As the Toronto Blue Jays clinched their division yesterday, their owner was plotting how they’re gonna create one of the largest sports empires in the world.
Driving the news: Rogers is looking to pool its multibillion-dollar sports assets into a single company, either through an initial public offering or (more likely) a few deep-pocketed private investors to help foot the bill.
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The telco, which has increased its stake in Maple Leaf Sports and Entertainment (MLSE) to 75%, will have the chance to buy the remaining 25% next year.
Why it matters: Bringing Rogers’ sports assets under one roof would create one of the largest sports and entertainment companies in the world.
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If they can pull it off, that would make Rogers the sole owner of the Toronto Raptors, Toronto Maple Leafs, Toronto Blue Jays, Toronto FC, Toronto Argonauts, Sportsnet, and a host of other assets, including Toronto’s Scotiabank Arena and Rogers Centre.
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That would rival the likes of Los Angeles Rams and Arsenal FC owner Kroenke Sports & Entertainment, and Boston Red Sox and Liverpool FC owner Fenway Sports Group.
Yes, but: IPOs in the sports world have proven to be tricky. MSG Sports — one of the few ownership groups that have gone public — trades at a 55% discount to the underlying value of its New York Knicks and Rangers franchises.
Bottom line: For Canadian sports fans who care more about their favourite team winning than the profit margins of ownership, an IPO could be bad news. Unlike hand-picked private money, public market investors are going to be more focused on quarterly earnings (aka beer and hot dog sales) than the wins and losses, which could mean a reluctance to spend on top talent.—LA