Bell Media and Rogers Communications Friday announced that they "have partnered together to acquire a majority share" of Maple Leaf Sports & Entertainment for C$1.32B, according to TSN.ca. The two companies will each pay the current owner -- the Ontario Teachers' Pension Plan -- about C$533M for a 37.5% share and 75% combined. As part of the agreement, Kilmer Sports Inc. -- owned by Toronto businessman Larry Tanenbaum -- "will increase its current 20 percent stake in the company to 25 percent." Tanenbaum will "remain as chairman of MLSE and as a governor of the NHL, the NBA and Major League Soccer." MLSE owns the Maple Leafs, Raptors, MLS Toronto FC, the AHL Marlies and Air Canada Centre. The company also "has real estate holdings and television properties that include Leafs TV and Raptors TV" (TSN.ca, 12/9). In Toronto, Rob Longley reports the transaction is "expected to close in mid-2012 and is subject to league and regulatory approval." Bell and Rogers "represent TSN and Sportsnet, the No. 1 and 2 sports broadcasting powers in Canada, but they will call a truce and split the shares with so many lucrative deals to be spun off their union." It is believed that "neither company felt it could afford losing out to its competitor, especially given the value of TV rights" to the Maple Leafs in Canada (TORONTOSUN.com, 12/9). Source said that Rogers and Bell "have been trying to hammer out a shared bid for weeks because while neither wanted to pay the full asking price, the rivals also didn't want to risk the valuable TV rights falling into the hands of a competitor." Sources said that the Rogers family "had given their approval to buy the entire controlling stake" from the OTPP, but Rogers President & CEO Nadir Mohamed "convinced them that a joint bid with a major competitor was the more attractive option" (NATIONAL POST, 12/9). The GLOBE & MAIL's Kiladze, Perkins & Trichur report Bell and Rogers Friday "hinted that they have entered into long-term broadcasting agreements with MLSE, but the details have not been provided." Mohamed said that "more information will be made public in the future" (GLOBEANDMAIL.com, 12/9).
HOLDING ON TO CANADIENS SHARE? Bell owns an 18% stake in the Canadiens and has naming rights to the team's arena, and the company Friday said that it "will continue its minority ownership" of the franchise in the wake of its investment in MLSE. Bell President & CEO George Cope said, "Our investment in (the) Montreal Canadiens has been tremendous for Bell in our markets in Quebec and quite frankly that investment will be maintained." He added that Bell "will work with the NHL 'to accommodate any of their needs'" (CP, 12/9).
GAME CHANGER: In Toronto, Damien Cox notes the deal will "drastically alter the local sports landscape." Rogers, which already owns the Blue Jays and Rogers Centre, will now have a stake in "every major sports franchise in the city plus its two largest sports and entertainment venues." And the "biggest result of all this could be the formation of a new entity, some kind of new sports broadcast network for southern Ontario" (THESTAR.com, 12/9). Also in Toronto, Joe Warmington notes the deal will "divide TV assets up evenly to allow all the major carriers to get a piece of the action and avoids somebody putting together an all Maple Leaf/Raptors type network" (TORONTO SUN, 12/9). Mohamed during the announcement of the deal Friday said, “Sports content is king. Let’s face it nobody wants to watch a game two days later. Between the two organizations I can’t think of anybody that can bring live sports to Canadians wherever they are without missing a second” (THESTAR.com, 12/9).
CORNERING THE MARKET: The GLOBE & MAIL's James Christie writes under the header, "MLSE Deal Is Bad News For Sports Fans." Rogers and Bell are "in the business of selling tickets, selling TV packages, selling mobile phone access." There is "no imperative to put a winner on the field of play locally as long as the new owners have access to a winner -- and they do if they have broadcast rights to the major sport franchises in town." Christie: "The new owners could have the sports market -- and the customer -- cornered (GLOBEANDMAIL.com, 12/9).
