Leafs for sale (cont'd).....
- Thread starter LittleHockeyFan
- Start date
Zee
Active member
cw said:Zee said:
You made me laugh with that post in this thread.
I'm confident that you will eventually get your wish in the relatively near future (next couple of seasons at the latest).
I figure if I mention firing Wilson in enough threads it may eventually come true LOL
I'm going to the Leafs/Caps game tomorrow night, what have I gotten myself into?
Kessel Run
New member
Just because Gretzky was asked if he was interested, doesn't mean he is. The media kinda jumped the gun on that one.
Hank Yarbo
New member
Kessel Run said:
Yes but the fans will get blamed for creating the hype. We always take the fall for the medias premature pontification.
hockeyfan1
New member
Fanatic said:
The pension plan had never been very eager to part with MLSE, a franchise that can't help but pull in stellar profits regardless of whether the Leafs, its marquee team, wins or loses on the ice.
teams that make the playoffs provide huge boosts in profits to their owners, because players are not paid more to play in the playoffs. That means that all revenue the Leafs would get from playoff tickets, beer and popcorn sales and extra merchandise sales would fall almost straight to the bottom line. For MLSE, having the Leafs back in the playoffs would be a big win financially.
That to me, says it all!
hockeyfan1 said:
I think that's bogus reasoning.
Let's say the Leafs make the playoffs and don't get home ice (hardly a sure thing at this moment) and that they play three playoff games at home.
Let's assume very roughly the net profit is $2 mil per playoff game. They have to give half of that to the NHLPA under the CBA. So we're talking in the order of a maybe to get $3 mil or some low digit of millions. Sounds like a lot? Finger is costing them more in the AHL.
The Teacher's stake in MLSE is 80% and roughly worth $1.4-$1.8 billion - let's average that at $1.6 billion. If the Teachers can sell it for 5% more than it's worth, that's $80 million 'profit' (capital gain) on the asset. It's would take a heck of a lot of playoff games to make that up. And they'd probably send a contract or two more like Finger's to the AHL to pull it off in the years to come so it might come out as a wash for a number of Leafs seasons into the future.
The $1.6 billion portion they own of the MLSE entity (Raptors, soccer, Leafs, ACC, broadcasting, ML Square, etc) is darn near peanuts to these guys as it's only 1.5% of their investments.
A little playoff revenue of a few million bucks is definitely peanuts to these guys when they're worth over $100 billion. $3 mil is .0028 of one percent of their current value. They wouldn't and shouldn't spend a lot of time fussing over that because they have much bigger financial issues to concern themselves with.
"having the Leafs back in the playoffs would be a big win financially." ? In the bigger scale of things for the Teachers, nope it really wouldn't. It's darn near nothing to them financially.
MLSE is estimated to pull in $650 mil/yr revenue. Even if one were conservative and said they only made $65 mil (10%) profit on that (it's probably closer to $100 mil profit), what's the difference to MLSE between $65 mil and $68 mil (with 3 playoff games?). Not a whole heck of a lot. It's nice and I'm sure they'd prefer the better number but nobody is going to lose a lot of sleep over a $3 mil delta in profits even at that scale.
Now in terms of things like the "brand", that's more meaningful to them because that can impact the asset value more. So they'd prefer to make the playoffs and do well for reasons like that because those have a financial impact too. But the brand is not a year to year thing so much as it is something built up over time. The Leafs will inevitably return to the playoffs and the brand will rise some with that and fall a little when they miss. But even in the bigger scheme of things for the $100 billion OTPP, it's not a major, major thing over the course of a year.
I think other things like the economy, the status of their CBAs, status/opportunity of the other business ventures with MLSE, etc have more impact on the overall value because the Leafs brand is still in pretty darn good shape.
Now in terms of things like the "brand", that's more meaningful to them because that can impact the asset value more. So they'd prefer to make the playoffs and do well for reasons like that because those have a financial impact too. But the brand is not a year to year thing so much as it is something built up over time. The Leafs will inevitably return to the playoffs and the brand will rise some with that and fall a little when they miss. But even in the bigger scheme of things for the $100 billion OTPP, it's not a major, major thing over the course of a year.
