Talk of Jays sale back in spotlight
Speculation rampant on who might buy team after Rogers exec revives idea
Speculation is rampant over who might want to buy the Toronto Blue Jays after a Rogers Communications Inc. executive suggested, for the second time in recent months, that the telecom giant was weighing putting Canada’s only Major League Baseball franchise on the block.
Rogers’ management first spoke about the potential sale of noncore assets including the Blue Jays and the cable giant’s stake in Cogeco Inc. at a September meeting with analysts. CFO Tony Staffieri floated the idea again Tuesday at a UBS conference in New York as a way to get better value for the asset.
While Staffieri told analysts that sports content remains key for Rogers — the ability to watch live sports is widely seen as a top reason customers buy television subscriptions instead of cutting the cord to stream content online — he noted that Rogers’ 12-year, $5.2-billion deal with the NHL for exclusive broadcast rights shows it’s possible to “rent” content instead of owning it.
“To be clear, there isn’t anything imminent that we’re about to announce, but we’re certainly looking at the alternatives,” Staffieri said.
“Again, I would like to get the content without necessarily having the capital tied up on our balance sheet.”
Analysts had renewed questions about Rogers’ plans for the sports team when CEO Joe Natale started his tenure this spring. Natale, who previously ran Telus, is known for his focus on core networks over content.
Given low interest rates, it could be a good move to sell the team and use the cash for share buybacks, reducing debt levels or increasing dividends, Citi analyst Adam Ilkowitz noted to clients this fall.
Rogers reiterated Wednesday that there are no specific plans, processes or timelines in place to sell the team, but Staffieri’s comments sparked chatter among baseball fans and Toronto’s wellheeled business community about future ownership options.
One obvious potential buyer could be Maple Leaf Sports & Entertainment Ltd., in which Rogers owns a minority stake. (Rogers and BCE Inc. each own 37.5 per cent, and Larry Tanenbaum’s Kilmer Sports Inc. owns 25 per cent.)
MLSE already owns the Toronto Maple Leafs, the Toronto Raptors and the Toronto FC.
Adding the Jays to the roster could improve sponsorship and sales opportunities, and would allow Rogers to keep a stake in the asset without the team affecting its quarterly results. In Rogers latest quarter, for example, its media division’s operating profit dropped 18 per cent primarily due to higher Blue Jays player payroll (including foreign exchange impact).
Rumours of a potential Blue Jays’s sale have cropped up over the years as the team struggled with poor performance. But its finances improved in the past few years after two consecutive seasons in the playoffs led to the fourth highest attendance in the MLB in 2017.