HOW TORONTO ALMOST LOST MASAI
EXCLUSIVE Before attempting to fire Rogers CEO Joe Natale, Edward Rogers fought plans to keep Raptors head Masai Ujiri, sources tell the Star
Former Rogers chair Edward Rogers actively fought plans to keep Masai Ujiri as head of the Toronto Raptors this summer — saying that he was not worth the amount offered — and then tried to extract an extraordinary benefit for his own company, the Star has learned.
To the relief of fans, the ploy by Rogers was unsuccessful, and the Raptors announced on Aug. 5 that Ujiri was staying on in Toronto as vice-chair and president of basketball operations.
However, new details have emerged suggesting that behind the scenes, the former chair of Rogers Communications Inc. tried to sabotage a high-performing executive with whom he had grown disenchanted — and ultimately failed in his bid because he appeared not to fully understand the governance structure of the NBA franchise.
There are parallels between the situation, which was confirmed to the Star by three sources with knowledge of the events, and what is playing out now at his family-controlled company. Telecom giant Rogers Communications has been plunged into chaos after Edward’s failed attempt to unseat the CEO, his subsequent removal as chair of the board last week, and his disputed claim that he has established a new board of directors.
The Star is not identifying the sources because they were not authorized to speak publicly about this matter.
Edward Rogers said Sunday that he has the “utmost respect for Masai Ujiri,” citing his leadership, his track record in scouting and building a roster, and his global citizenship. “Above all, I respect the man,” Rogers said. “Masai built an NBA champion and I have every confidence in him and his team to do so again.”
He said that negotiations can “test both sides” and that it was unfortunate that confidential board proceedings were made public.
Ujiri, Maple Leaf Sports & Entertainment Ltd. (MLSE) and Rogers Communications all declined to comment for this story.
Prior to his run-in over Ujiri, Edward was still chair of Rogers Communications, which owns a 37.5 per cent stake in Raptors owner MLSE. Rival telecom BCE Inc. owns another 37.5 per cent and Larry Tanenbaum’s Kilmer Group controls the balance.
After weeks of negotiations that began in mid-July, both MLSE chair Tanenbaum and Bell were on board with offering Ujiri a sweetened package that included incentive pay tied to a future increase in value of the Raptors — he had already added $500 million in value to the franchise since his arrival in 2013, taken the team to the playoffs in every year prior to the pandemic and won the NBA championship in 2019.
Other sports franchises from around the world were chasing Ujiri, according to an NBA source. One NBA team’s offer included a three per cent ownership stake along with a salary that eclipsed the $15-million-per-year deal he ultimately struck with MLSE. Teams in the English Premier League — soccer’s top domestic league — also made entreaties to Ujiri, an NBA Executive of the Year winner.
Tanenbaum and Bell were ready to lock Ujiri down, but, according to two sources close to the MLSE board, Edward Rogers was the holdout.
He told his partners he felt the compensation was too high, and, according to the MLSE sources and a source close to the NBA, Rogers was convinced the Raptors could be managed without Ujiri’s help by existing general manager Bobby Webster.
The increasingly tense situation came to a head during a late July meeting at Rogers’ Lake Rosseau cottage that cemented the executive’s antagonism toward the Raptors president.
Ujiri left the meeting feeling positive but Rogers told Tanenbaum it was one of the worst meetings he had ever had, according to MLSE sources. Rogers said the Raptors president was arrogant, according to sources, arriving with bodyguards, and that he failed to share his vision for the team.
The NBA source said Ujiri was caught off guard by that interpretation of the meeting, which he said had been amicable. The source also disputed that Ujiri brought bodyguards, saying the Raptors head had gone to Muskoka with his long-time driver so he could work in the car during the drive, as well as the videographer for a charitable project, who was tagging along as they were heading back to the airport after.
The sources said some time after the meeting, Rogers called Ujiri and told him he wasn’t worth the money he was being paid. The NBA source said the call left Ujiri feeling so angry and disrespected by Rogers that he considered taking a year off as president of the Raptors.
Others in the Maple Leaf Sports executive ranks went into damage-control mode, the two sources close to MLSE said, prompting a round of further calls to Ujiri to reassure him he would be protected from Rogers and urging him to ignore the comments.
Ujiri’s relationship with key MLSE board members, notably Tanenbaum, Dale Lastman and Bell CEO Mirko Bibic, ultimately made him feel comfortable enough to return to the Raptors as the team’s vicechairman and president, the NBA source said.
Meanwhile, Rogers had been holding out on agreeing to the contract and said he would only back down if 12 conditions were met. Eleven of the conditions concerned contractual issues such as the terms of incentivebased pay, but the 12th had nothing to do with Ujiri’s compensation.