I think other things like the economy, the status of their CBAs, status/opportunity of the other business ventures with MLSE, etc have more impact on the overall value because the Leafs brand is still in pretty darn good shape.
Saint Nik said:
Yankees bought a few championships under Steinbrenner. Few would argue that. But you can't do that in hockey with the CBA.
The Red Sox were corporately owned when they bought their world series recently. NY Times had a chunk along with a couple of others beyond Henry. They also have a very similar list of sports properties to MLSE. Henry is more in control which is a key difference but could he provide the Leafs with materially more than MLSE has with Burke? I doubt it. Prior to that Yawkey owned the Red Sox for decades and delivered no championships.
The St. Louis Cardinals you cite were corporately owned by Anheuser Busch until '96? and delivered three World Series plus three trips to the World Series. I think Leafs fans would take that in a heartbeat.
Manchester United went public in '90 or so. During the 15 years in that state, they won an absolute bundle of titles, cups and championships including the only treble ever won by an English team.
Didn't Chelsea have a long history of financial problems ?
Isn't there a rule for NFL ownership that they must be privately owned - no corporations? To cite one of their owners is like citing why a girl doesn't win the World Boxing Championships - corporations can't compete.
Rickey Wirtz did just fine. But was that all because of private ownership under the name Wirtz? Daddy didn't do so hot for about 50 years.
Molson's Breweries corporately owned the Habs for a number of years in the 80-90s mainly and won three Cups and went to one other finals.
What key contributions in terms of resources provided beyond what MLSE provided did Samueli or Karmanos provide as owners to their teams over the years that were critical to their winning a Cup? Both those teams have often tread water and not spent to the cap.
I don't see Comcast hurting the Philadelphia Flyers efforts to win. Their problems have been with management - not ownership. Ditto for MSG Inc who own the Rangers and are structured something like MLSE corporately. The Rangers have made management errors far more than anything the ownership has done to hurt their chances and they won a Cup.
So your examples against corporate ownership aren't exactly what I would describe as rock solid.
Sports teams are becoming very expensive assets. Worse for NHL teams, is that their bottom lines are not what we'd commonly see in NFL. So you need an entity with deep pockets or you're stuck trying to get lucky like the Canes or Ducks who cannot afford to spend to the cap every year.
There are only about 60 billionaires in Canada and less than 30 worth as much or more than MLSE. A bunch of them couldn't afford to buy MLSE without partners and leveraging like Stavros. Their money tends to be tied up in investments.
And for the next MLSE corporate step, they may need even more coin because I suspect the next corporate step might involve more investment in broadcasting ownership to further cashing in on the synergy of their sports products.
I think ownership groups like the Flames, Jets and Predators have are going to become more commonplace in the NHL. When they run into a Del Biaggio, it's not nearly as much of a problem for the group - just one partner to replace.
I don't think stereotyping ownership as private vs corporate is going to prove out in the future. The most common winners will be owners of either variety who have enough dough to maximize their chances to win in a given league and will hire good GMs letting them do their job without meddling.
Star exclusive: American company eyes Maple Leafs
According to internal financial statements obtained by the Star, MLSE estimated it would make a profit of $105 million this year
So a few mil more in playoff dough simply isn't going to get the $106 Billion Teachers Pension Plan that excited.
This is what the "excitement" has really been about:
Globe & Mail:
No MLSE sale means no top-up for TD
At first the deal seemed strange. Why was Teachers, which was trying to sell its MLSE stake, instead going the opposite direction and increasing its position in the company?
The idea was to consolidate ownership to make the stake more attractive to a buyer.
The deal took MLSE from three shareholders to two, leaving only Teachers' and minority shareholder Larry Tanenbaum. The plan was to make the negotiations with any buyer for Teachers' stake simpler.
One of the conundrums in the MLSE sale process was the fact that much of the value of the business, especially to a suitor from the media industry, comes from the rights to show Toronto Maple Leaf games on television. But under the multiple-shareholder structure, a buyer could purchase the Teachers' stake in MLSE and not be guaranteed the rights to the games. To protect minority shareholders, the rights had to be auctioned to the highest bidder.
