Are the Blue Jays up for sale?
On rumblings from the ownership level and a new Globe and Mail piece that suggests Rogers is looking to "cash in" on the team.
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According to a new report from the Globe and Mail, Rogers is looking to “cash in” on the Blue Jays to help finance their deal to buy Shaw Communications. So let’s talk about it!
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The Globe’s Andrew Willis is reporting here on Monday that Rogers is very seriously considering selling “some of its stake in” the Blue Jays. Given the way that the perception of ownership has changed in the Mark Shapiro era, this might sound like a scary proposition for many Jays fans.
Finally the team seems to be recognized at the ownership level as the potential blue chip MLB franchise it should have always been. The Jays are being allowed to spend money ahead of future projected revenue, which is definitely something new for them. Especially last winter, when many teams were unwilling to spend because of pandemic-induced “losses,” the Blue Jays — a team that was forced to pay millions to upgrade facilities in Buffalo in 2020, and that, it was understood even then, would be impacted in 2021 by Covid-19 more than most due to the border — handed out the richest contract in club history to George Springer, in addition to a number of other win-now moves.
Things have been good lately! A change at the top wouldn’t necessarily be bad, but wouldn’t necessarily be welcome either. But all along there have been signs that change is afoot.
Before we get to the Globe’s report let’s first go back to Saturday night. During the second intermission of Saturday’s Hockey Night in Canada telecast, Elliotte Friedman of Sportsnet reported some very interesting news from the hockey world that could have had serious implications for the Jays at the ownership level. Last week Fenway Sports Group, which owns the Red Sox, began the process of buying the Pittsburgh Penguins (though the sale is not yet complete). Before that, however, they apparently explored a merger with MLSE, which is of course owned in part by Rogers.
About 12 to 18 months ago, before Fenway Sports Group went down this road with the Penguins, an emissary was dispatched to ask Maple Leaf Sports and Entertainment — the owners of the Maple Leafs, the Raptors, Scotiabank Arena, among other properties — if they would be interested in a merger with Fenway, which owns the Red Sox, and Liverpool, and probably soon the Penguins. But they targeted MLSE first, and it was a merger, as it was explained to me. Now, that would have had some challenges, such as, they own the Red Sox and Rogers owns the Blue Jays, and how would that have all been worked out? But there's no question it would have been a massively powerful company if it had happened.
Now, it didn't go very far, as I've been told the Maple Leaf Sports and Entertainment group made it clear they weren't ready for that yet. But there's a lot of people looking at what Fenway is doing, their aggressive nature, and the fact that they're purchasing teams in different markets, and they're thinking that this is the way sports could be going, and what Fenway is doing is where we're headed. So I think the question about places like Maple Leaf Sports and Entertainment is maybe they weren't ready then, but it doesn't mean they aren't going to be asked again, and I don't know where we're going, but it sounds like we're going to some pretty interesting places.
Pretty sure Jack Kent Cooke was doing this a half a century ago, but I digress. The fact that the Jays and Red Sox would have shared an owner in this scenario absolutely would have complicated things. One entity can’t own multiple teams, and I doubt the fact that Rogers’ share in a merged Fenway/MLSE would have been relatively small (they only own 37.5% of MLSE) would have made much difference. Would it have meant Rogers having to choose between keeping either the Jays or their stake in MLSE? I have no clue, but am glad we didn’t have to find out.
Still, if Friedman is right and the idea of a merger with a similar group isn’t off the table, this kind of thing could crop up down the line if the Blue Jays are to remain owned by Rogers.
According to Monday’s Globe report, this isn’t the motivating factor behind a potential sale of the Jays being put on the “front burner,” but it certainly was an early indication that there is the potential for change at the top.
So too was something that came up in the piece about Edward Rogers and Masai Uijri from Christine Dobby and Doug Smith of the Toronto Star (and, presumably, crisis PR firm Navigator) that was published last month, at the height of the fight for control of Rogers’ board of directors. In that one it was reported that Rogers had been trying to get the other stakeholders in MLSE (Bell and Larry Tanenbaum) to agree to let them combine the Blue Jays and their 37.5% stake in MLSE into a separate company. That would have brought the Jays out from under Rogers’ corporate umbrella — important because, as the piece notes, “investors have long said that holding the team as part of the much larger telecom and media company undervalues the franchise.”
