Oh, Canada! Ontario Pension to Sell Maple Leafs

The Ontario Teachers’ Pension Plan decided over the weekend to try to sell its 66 percent stake in Maple Leaf Sports and Entertainment, the company that owns the fabled Maple Leafs of the National Hockey League, as well as the Raptors of the National Basketball League. Other assets include Toronto’s Air Canada Centre, where the two teams play, and the Toronto FC soccer club.

The Maple Leafs team is one of professional hockey’s most legendary and valuable franchises, having won 11 Stanley Cup hockey championships. It hasn’t, however, won a NHL championship since 1967, the longest drought of any team in the league.

The Ontario pension is reportedly seeking between C$1.3 billion and C$1.5 billion ($1.33 billion to $1.54 billion). Such a price would make the sale the largest in Canadian sports history. A spokeswoman for the pension fund declined to comment.

During the last several weeks, the pension fund was privately approached by several potential buyers, according to the Globe and Mail. Because of this interest from potential buyers, the pension decided to hire Morgan Stanley to help with the bidding process. It put out a press release on Saturday.

The remaining stakes in MLSE are owned by construction mogul Larry Tanenbaum, with 20.5 percent, and TD Capital, with 13.5 percent. Both Tanenbaum and TD Capital have a right of first refusal to buy a defined portion of OTPP’s stake.

Among possible outside buyers, reports mentioned cable and wireless provider Rogers Communications, which owns the Toronto Blue Jays and Sportsnet, a Canadian sports channel.

As Canada’s third-largest pension fund, Ontario Teachers has more than $100 billion in assets and covers more than 295,000 teachers and retirees, according to the press release.

Canada’s do-it-yourself pension plans have tended to make their own direct investments in private firms like MLSE, bypassing the expense and fees (and possibly missing out on the expertise) of private equity firms. Most pension funds in the United States, by contrast, invest in private companies almost exclusively through private equity firms.