That was said to limit the appeal of the Teachers' stake in MLSE to telecommunications and media companies like BCE Inc. (BCE-T39.450.050.13%) and Rogers Communications (RCI.B-T36.54-0.01-0.03%), who would be most interested in controlling MLSE for the TV rights.
By cutting out TD, one advantage was that potential buyers would have only to negotiate with Mr. Tanenbaum to try to find a way around the rights issue.
Clearly, it didn't work.
Further articles on this:
BCE-Rogers rift scuttles deal to buy Maple Leafs
The blue-chip Canadian companies were prepared to pay between $1.3-billion and $1.4-billion for the Ontario Teachers' Pension Plan's 79.5-per-cent stake in MLSE, and would have split the price down the middle. But they had a hard time working together, especially when it came to dividing up the prized broadcast and Internet rights that they were after, and their talks dissolved.
Teachers takes ?for sale? sign off Leafs
In addition to a high asking price and Tanenbaum, the Canadian Radio-Television and Telecommunications Commission complicated a potential sale recently. The CRTC ruled in September that cable operators such as Rogers Communications and Bell Media who own their own channels must also offer them to their competitors
That meant Rogers couldn?t buy Maple Leaf Sports and start a network that was available only to its own subscribers.
Similarly, the CRTC ruling would ensure that even if Rogers bought MLSE, Bell or Wind mobile phone customers would have the same access to live game broadcasts as Rogers phone customers.
Analysts have considered Rogers and Bell natural suitors for the MLSE stake.
The big deal is about exploiting more profits and increasing asset valuation via broadcasting & media rights. It the next logical frontier. Peddie laid the foundation with LeafsTV & Raptors TV. And this follows the model we see in places like Comcast-Flyers, MSG-Cablevision, other major sports teams, etc.
TD was in the way and the Teacher's bought them out.
CRTC got in the way and they tried to work that out, which per the above, they could not.
Tanenbaum is in the way but:
30 Thoughts
It's been reported many times that Larry Tanenbaum, who owns 20 per cent of the Maple Leafs' parent company, has the right of first refusal on any attempt to sell the Teachers' 79 per cent share. There is a point where his control dilutes. That point, however, is apparently far enough into the future that it won't affect this process.
Tanenbaum's control of this situation "dilutes"
So maybe the Teacher's are better served waiting Larry out.
And to get around the CRTC, the Teacher's are financially strong enough that they could buy a controlling interest in Rogers or BCE ... maybe that's an upcoming consideration.
BCE, Rogers and the Teacher's aren't stupid people. They smell big money is to be made in broadcasting and media rights through the synergy of ownership which improves bottom lines via reduction of common overhead (Leaf TV and Raptors TV are financial losers right now) and increase in asset values. All that's happened here is they haven't found a way to maximize making that big money yet exploiting that opportunity. In time, I suspect they will.
According to internal financial statements obtained by the Star, MLSE estimated it would make a profit of $105 million this year
So a few mil more in playoff dough simply isn't going to get the $106 Billion Teachers Pension Plan that excited.
This is what the "excitement" has really been about:
Globe & Mail:
No MLSE sale means no top-up for TD
At first the deal seemed strange. Why was Teachers, which was trying to sell its MLSE stake, instead going the opposite direction and increasing its position in the company?
The idea was to consolidate ownership to make the stake more attractive to a buyer.
The deal took MLSE from three shareholders to two, leaving only Teachers' and minority shareholder Larry Tanenbaum. The plan was to make the negotiations with any buyer for Teachers' stake simpler.
One of the conundrums in the MLSE sale process was the fact that much of the value of the business, especially to a suitor from the media industry, comes from the rights to show Toronto Maple Leaf games on television. But under the multiple-shareholder structure, a buyer could purchase the Teachers' stake in MLSE and not be guaranteed the rights to the games. To protect minority shareholders, the rights had to be auctioned to the highest bidder.
That was said to limit the appeal of the Teachers' stake in MLSE to telecommunications and media companies like BCE Inc. (BCE-T39.450.050.13%) and Rogers Communications (RCI.B-T36.54-0.01-0.03%), who would be most interested in controlling MLSE for the TV rights.
By cutting out TD, one advantage was that potential buyers would have only to negotiate with Mr. Tanenbaum to try to find a way around the rights issue.
