March 23, 2023
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GARRIOCH: Toronto-based investors have expressed interest in buying Senators

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Potential bidders have already put their names in the ring to buy the Ottawa Senators.

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League sources say there will be several groups interested in buying the Senators once they are officially put up for sale by Anna and Olivia Melnyk in the next month or so.

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The expectation is that the family will keep a legacy out of respect for their late father Eugene Melnyk, who passed away in March after a long illness.

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While it will likely be a month before New York-based sports banker Galatioti Sports Partners signs the final paperwork on the senators and then officially speaks to potential candidates, a league executive told the newspaper “there will be several groups” who make a pitch.

NHL Commissioner Gary Bettman might already have someone in mind, but the organization needs to go through the due diligence process and make sure there’s someone willing to put their money in their hands once they’ve expressed an interest.

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Here are some names that this newspaper thinks you should keep an eye on in the coming months:

Sources say Jeffrey and Michael Kimel, who previously owned a minority interest in the Pittsburgh Penguins before they were sold to Fenway Sports Group last year, have already expressed interest in buying the Senators and a stake in the LeBreton Flats project.

The Toronto-based brothers are on the board of directors of Harlo Financial Group. The company is invested in real estate, wealth management and the entertainment industry. Michael Kimel is the leader of the Chase Hospitality Group.

Michael Kimel recently founded OverActive Media, which invests in esports, and he also served on the Penguins’ Management Committee.

The Kimel family has the financial resources to make this happen and the knowledge to help build LeBreton, but they are hardly alone on this front, which is why there is a bidding process.

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Another name speculated about is Toronto billionaire Michael Andlauer.

The owner of the OHL’s Hamilton Bulldogs also has a 20% interest in the Montreal Canadiens. There has always been speculation that he wants control of his own NHL team. He is also highly respected by Bettman and Deputy Commissioner Bill Daly.

The owner of the Andlauer Group, which owns transportation and logistics businesses in Canada, may have violated the Ottawa franchise in the past.

Of course, Montreal-based Power Corp billionaire Andre Desmarais, who had a connection to the other group that bid for LeBreton Flats in 2016, might as well dip his toe in the water.

He is close friends with Bettman and has previously expressed interest in buying the Senators.

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While we’ve heard local groups are interested, those who know the inner workings of the league believe no one in Ottawa is capable of pulling off a deal of this size alone, meaning they would have to be part of a larger one be group.

This will be a massive transaction that could range from $700 million to $1 billion (all figures in US) once the deal closes. The Penguins recently sold for $900 million and the Nashville Predators are close to a $775 million sale.

You’ll be hearing a lot of speculation about potential local buyers in the coming months. While Minto’s Roger Greenberg has stated publicly that he would like to be part of a group to buy the team, it has to be one with big bucks behind it.

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A league executive told this newspaper on Wednesday he believes the Senators’ next owner will be based in either Toronto or the United States. Bettman wants to keep this team in Ottawa, especially with the potential for a downtown arena on the horizon.

Why is this happening now?

The clock is ticking in the 15 month window to closing a lease at LeBreton Flats. Even if the Melnyk family wanted to retain ownership of the franchise, they had to bring in a partner to help them fund the new ice rink, located 10 minutes west of downtown.

A new owner could also come from among the partners involved in the LeBreton acquisition. These include Sterling Project Development, Populous, Tipping Point Sports and Live Nation.

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Making this decision now will ensure that the new owner can be involved in the negotiation process with the National Capital Commission before it is complete. Anthony LeBlanc, the club’s President of Business Operations, and Erin Crowe, Chief Financial Officer, continue to conduct these discussions.

Business will continue as usual for the front office as work needs to continue through September 2023 to secure a lease with NCC officers.

As we’ve noted in this room, newly elected Mayor Mark Sutclliffe can expect a call from Crowe and LeBlanc regarding LeBreton’s bid. The city of Ottawa will have a role in the ice rink, and senators could model the project on Edmonton’s Ice District.

In this scenario, the city and province of Alberta both helped fund the arena, and Sutcliffe seems at least willing to listen to that scenario.

Stay tuned, the next eight to ten months will be interesting.

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