenberg's departure "isn't a crippling blow," but rather "just another bad PR move from a franchise that just can't help but continue to author the 'How To' book on bad press." The "sad part is that Greenberg was a positive, national presence for a franchise that doesn't have one" (FT. WORTH STAR-TELEGRAM, 3/12). SI.com's Jon Heyman noted Greenberg was "seen as small-timer from out of town who tried to over-run things." Heyman: "Too often, he just ran his mouth and that's what got him in trouble" (SI.com, 3/11). But the MORNING NEWS' Grant wrote, "The issue was not that Greenberg talked too much. In most situations, his visibility and upbeat approach, were real assets to the Rangers' cause. It was internally where Greenberg's management style clashed with that of the Board of Directors'" (DALLASNEWS.com, 3/12). In Boston, Nick Cafardo wrote, "Don't know all the details yet, but my initial reaction is that Chuck Greenberg got shafted by his fellow Rangers owners" (BOSTON GLOBE, 3/13). In Ft. Worth, Jennifer Floyd Engel wrote, "This should have been the best off-season in Rangers history. ... Instead they waded through the [Michael Young] mess, and now this Greenberg messiness" (FT. WORTH STAR-TELEGRAM, 3/12).

    Print | Tags: Texas Rangers, Franchises
  • Perks Of Renovated MSG Major Reason For Knicks, Rangers Ticket Price Hikes

    MSG Sports Friday announced that prices will increase for Knicks and Rangers season-ticket holders at the soon-to-be renovated MSG, and "most of the increase will be borne by ticket holders in the Garden's lower bowl," according to Jeremy Olshan of the N.Y. POST. MSG Sports President Scott O'Neil said that "high-end food, drinks and fancy digs account for the lion's share of the hike." O'Neil: "If you take out the all-inclusive, you are at a 28 percent increase." Olshan noted a "select 100 season-ticket holders will get free food and non-alcoholic drinks at their seats and in the posh 1879 Club, named for the year of MSG's founding." The "next best 800 seats will get a similar all-inclusive amenity, at the just slightly less luxurious Delta Sky360 club." MSG officials also "admitted team performance is a factor in ticket hikes." They noted that prices for Knicks season tickets have "stayed stagnant the last six years in part because of the Knicks' lackluster play" (N.Y. POST, 3/12).

    MSG TICKET PRICE INCREASES
    49% average increase for Knicks season tickets
    23% average increase for Rangers season tickets
    $600 per-game increase for courtside seats to $3,600
    173% to 198% increase for seats in row directly behind court or rinkside
    Best 100 seats get free food and non-alcoholic drinks at seats and in posh 1879 club
    Next best 800 seats get free food and drinks at seats and in the Delta Sky360 club
     

    INSIDE THE NUMBERS: On Long Island, Neil Best noted while MSG officials "declined to offer a complete breakdown of the new pricing," the figures were "skewed by big increases in the lower bowl." Rangers season-ticket prices went up 23%, compared to 49% for the Knicks. One factor in the lesser increases for the Rangers was that their prices "have risen in four of the past five years" (NEWSDAY, 3/12). ESPN N.Y.'s Ian Begley noted season tickets "will be offered at 20 different price points for Knicks fans, with seats starting at $35 per game," and "at 17 different price points for Rangers fans, with the least expensive seat selling for $39 per game." O'Neil said MSG's renovation is the "dominant reason why prices are where they are." He added there were "several different factors" for the increases, but noted the prices "were made before" the Knicks acquired F Carmelo Anthony (ESPNNY.com, 3/11). O'Neil said of the price hikes for lower-bowl seats, "For the beachfront property, you really have to pay more." In N.Y., Belson & Sandomir noted "one element missing in the Garden's ticket pricing is the sale" of PSLs, "which were used by the Giants and the Jets to the dismay of many of their fans." O'Neil: "A lot of fans told us they didn't want them" (NYTIMES.com, 3/11).

    PRICED OUT: In Newark, Dave D'Alessandro wrote Knicks and Rangers Owner James Dolan "imposes the increase for one reason: because he can." The Knicks "will have an average ticket price on the north side of $100 next season," and D'Alessandro wrote, "The thing that sincerely surprises us about all this ... is that there is anyone left who can afford Knicks tickets" (Newark STAR-LEDGER, 3/13). But in N.Y., Christian Red wrote "at least New York basketball and hockey fans won't have to contend with the dreaded" PSLs. There have been "plenty of groans at the World's Most Famous Arena the past decade," but the "buzz is back at 33rd and Seventh" (N.Y. DAILY NEWS, 3/12).