Clearly, it didn't work.
Further articles on this:
BCE-Rogers rift scuttles deal to buy Maple Leafs
The blue-chip Canadian companies were prepared to pay between $1.3-billion and $1.4-billion for the Ontario Teachers' Pension Plan's 79.5-per-cent stake in MLSE, and would have split the price down the middle. But they had a hard time working together, especially when it came to dividing up the prized broadcast and Internet rights that they were after, and their talks dissolved.
Teachers takes ?for sale? sign off Leafs
In addition to a high asking price and Tanenbaum, the Canadian Radio-Television and Telecommunications Commission complicated a potential sale recently. The CRTC ruled in September that cable operators such as Rogers Communications and Bell Media who own their own channels must also offer them to their competitors
That meant Rogers couldn?t buy Maple Leaf Sports and start a network that was available only to its own subscribers.
Similarly, the CRTC ruling would ensure that even if Rogers bought MLSE, Bell or Wind mobile phone customers would have the same access to live game broadcasts as Rogers phone customers.
Analysts have considered Rogers and Bell natural suitors for the MLSE stake.
The big deal is about exploiting more profits and increasing asset valuation via broadcasting & media rights. It the next logical frontier. Peddie laid the foundation with LeafsTV & Raptors TV. And this follows the model we see in places like Comcast-Flyers, MSG-Cablevision, other major sports teams, etc.
TD was in the way and the Teacher's bought them out.
CRTC got in the way and they tried to work that out, which per the above, they could not.
Tanenbaum is in the way but:
30 Thoughts
It's been reported many times that Larry Tanenbaum, who owns 20 per cent of the Maple Leafs' parent company, has the right of first refusal on any attempt to sell the Teachers' 79 per cent share. There is a point where his control dilutes. That point, however, is apparently far enough into the future that it won't affect this process.
Tanenbaum's control of this situation "dilutes"
So maybe the Teacher's are better served waiting Larry out.
And to get around the CRTC, the Teacher's are financially strong enough that they could buy a controlling interest in Rogers or BCE ... maybe that's an upcoming consideration.
BCE, Rogers and the Teacher's aren't stupid people. They smell big money is to be made in broadcasting and media rights through the synergy of ownership which improves bottom lines via reduction of common overhead (Leaf TV and Raptors TV are financial losers right now) and increase in asset values. All that's happened here is they haven't found a way to maximize making that big money yet exploiting that opportunity. In time, I suspect they will.
Kin
New member
cw said:
Steinbrenner, by all accounts, was one of the driving forces on the ownership side in fighting the salary cap during the '94 strike(which was as much about big market owners preserving their turf as it was owners vs. players) and then in '96 started "buying" his titles. He couldn't have done it with the cap that he fought and knew would be bad for the Yankees.
cw said:
This isn't true in any meaningful sense. Henry has always been the principal owner. Sure, he had and has minority partners but so did Steinbrenner. Henry has still served the same role as Steinbrenner.
cw said:
This is where, much like the whole rebuild/retool thing, I have to point out that just because something is the right blue-print doesn't make it a guarantee. You still need to be the right kind of person and Yawkey, a pretty serious racist, was the wrong person.
cw said:
Close. They were owned by the Busch family and the various members of the Busch family were some of baseball's most hands-on owners throughout the years.
cw said:
Right. Until Abromovich. So you see my point there.
cw said:
Huh. So you're saying that the most successful of all the major sports leagues is the one that doesn't allow for corporate ownership?
cw said:
So they had a long stretch with the wrong owner and then found the right one. Again, I don't think it's a terrific argument to point out that the best possible structure still doesn't provide a guarantee because the wrong kind of person can be the owner if the argument I'm making hinges on the owner being the right kind of person.
cw said:
Well, but, remember that part of my argument regarding MLSE is that their "Drive for the Middle" as opposed to the sort of full rebuild that can be necessitated by financial hardships isn't good for the team. To use a tricky analogy here owning a sports team might be compared to parenting to a degree. I'm sure there are many different thoughts as to what makes for a good parent but I'm relatively comfortable that money, while providing is an important necessity, isn't in and of itself a sign of quality. Leaving the kids with the credit card, regardless of it's limit, may be seen by some as irresponsible.
