Arch-Rivals Rogers Communications and BCE Unveil $1.32 Billion Deal For Top TV Sport Assets
The mobile and cable TV competitors now corner the Toronto market after acquiring a 75 percent stake in the Toronto Maple Leafs and the Toronto Raptors teams.
TORONTO – Broadcast giants Rogers Communications and BCE now control Canada's top pro sport teams in Toronto, the country’s biggest TV market, after they unveiled a joint $1.32 billion deal to acquire a 75 percent stake in Maple Leaf Sports and Entertainment (MLSE).
Rogers and BCE, which battle one another for Canadian mobile and cable TV customers, now jointly have the Toronto Maple Leafs and the Toronto Raptors pro sport teams to drive down their TV, mobile and online distribution pipelines.
The Ontario Teacher's Pension Fund is selling its majority stake in MLSE, which also includes the Toronto FC soccer club and the Toronto Marlies, the Maple Leafs' farm team.
Rogers, which operates the Sportsnet cable TV sports channel, is paying $533 million for a 37.5 percent stake in MLSE.
Nadir Mohamed, CEO of Rogers Communications, told a joint press conference in Toronto Friday that it made business sense for fierce competitors to come together to own prized TV sport properties.
“For iconic assets, brands that people love, the best way is to have as many fans everywhere having access. It’s the best way to leverage distribution,” Mohamed explained.
BCE, whose Bell Media subsidiary runs The Sports Channel, the country’s top-rated cable sports channel, will invest $398 million for a 28% stake in the pro sport team consortium, while a separate BCE pension fund will pay another $135 million to get the phone giant’s stake in MLSE to match Rogers’ own at 37.5 percent.
George Cope, CEO of BCE and Bell Canada, insisted the joint deal with Rogers also keeps the country’s most prized pro sport properties away from American ownership control.
“Most of all, the company remains firmly in Canadian hands as we go forward as there were many reports of ownership outside Canada going through this process,” Cope told the media conference.
Providence Equity, based in Rhode Island, was among earlier rumored bidders for the MLSE stake held by Teachers.
Larry Tanenbaum, a Toronto property magnate, will increase his stake in MLSE to 25% after the Ontario Teacher’s Pension Fund cashes out.
MLSE also has a range of TV sport assets, including LeafsTV, NBA TV Canada and Golf TV Canada.