    LOSING ITS ATMOSPHERE: In N.Y., Larry Brooks writes Rangers games once drew "rabid crowds," but they have become "polite audiences." Brooks: "And it's only going to get worse for the Bluebloods and it's only going to become more alien for the Blueshirts as the transformation of the once intimidating arena moves forward into a future in which only the swells will be able to afford the luxury of going to the games given the absolutely staggering ticket price hikes the Garden will impose on its customers beginning next season." Dolan "isn't doing anything immoral;" he is "doing business." But he "should be prepared for the 'lower bowl' to be comparatively empty, the way the preposterously priced seats on the privileged side of the moat are at Yankee Stadium" (N.Y. POST, 3/14). Also in N.Y., Phil Mushnick writes it is "as if the local ballparks and arenas should be viewed and attended as restaurants and hangouts, as if the games played within are mere throw-ins and sideshows, like a pool table in the back." Mushnick: "The Garden, Yanks, Mets, Jets and Giants push the outermost limits of affordability then explain that they're doing it for you, not for them" (N.Y. POST, 3/14).

    Print | Tags: New York Knicks, New York Rangers, Madison Square Garden, Franchises
  • NFL Lockout Watch, Day 3: Teams' Approaches To Layoffs, Furloughs Vary

    Richardson does not have any layoffs or furloughs planned due to lockout

    Panthers Owner Jerry Richardson "has taken an active role re-assuring his employees they will be fine" during the NFL's lockout, according to Darin Gantt of the CHARLOTTE OBSERVER. Multiple Panthers employees said that Richardson "has been vocal in recent weeks about his desire to keep things normal inside the building." No "layoffs or furloughs are planned at the moment, and there's a sense of optimism that things may remain normal until the fall, while the football portion of the equation is anything but." A Panthers staffer said of Richardson, "He wants us to know he's serious about taking care of us, and that's something he takes pride in. No one wants to take that for granted, but for now, he's telling us we're OK." In addition, agents for several of the coaches hired by the Panthers this offseason said that "there's nothing in the language of their new contracts that cuts their pay in the event of a lockout" (CHARLOTTE OBSERVER, 3/12).

    JETS: In N.Y., Manish Mehta noted the Jets' "lockout contingency plan that includes furloughs for 96 business employees and a 25% pay cut for football operations staff," including coach Rex Ryan and GM Mike Tannenbaum, "began with the start of the lockout" Saturday. Jets Senior Dir of Media Relations Bruce Speight said, "Our plans are in effect. This is a fluid situation. We will obviously be evaluating our approach as events unfold." Meanwhile, the lockout "may affect the Jets' training camp agreement with SUNY Cortland." The team "has two years remaining on its three-year contract with the university." The team said that if there is "no training camp in Cortland this summer, the Jets would be required to hold camp at the university through 2013." There are also "two two-year team options to extend the contract signed in 2010." If training camp this season is "abbreviated due to a lockout, it's uncertain whether the Jets would be required to hold camp in Cortland in 2013" (N.Y. DAILY NEWS, 3/13).

    RAMS: In St. Louis, Jim Thomas reported no "layoffs or job terminations are expected at Rams Park under a work stoppage." League sources said that any Rams personnel changes "will be changes that were already being contemplated regardless of the labor situation." But the sources added that "most, if not all, Rams assistant coaches will receive a pay cut under a work stoppage." It is "not clear if new offensive coordinator Josh McDaniels, who was hired less than two months ago, is included in that group." It also is "not clear when that pay cut takes effect." Since there is still "plenty for coaches to do up until the draft, the pay cuts might not take place until after the draft when the minicamps and the spring practices known as OTA's take place" (ST. LOUIS POST-DISPATCH, 3/12).

    PACKERS: The Packers Saturday said that "they’ve frozen salaries and hiring, and have provisions for sizeable salary cuts at higher levels of the organization, though those have not yet been initiated." Packers VP/Administration & General Counsel Jason Wied said those receiving "fairly sizeable" cuts would include President & CEO Mark Murphy and GM Ted Thompson. Wied: "We wanted to end up with a system where we did not lay off employees. That said, it does require sacrifices on the part of the organization" (GREEN BAY PRESS GAZETTE, 3/13).