LK asked me earlier as to what Mike Ilitch does that makes him such a successful hockey owner and the reality is I don't know. When it comes to this and what the atmosphere is behind closed doors with regard to the various owners we all have to plead a degree of ignorance. Worse still, when we're trying to identify what makes for a successful owner too often we're working backwards from success so that anything a successful owner does/is is then attributed to that success.
With that said though, I think a pretty common thread that runs through what I've read of successful owners is that they have a real responsibility as the ultimate head of the organization in terms of setting the standards of required excellence and ensuring that they're met(Jonah Keri's The Extra 2 Percent is a good illustration of this).
Sometimes, as I've said, that involves being the advocate for their team. Karmanos, for instance, was widely reported during the lockout as being one of Gary Bettman's staunchest allies in terms of seeking the hard cap that aided smaller market clubs so much. His team then went out and won the cup. MLSE, on the other hand, sat on their thumbs as the team's largest competitive advantage flew out the window and haven't made the playoffs since.
I mean, you say that success is going to come from wealthy owners who don't meddle but another reality is that many of the most successful owners in sports history have been the opposite. Or, rather, they've been people who used their clubs to generate their income and meddled relentlessly. Steinbrenner is a perfect example of this. By a lot of accounts Steinbrenner bought into the Yankees without a lot of money of his own but saw the coming business landscape better than most and built the Yankees into the financial juggernaut they are today. It's important to remember that when Steinbrenner bought the team the Yankees were coming off one of the worst stretches in club history where they'd ceded a lot of ground in the city to the Mets.
But he meddled relentlessly, he gamed the system as it existed and when people came along to try and change the system so as to handicap the Yankees he was the guy who fought it the hardest.
More to the point, and this definitely comes up whenever you read about the man, dude was competitive. He chased the dollar but he was driven by a desire to win that occasionally got him into trouble. He set standards and he was quick to can the people who didn't meet them.
The reality of the sports landscape today is that an owner that's purely driven by dollars and cents may want to win but, as you note, that's not going to produce the kind of money that's going to make or break them. A so-so team can still earn huge money in terms of TV rights and positioning themselves correctly to take advantage of them. A perfect advantage of this is what we saw with the McCourt divorce case where the TV deal signed was for 3 billion dollars and most people laughed at how undervalued they'd been. Add in things like the way a team can position their ownership into big money in real estate development and things like, oh, big sports bars and the reality is that wins and losses aren't going to be the end of the world when it comes to generating cash.
The drive to win has to come from the top and I don't think money alone creates that.
Saint Nik said:
Steibrenner bought championships which a NHL owner cannot do.
Saint Nik said:
I said this:
"Henry is more in control which is a key difference but could he provide the Leafs with materially more than MLSE has with Burke?"
Which you couldn't answer because the question is basically rhetorical. He materially could not in the NHL. And once again, like Steinbreener, he could buy championships in MLB which he could not in today's NHL.
Secondly if you think the NY Times, Tom Werner and Larry Lucchino blindly said "Hey John Henry, here's our $100 mil as a minority shareholder with no strings attached. Have a grand old time with it. Hope it works out!", I think that's profoundly naive. Their lawyers were very likely to kick in by-laws to probably have super majority clauses or conditions and limits on what Henry could and could not do without their approval. For example, If Henry wanted to hand out a $100+ mil contract to a player, he may very well have been required to get their approval on taking the company substanttually deeper into debt (the contract being assumed as a guaranteed libility on the books). Which is not dissimilar to what Leafs and all NHL GMs I've heard of have to do on big contracts - they all have dollar limits.
I've seen company owners who gave a tiny percentage of ownership to employees only to find out that those employee-shareholders have a right to stop their majority shareholder from getting a bank loan in some corporate circumstances. Privately held minority shareholders usually have rights - particularly when big bucks are involved because they can afford the lawyers to properly put them in place. There's no way that gigantic investment money went to John Henry without something in the shareholder agreements that limits what he can do with that money or their liabilities. If John Henry didn't need them to at the very least share the risk or raise the cash, he wouldn't have bothered with them.