The MLSE sources said Rogers wanted Bell and Tanenbaum to agree to a complex and potentially contentious plan that would see Rogers Communications take its 37.5 per cent stake in MLSE (which owns the Raptors, Toronto Maple Leafs, Argos, Toronto FC and other teams), and combine it with the Toronto Blue Jays to create a separate company.
The Blue Jays are wholly owned by Rogers Communications and investors have long said that holding the team as part of the much larger telecom and media company undervalues the franchise.
Throughout the Ujiri negotiations, the sources said, Edward Rogers was working with Tony Staffieri, the now-former chief financial officer of Rogers Communications, who was also a board member at MLSE.
Bell and Tanenbaum would not agree to Edward Rogers’ demands, which would have involved signing off on a complex set of team valuations and issues around control and broadcast rights.
But they still had a way out. Tanenbaum is governor of the Raptors, a position that gives him ultimate power to make a call on personnel issues at the team, a structure designed by the NBA to avoid stalemates between noncontrolling owners of teams.
The sources said Tanenbaum preferred to reach compromises with his partners, but in this case, he decided to overrule Rogers and sign Ujiri.
Rogers was furious, the sources said, and he and Staffieri tried to plead their case with NBA commissioner Adam Silver and the league’s general counsel Rick Buchanan. The two NBA officials told Rogers that Tanenbaum had the right to make a call on the contract, according to the sources.
On the contract negotiations, Edward Rogers said Sunday: “Masai understands better than anyone that negotiations test both sides. The best deals involve compromise and leave all parties feeling like winners.” He added he is pleased Ujiri remains in his current role.
“It is unfortunate that certain individuals continue to breach confidence by leaking and inappropriately divulging confidential board proceedings,” Rogers said. “Their motives are transparent. I won’t be dissuaded from doing what’s right for Rogers Communications Inc., its shareholders, employees, customers and other stakeholders.”
Unlike previous Rogers Communications CEOs Nadir Mohamed and Guy Laurence, current chief executive Joe Natale was not on the board of directors at MLSE and the sources said he was not involved in the contract negotiations with Ujiri.
Less than two months later, it was Natale who was in Edward Rogers’ crosshairs. In late September, after discovering a plan to replace him with Staffieri, who was an ally to Edward Rogers in the Ujiri affair, Natale went to the Rogers board, who voted to keep him on as CEO. Staffieri left the company on Sept. 29.
But it didn’t end there. Since then, the situation at Rogers Communications has escalated into one of the most contentious family brawls for power at a publicly traded company the country has ever seen.
After publicly criticizing the company’s performance, Edward was voted out as chair of the Rogers Communications board on Thursday afternoon following a motion that was moved by his mother Loretta and seconded by one of his sisters, who also sit on the board.
He struck back later that night with a plan to replace five of the directors who voted him out with nominees of his own. Edward said he had the power to do that because he remains chair of a family trust that controls 97 per cent of the company’s voting shares.
He now maintains that the board has been reconstituted with his own five directors. Both the previous board of Rogers Communications and lawyers for his sister Melinda Rogers-Hixon say the new board is not legal and has no authority.
On Sunday evening, Rogers went ahead anyway and held a meeting with his new board. After the meeting he issued a statement saying he was reelected as chair of the Rogers Communications board of directors and that he plans to launch court proceedings to confirm the changes.
Ahead of the meeting, Loretta Rogers and Edward’s two sisters, along with the five independent directors he purported to fire, issued their own statement saying they remain the “duly elected” members of the company’s board and, “No other group of individuals has any authority to purport to act as the board.”
Also over the weekend, his sister Martha Rogers unleashed a series of critical tweets and called for Edward to step down as chair of the powerful family trust. She vowed to “spend every penny defending the company, employees and Ted’s wishes,” referencing her late father and company founder Ted Rogers.
On Sunday, she took aim at Edward’s board meeting, calling it a “pretend” meeting that was not legal and criticizing Phil Lind and Alan Horn for supporting him. Both men are directors of the Rogers Communications board and sit on the advisory committee to the family trust.
Edward has been involved in the exits of previous CEOs and executives at Rogers Communications and his dealings with Ujiri were also not the first time he clashed with highly respected Toronto sports executives.
In 2014, Rogers attempted to hire Kenny Williams, then the executive vice-president of the Chicago White Sox, to fill the role Paul Beeston held as the president of the Blue Jays. That move was scuttled when Jerry Reinsdorf, the owner of the White Sox, alerted his close friend Beeston of Rogers’ intentions.
Rogers was also involved in the departure of Blue Jays general manager Alex Anthopoulos after negotiations fell apart over the role Anthopoulos would play under Beeston’s successor, Mark Shapiro.