As Monday’s Globe piece tells us, Rogers aims to fund its $26 billion takeover of Shaw Communications with $20 billion in debt. That’s a hefty load! And adding to it the financing of a new stadium or a major renovation of the current one for the Blue Jays — something Mark Shapiro has already made clear is on the horizon — presumably wouldn’t look so great on the company’s books. I think that’s more likely what’s behind these new rumblings, in addition to the influx of cash a sale of the team would add to Rogers’ debt-ridden coffers.
Here’s where things get interesting. This is from the Globe’s Monday report:
Options under consideration for the Blue Jays and Rogers Centre include selling a minority stake in the ball club, spinning off the team or raising money by selling “tracking shares,” according to one company source and a source in banking. Tracking shares, a type of specialized equity offering that would mirror the value of the team, are already used by the owner of at least one other Major League Baseball franchise, the Atlanta Braves.
The Braves announced the creation of these “tracking shares” in late 2015, when their move to a WhiteFlight Park was already in the works (construction on it began in mid-2014). So that if that’s the route Rogers goes here it won’t necessarily have to precede whatever the Jays are planning with regard to the stadium.
Spinning the team off into a new company has obviously already been considered. Selling a big stake to a minority owner — MLSE? Tanenbaum? — could certainly make sense as well as a way to clear at least some of the debt the Blue Jays are about to incur on their stadium project from Rogers’ books.
And there should be no shortage of suitors, because clearly this is an incredibly valuable property — something to keep in mind next month when MLB’s owners start crying poor about “outlandish” demands from the players union. The Globe’s report says that the Jays and the stadium are “worth an estimated $2-billion.” Rogers bought an 80% stake in the team for $112 million USD ($165 million CAD) in 2000, eventually acquired the other 20%, and bought the stadium for $25 million CAD in 2004. They’ve done extremely well on this little venture.
The idea of simply selling to MLSE should hold some appeal to fans, though presumably not to Rogers, who I’m sure prefer to retain their monopoly on the incredibly valuable TV content the Jays provide to Sportsnet, their national TV sports network.
Because of that relationship with Sportsnet, the Globe adds, should they elect to spin out the team, “the company and the franchise will face issues around related-party transactions. Sources said those potential conflicts are part of the reason the company has kept all its sports and media properties under one roof.”
There is, therefore, one potential buyer who seems rather obvious. Here again, is Andrew Willis.
If Rogers did decide to sell a portion of the Blue Jays to an individual, the sources said company chair Edward Rogers is a potential buyer. The vast majority of professional sports franchises are owned by wealthy individuals, rather than public companies.
Blue Jays executives already report to Mr. Rogers, and the 52-year-old is chair of the team. He is also its representative on Major League Baseball’s board. At Blue Jays spring training games in Dunedin, Fla., Mr. Rogers sits in the stands watching his sons serve as bat boys.
Ahh. Yes. That’s the one.
It’s strange that the prospect of Edward Rogers becoming personally invested in, if not the full-on owner of the Blue Jays doesn’t seem quite as terrifying as it once would have, but here we are. Of course, there remains a strong odor of ol’ meddling Bunglefuck Eddie to all of this stuff. Rogers’ power play against his own family has seemingly worked, with Joe Natale formally ousted as Rogers CEO last week, and Edward’s ally Tony Staffieri installed as interim CEO of the company — the former chief financial officer who left the company in late September, less than two weeks after accidentally revealing to Natale the secret plans to replace him because he didn’t know how to use a phone.
According to the Globe’s report Natale was also looking at ways to “monetize” its stake in the Blue Jays, but perhaps that process will be accelerated now that Edward’s cronies reign supreme. Willis adds that his “sources said they expect a decision on whether to sell the Blue Jays to be made after the end of negotiations on a new collective bargaining agreement for Major League Baseball players.”
There could be worse things, honestly.
The vision seems to be in place to run the Jays like the big market team they ought to be, and it actually feels like that might be pretty durable for once. We’ll see what the future brings — I’m sure as hell not going to put too much faith in billionare failsons or giant telecoms to do right by anyone but themselves, and they can certainly always do more to pay their talent, particularly in the minor leagues — but compared to a whole lot of other periods in this franchise’s recent history things seem pretty good.
Now just please don’t fuck it up!
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Please let me know when (if) those tracking shares go on sale.