When Stavro needed TD to help finance him leveraging to get ownership of the Leafs, I'll bet he darn near signed over his first born. Why should TD get involved unless they were absolutely secure. They're a bank well versed in getting security. Stavro needed TD. TD did not need Stavro unless he made it attractive and secure for them to achieve a business win. Stavro took control of the Leafs with staggeringly little cash relative to it's value.
For that reason, I regard John Henry's control of the Boston Red Sox significantly differently than Steinbrenner's control of the Yankees. Because it is.
Saint Nik said:
No they were owned by the corporation: Anheuser Busch
http://www.baseballlibrary.com/ballplayers/player.php?name=gussie_busch
In 1953 (Gussie) Busch convinced the board of directors of the St. Louis-based brewery Anheuser- Busch to purchase the hometown Cardinals
Gussie couldn't just up and buy the team either. Since he desired AB to own it, Gussie had to convince the board of the corporation to go along.
http://en.wikipedia.org/wiki/Anheuser-Busch
The St. Louis Cardinals baseball club were owned by Anheuser-Busch from February 20, 1953 until the club was sold to a group of private investors on March 21, 1996.
http://www.houblon.net/spip.php?article6369
Ownership was a different matter. The company went onto the New York Stock Exchange in 1980. Gussie Busch controlled 12.5 percent of the stock, but much of that was freed from trusts upon his death nine years later. By the time InBev came knocking, the company executives and board members owned only 4.5 percent of all shares. Warren Buffett, the stock guru in Omaha, Neb., controlled slightly more than that through his Berkshire Hathaway Inc.
A corporation owned the Cardinals and that corporation was governed by a board of directors from 1953 to the end of Anheuser Busch's ownership of the Cardinals. The board of directors could dump Gussie because he lacked controlling shares and they did to some degree in 1971 or so for poor financial performance, replacing him with his right hand man, Richard Meyer. Then another Busch, his son forced them out of control in 1974-5. That couldn't happen to George Steinbrenner because he had complete control. Gussie Busch was not a similar type owner that had absolute and total control of Anheuser Busch like Steinbrenner had of his operation. Like Peddie, Gussie had to get apporoval from his board of directors. Unlike Peddie, he had a significant stake in the company - but like Peddie, unlike John Henry, not even a controlling stake.
Kin
New member
cw said:
Leaving aside that "buying" championships was as much of a impossibility in baseball as it was for the Rangers in the NHL, you're still ignoring why it was that baseball's salary structure was the way it was. Steinbrenner looking after the interests of his team come CBA time.
cw said:
Which I don't. I don't think Steinbrenner's minority owners did that either, which is what makes their situations similar.
Also, I think I answered the "what could Henry provide that the MLSE didn't" in the bulk of the text.
Kin
New member
lamajama said:
Not to get too deep into it but "buying" a championship is largely meaningless as a phrase without a real definition. Does it help a team, in an uncapped environment, to be at or near the top of the league in terms of payroll? Sure. But those teams still need to draft and develop talent. Trying to short cut that process with free agency typically doesn't work for a team in baseball just like it didn't work for the pre-lockout Rangers in hockey.
And I think it's a misleading picture of how those Yankees teams won their titles. Those teams were built on their farm system and the players it produced like Jeter, Williams, Pettitte, Posada, Rivera and on and on. They were at the top of the league in payroll for most of those titles but not by a particularly wide margin. As an example, in 1998 which was probably the best season the Yankees ever had, they didn't even have the highest payroll in their division.
Those Yankees teams "bought" their titles the way that the pre-lockout Red Wings or Avalanche did.
Further to this post:
link to previous post
Maple Leaf Sports plans broadcast gamble
The surest sign that Maple Leaf Sports is plotting a new network is the company?s hiring of consultant Ed Desser, a former National Basketball Association executive who has helped Time Warner Inc. plan its own regional sports network in Los Angeles, a channel that?s built around basketball?s Lakers.
Desser and investment bankers have urged Maple Leaf Sports to abandon their traditional practice of selling team broadcast rights to the likes of Rogers Communications and Bell Media. Currently, Maple Leaf Sports generates about $34.5 million ? $700,000 per game ? selling local broadcast rights to 46 Leafs games.
