The Work

December 9, 2011 6:00 PM

Four Canadian Firms Advise as Two Telecoms Buy a Stake in Maple Leafs, Raptors

Posted by Tom Huddleston Jr.

UPDATE: 12/12/11, 5:30 p.m., McCarthy T├ętrault advised Bell Canada parent company BCE, and Torys represented Rogers Communications, in negotiating the shareholders agreement between the two companies that led to Bell and Rogers jointly acquiring the 75 percent stake in MLSE.

Two of Canada's largest telecommunications companies aim to score a sizable chunk of the company that owns the NHL's Toronto Maple Leafs and the NBA's Toronto Raptors.

Bell Canada and Rogers Communications announced Friday that they will team up to pay roughly $1.3 billion to acquire a 75 percent stake in Maple Leaf Sports and Entertainment (MLSE) from the Ontario Teachers Pension Plan (OTPP).

MLSE owns both the Maple Leafs and the Raptors, as well as the Air Canada Centre arena where both teams play their home games. The company also owns Major League Soccer team Toronto FC, minor league hockey team the Toronto Marlies, and three digital television channels. Rogers already owns Major League Baseball's Toronto Blue Jays and that team's stadium, the Rogers Centre.

OTPP said in November that it planned to hold on to its MLSE stake. The pension plan changed course after being approached with the unsolicited bid from Montreal-based Bell and Toronto-based Rogers, according to the pension plan's own announcement.

OTPP currently holds a 79.53 percent stake in MLSE, with Canadian businessman Lawrence Tanenbaum owning the remaining shares through his holding company, Kilmer Sports. Tanenbaum announced that he will aquire the OTTP shares not going to Bell and Rogers, giving him a 25 percent stake in MLSE. He will continue to serve as the company's. Details about Tanenbaum's end of the transaction were not disclosed.

Blake, Cassels & Graydon is serving as deal counsel to both Bell and Rogers in connection with the MLSE acquisition. The firm's team includes M&A partners Shlomi Feiner and Jeffrey Lloyd, corporate partners Graham Smith and David Kruse, and real estate partner Thomas Von Hahn.

Blake Cassels is also acting as Bell's competition and banking counsel. Banking partners Michael Harquail and Simon Finch are advising on that side of transaction, along with competition partners Brian Facey, Julie Soloway, and Micah Wood.

Davies Ward Phillips & Vineberg is serving as competition counsel for Rogers, with a group that includes partners George Addy and Mark Katz.

OTPP, meanwhile, turned to Stikeman Elliott to advise on the sale. The firm's M&A team includes partners Jeffrey Singer, William Braithwaite, and Michael Burkett. They are joined by tax partner John Lorito and communications partner Gregory Kane, while counsel Lawson Hunter and partner Shawn Neylan are advising on competition issues.

In increasing its MLSE stake, Kilmer turned to Toronto-based Goodmans corporate partners Dale Lastman, David Matlow, and Michael Partridge.

The transactions, which are subject to approval by regulators and the teams' respective leagues, are expected to close in the middle of 2012.

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