Rogers Communications says there is "no change to our current relationship" with the company that owns the Toronto Maple Leafs and several other major-league sports franchises.
The comment comes amid reports that the Toronto-based company — already the owner of the Toronto Blue Jays — is in high-level talks to acquire control of Maple Leaf Sports and Entertainment in what's rumoured to be a $1.3-billion deal.
The reputed seller — the Ontario Teachers Pension Plan Board — is the majority partner in MLSE, which owns not only the National Hockey League's Leafs and the Marlies of the American Hockey League but also the Toronto Raptors basketball team and Toronto FC soccer team.
Richard Peddie, MLSE's chief executive officer, said on CBC's World Report that it would be up to the Ontario Teachers' Pension Plan to decide whether to sell the company.
MLSE ownership breakdown
66%: Ontario Teachers Pension Plan
20.5%: Kilmer Sports Inc.
13.5%: TD Capital
"That would be a shareholders' matter … I have no knowledge of any negotiations or any discussions on that matter, so I'm completely in the dark," Peddie said. "But you know the Teachers could do that. They own the majority share, but that would be their call."
Besides owning Canada's largest wireless phone business and one of the country's biggest cable companies, Rogers also has a media business that owns the Sportsnet specialty cable channels and the Rogers Centre stadium.
Rogers has been pursuing an integrated marketing strategy for years, using its various businesses to cross-promote each other — encouraging sports fans, for instance, to follow their teams over Rogers internet, TV or radio affiliates.
"We have a successful, long-standing sponsorship and broadcasting arrangement with MLSE," Rogers said in a statement Wednesday.
"Sports is an important part of Rogers and we're always in discussions with companies to enhance the sports content we offer our customers."
"There's no change to our current relationship with MLSE. As to the specifics, we don't comment on rumour or speculation."
A spokeswoman for Teachers said it also wouldn't comment.
"It's our policy to neither confirm nor deny such stories," said OTPP's Deborah Allan.
Real estate wouldn't be part of sale: source
Citing anonymous sources, the Toronto Star reported that the sale would include the sports teams, Leafs TV and Raptors TV, but not MLSE's real estate holdings.
The Ontario Teachers Pension Plan Board owns about 66 per cent of MLSE. Kilmer Sports, which is controlled by Toronto businessman Larry Tanenbaum, holds about 20.5 per cent of the company and TD Capital holds the remaining 13.5 per cent.
Dvai Ghose, an analyst at Canaccord Genuity who covers the telecom industry, issued a note Wednesday saying that while Rogers is downplaying the story, it wouldn't be surprising if it came to pass.
In addition to Rogers' interest in sports, he wrote, OTPP is a financial investor — not a strategic investor — in Maple Leaf Sports and Entertainment "and so we assume that it will look to monetize its MLSE stake at some point."
Ghose added that Rogers could easily finance such a purchase, since it generates nearly $2 billion in cash annually from its business and had $344 million of cash at the end of September — as well as up to $2.2 billion of available credit.
However, he wrote, "if such a deal ever takes place, it is unlikely to be accretive [add to earnings] and may not be viewed positively by the market."
Rogers B shares traded Tuesday at $36.27, down two cents, on the Toronto Stock Exchange.