Desser instead has suggested Maple Leaf Sports start its own network, a move that would allow the company to keep all the advertising revenue generated from the broadcasts, as well as so-called carriage fees that cable operators would pay to show the channel.
Thanks to recent changes in the Canadian broadcast industry, channels could not refuse to carry a Maple Leafs-themed channel.
It?s hard to say how much money Maple Leaf Sports would make immediately from such a channel.
and this which summarizes and links to a speculative interview
MLSE is off the market, planning sports network instead
Now that the company won?t be bought up anytime soon?$1.5 billion offers were reported?MLSE is allegedly planning to make a major expenditure of its own: starting a regional sports channel. As the Globe and Mail noted a year ago, MLSE already has a broadcasting licence for a channel tentatively named Real Sports (like the sports bar with the giant television it already owns). It?s undoubtedly a risky venture: not only would it be costly for both the company and subscription-paying fans, but expanding digitally would also require negotiating with Bell and Rogers, which won?t be happy about the increased competition. What?s more, although MLSE would have regular content from the Maple Leafs, the Raptors and Toronto FC, it?s unclear how the channel will entertain its paying customers seven days a week, especially during the summer months. According to Metro Morning?s business commentator Michael Hlinka, that could be reason enough for the Maple Leafs to allow another hockey team in southern Ontario to intrude on their turf. Look for some intriguing developments in 2015, when the Leafs? local broadcasting contract is up
The precise direction MLSE is going is speculative at this point in time. However, where I think the media was wrong is in it's representation of what has transpired.
I would agree that Teacher's very probably got some inquiries about selling MLSE from Rogers and/or BCE and/or others. It's a lucrative property for broadcasters. The widely publicized notion that the Teachers didn't get their price though, I think misrepresents their exercise.
I think they looked at a variety of business alternatives including the selling of MLSE. Several of those scenarios involved what direction they should go if they kept MLSE - particularly with the next obvious and lucrative frontier: broadcasting. The decider on which way they should go was which way would make them the most dough - the selling price being the answer to only one of those alternatives in direction.
MLSE has been heading in this general direction for some time. It's not a surprise that they'd look closer at broadcasting for future business growth and revenues.
In fact, the best bid from broadcasters would provide them with some insight as to their broadcasting intentions and help them justify the business case to go in another more lucrative broadcasting direction. One does learn from both sides in this sort of process.
I don't have a clue for sure what the final broadcasting direction will turn out to be in spite of the speculation. Maybe they're still working a few broadcasting alternatives. But before 2015, when their broadcasting contracts expire, things should be considerably clearer.
This is not just a bottom line year-to-year profit consideration for the Teachers. The Peddie MLSE-expansion corporate model, the Cablevision-MSG corporate model and the Comcast-Flyers corporate model, much like the impact of the NHL CBA in 2006, is also very much about increasing the asset value of the business through the synergies of the related business. Peddie has been very successful at doing so while maintaining a healthy bottom line.
For the fans of the team, it does concern me some because the end result may be that they turn to the cable deals carrying their broadcasts to milk a few more bucks out of the fans via cable fees or a few more games may trickle to a specialty channel like LeafsTV.
No sense getting too upset about it until we learn more facts.
link to previous post
Maple Leaf Sports plans broadcast gamble
The surest sign that Maple Leaf Sports is plotting a new network is the company?s hiring of consultant Ed Desser, a former National Basketball Association executive who has helped Time Warner Inc. plan its own regional sports network in Los Angeles, a channel that?s built around basketball?s Lakers.
Desser and investment bankers have urged Maple Leaf Sports to abandon their traditional practice of selling team broadcast rights to the likes of Rogers Communications and Bell Media. Currently, Maple Leaf Sports generates about $34.5 million ? $700,000 per game ? selling local broadcast rights to 46 Leafs games.
Desser instead has suggested Maple Leaf Sports start its own network, a move that would allow the company to keep all the advertising revenue generated from the broadcasts, as well as so-called carriage fees that cable operators would pay to show the channel.
Thanks to recent changes in the Canadian broadcast industry, channels could not refuse to carry a Maple Leafs-themed channel.