    LIONS: Lions President Tom Lewand on Saturday said that the team "does not plan any immediate furloughs, layoffs or paycuts because of the NFL lockout." Lewand "did not express concern when asked how the lockout would impact business for next season." He said that season-ticket deposits, both renewals and new sales, "are up over this time last year." Lewand: "We’ve got a good relationship with our season-ticket holder base. We sent them a letter ... that will go out electronically to them today, go out also by U.S. Mail. We’ll be communicating through our websites and through email blasts with them. I think it’s important to maintain direct communication with them" (DETROIT FREE PRESS, 3/13). 

    STEELERS: In Pittsburgh, Gerry Dulac noted there are "no indications the Steelers have plans to lay off front-office workers or reduce salaries for the lockout" (PITTSBURGH POST-GAZETTE, 3/13). Steelers President Art Rooney II said that coach Mike Tomlin's assistants "will be paid through the summer, but their contracts let him trim wages 'if things go on very long.'" Meanwhile, Steelers PR & Media Manager Burt Lauten said that "no current players are scheduled for the April 30 'Steelers Fan Blitz' at Heinz Field, although retired Steelers will be on hand" (Pittsburgh TRIBUNE-REVIEW, 3/13).

    THE SHOW MUST GO ON: 49ers President & CEO Jed York posted a letter to fans on the team's website stating in part, "As in recent years, we will be inviting you to participate in the draft weekend excitement with our annual Draft Contest and Draft Day Party. ... In fact, to every extent possible, we will be operating with a business-as-usual attitude. So, this summer, keep an eye out for announcements inviting you to our annual Family Day and State of the Franchise, as well as additional Fan Forums" (THE DAILY). Bears President & CEO Ted Phillips also sent out a statement Saturday, saying in part, "We still plan to host fan events this offseason starting with our 'Ultimate Weekend,' which includes our Draft Party and Bears Expo at Soldier Field" (CHICAGO TRIBUNE, 3/12).

    Print | Tags: Franchises, NFL, Football
  • Jeff Moorad Completes Sale Of D'Backs Stake For $21M

    Moorad's group controls 49% of Padres, still owes about $145M for team

    MLB Commissioner Bud Selig on Saturday said that the sale of Padres Vice Chair & CEO Jeff Moorad's general partnership in the D'Backs "has been completed," according to Barry Bloom of MLB.com. A source said that Moorad's approximate 8% of the franchise was "sold for $21 million." The share was "absorbed by the current" D'Backs partnership headed by Managing General Partner Ken Kendrick. Selig said, "That's been completed. Fortunately, that's another issue I don't have to worry about." Moorad and the D'Backs "had been at odds about the value of his former share for two years, and the matter was turned over to the Commissioner's Office." The two sides "independently came to agreement just prior to the opening of Spring Training." Selig said that Padres VP/Baseball Operations Josh Byrnes "must also divest himself" of his D'Backs share. Byrnes, who was "dismissed as Arizona's general manager last season," owns a "very small percentage of the franchise." Selig said, "That's a situation that does need to be settled and I'm sure it will be" (MLB.com, 3/12). In San Diego, Bill Center noted Moorad's group "controls 49 percent of the Padres and still owes" Chair John Moores "approximately $145 million." But Moorad yesterday said that his group "doesn't have to make another partial payment until the full amount is due on the fifth anniversary of the sale in 2014, although the sale could be completed ahead of the deadline." Moores is "rumored to be interested in purchasing the Houston Astros, but can't act on that deal until he is no longer the majority owner of the Padres" (SAN DIEGO UNION-TRIBUNE, 3/14).  

    Print | Tags: Franchises, San Diego Padres, Arizona Diamondbacks
  • MLS Earthquakes' Sponsor Revenue Up 30% From '10 With Latest Agreements

    The MLS San Jose Earthquakes have inked a multiyear deal with Farmers Insurance and an additional multiyear deal with 7Up and Snapple. Earthquakes President David Kaval said the new partner signings, combined with expanded deals with Verizon, Xfiniti and restaurateur Bon Appetit Management Company, have pushed the team’s overall corporate partnership revenue up 30% from '10. “This not only shows that we are a property that companies value, it’s a really good springboard into our plans for the new stadium,” Kaval said. The team recently demolished buildings on the site of its proposed 15,000-seat stadium near downtown San Jose. 7Up and Snapple’s activation will include in-stadium sales and signage at the team’s current home, Santa Clara Univ.’s Buck Shaw Stadium. Farmers’ partnership will include signage and designation as the official sponsor of the April 2 Night of Champions event, where the Earthquakes honor high school soccer champions in the Bay Area.

    Print | Tags: San Jose Earthquakes, Soccer, Franchises
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