It?s hard to say how much money Maple Leaf Sports would make immediately from such a channel.
and this which summarizes and links to a speculative interview
MLSE is off the market, planning sports network instead
Now that the company won?t be bought up anytime soon?$1.5 billion offers were reported?MLSE is allegedly planning to make a major expenditure of its own: starting a regional sports channel. As the Globe and Mail noted a year ago, MLSE already has a broadcasting licence for a channel tentatively named Real Sports (like the sports bar with the giant television it already owns). It?s undoubtedly a risky venture: not only would it be costly for both the company and subscription-paying fans, but expanding digitally would also require negotiating with Bell and Rogers, which won?t be happy about the increased competition. What?s more, although MLSE would have regular content from the Maple Leafs, the Raptors and Toronto FC, it?s unclear how the channel will entertain its paying customers seven days a week, especially during the summer months. According to Metro Morning?s business commentator Michael Hlinka, that could be reason enough for the Maple Leafs to allow another hockey team in southern Ontario to intrude on their turf. Look for some intriguing developments in 2015, when the Leafs? local broadcasting contract is up
The precise direction MLSE is going is speculative at this point in time. However, where I think the media was wrong is in it's representation of what has transpired.
I would agree that Teacher's very probably got some inquiries about selling MLSE from Rogers and/or BCE and/or others. It's a lucrative property for broadcasters. The widely publicized notion that the Teachers didn't get their price though, I think misrepresents their exercise.
I think they looked at a variety of business alternatives including the selling of MLSE. Several of those scenarios involved what direction they should go if they kept MLSE - particularly with the next obvious and lucrative frontier: broadcasting. The decider on which way they should go was which way would make them the most dough - the selling price being the answer to only one of those alternatives in direction.
MLSE has been heading in this general direction for some time. It's not a surprise that they'd look closer at broadcasting for future business growth and revenues.
In fact, the best bid from broadcasters would provide them with some insight as to their broadcasting intentions and help them justify the business case to go in another more lucrative broadcasting direction. One does learn from both sides in this sort of process.
I don't have a clue for sure what the final broadcasting direction will turn out to be in spite of the speculation. Maybe they're still working a few broadcasting alternatives. But before 2015, when their broadcasting contracts expire, things should be considerably clearer.
This is not just a bottom line year-to-year profit consideration for the Teachers. The Peddie MLSE-expansion corporate model, the Cablevision-MSG corporate model and the Comcast-Flyers corporate model, much like the impact of the NHL CBA in 2006, is also very much about increasing the asset value of the business through the synergies of the related business. Peddie has been very successful at doing so while maintaining a healthy bottom line.
For the fans of the team, it does concern me some because the end result may be that they turn to the cable deals carrying their broadcasts to milk a few more bucks out of the fans via cable fees or a few more games may trickle to a specialty channel like LeafsTV.
No sense getting too upset about it until we learn more facts.
Sale of MLSE to Rogers, Bell is close
Sources have told QMI Agency that a deal worth as much as $2 billion is close to being settled with telecommunications behemoths Bell Media and Rogers Communications, who have been rivals in the past for the much desired 79.5% shares of MLSE.
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.
An announcement could come as early as Friday, but there are many moving pieces that could delay the final sale until closer to Christmas
...
It was just two weeks ago that the Teachers announced they were taking the shares off the market after an eight-month search did not produce the desired price. At the time, industry analysts concluded that only a joint venture of some kind between broadcasting kingpins would fetch the big dollars that Teachers was seeking and the November announcement can now likely be put down to a game of high-stakes poker
Haven't found a confirming source for that story yet
Sources have told QMI Agency that a deal worth as much as $2 billion is close to being settled with telecommunications behemoths Bell Media and Rogers Communications, who have been rivals in the past for the much desired 79.5% shares of MLSE.
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.
An announcement could come as early as Friday, but there are many moving pieces that could delay the final sale until closer to Christmas
...
It was just two weeks ago that the Teachers announced they were taking the shares off the market after an eight-month search did not produce the desired price. At the time, industry analysts concluded that only a joint venture of some kind between broadcasting kingpins would fetch the big dollars that Teachers was seeking and the November announcement can now likely be put down to a game of high-stakes poker
Haven't found a confirming source for that story yet