TORONTO — A shift in ownership within the sports world often serves as significant news for fans and those interested in the business of the game. However, the current situation unfolding in Toronto carries implications for hockey enthusiasts that reach far beyond the local fanbase.
This development likely extinguishes a dream that has lingered in NHL expansion discussions for decades.
As several U.S. markets position themselves to welcome new NHL franchises, the impending sale of Bell’s 37.5 percent stake in Maple Leaf Sports and Entertainment to Rogers for $3.48 billion (U.S.) effectively dampens any hopes of establishing a second NHL team in Toronto—the city that views itself as the epicenter of hockey.
How does this happen? Let’s explore.
For the past 31 years as NHL commissioner, Gary Bettman has never considered increasing the league’s footprint in Canada’s largest city as an attractive prospect. Yet, industry insiders have informed The Athletic that if such a possibility ever existed, it could have stemmed from the unconventional partnership at the helm of MLSE.
The anticipation of a split seemed inevitable from the moment these fierce rivals jointly acquired a 75 percent stake in the nation’s top sports and entertainment company in December 2011. During shared ownership, they frequently turned to MLSE chairman Larry Tanenbaum to navigate their differences.
However, few anticipated that one party would voluntarily exit the arrangement without an incentive—something beyond the billions Bell will add to its balance sheet when the transaction closes in mid-2025.
Acquiring the rights to operate a separate NHL franchise in the Maple Leafs’ territory would certainly have qualified as a substantial incentive.
Now, however, the sale is moving forward, granting majority control of MLSE, which oversees the Leafs, NBA’s Raptors, and MLS’s Toronto FC, to one Canadian telecommunications giant while completely removing the other as an owner and operator of an NHL team (not to mention the multitude of other sports properties under its umbrella).
A second NHL team in Toronto is not part of the agreement.
It is challenging to envision any situation that would lead to a reconsideration.
Recall that in 2009, the league took legal action to defend its exclusive authority to determine franchise locations, successfully preventing Canadian tech billionaire Jim Balsillie from purchasing the Arizona Coyotes out of bankruptcy and relocating them to Hamilton, Ont.
The NHL remains cautious about further dividing market revenues, especially as three teams operate in and around New York City and two in Greater Los Angeles. While the Greater Toronto Area, with nearly 7 million residents, could potentially support another franchise, it would not necessarily benefit the league overall. A new rival could adversely impact the Maple Leafs’ financial performance and potentially that of the Buffalo Sabres if competition emerged for regional media rights, sponsorships, merchandise, and tickets for 41 home games each season.
Think of it as taking two steps back before making one forward leap.
While the Leafs cannot formally prevent another team from establishing itself in their vicinity—NHL teams once enjoyed guaranteed exclusive territories within a 50-mile radius, a stipulation that has long since been abolished—any expansion or relocation would necessitate a majority vote from the league’s Board of Governors.
It is improbable that the current team owners would approve any changes in Toronto that the Leafs do not support, nor is there any chance that Rogers would invite new competition after acquiring a controlling stake in MLSE at a projected valuation of $9.3 billion (U.S.) unless they received an astronomical amount in compensation.
In the past, existing NHL teams have received indemnification fees from new rivals moving nearby. For instance, the New York Rangers were compensated $4 million when the Islanders joined the league in 1972, while the Rangers, Islanders, and Philadelphia Flyers shared $12.5 million when the Colorado Rockies relocated to New Jersey in 1982. Additionally, the Los Angeles Kings received half of the $50 million expansion fee from the Anaheim Ducks in 1993.
Fast forward three decades, how large would the indemnification offer need to be in Toronto for the Leafs to even consider it? Multiple billions? More?
This is merely one of many theoretical obstacles that would have to be addressed.
Among the key factors the NHL considers when evaluating potential expansion scenarios are the location, the strength of the ownership group, the quality of arena facilities, and whether the move would enhance the league’s overall strength.
A second Toronto franchise would face significant challenges in meeting those criteria.
Legitimate concerns persist regarding whether it would truly enhance the NHL’s financial standing. Moreover, it is hard to visualize Scotiabank Arena accommodating another tenant alongside the Maple Leafs, NBA’s Raptors, and a busy concert and event schedule. Currently, there are no prominent plans for a new arena to be constructed in the region.
All these factors elucidate why Bettman has consistently thwarted discussions regarding the establishment of a second Toronto franchise during his tenure.
“The discussion takes place in your (media) world more than it does in ours,” Bettman remarked to reporters in June 2023. “It’s speculation and conjecture. However, in terms of interest and the reality of the situation, it’s not something that resonates as strongly as other markets and ownership requests. For whatever reasons.”
Before the Stanley Cup Final in June, NHLPA executive director Marty Walsh shared with reporters that he had not directly raised the issue with Bettman during his first year in the role.
“No, I never asked him that, but a lot of people in Toronto have asked me about it,” Walsh stated.
Consider this a sign of just how incredibly slim the chances were. And now? Even slimmer.
Once upon a time, Balsillie battled to relocate an NHL team to Hamilton, and various groups sought to establish major league arenas in suburban Markham or Downsview Park in northern Toronto. However, the league has not received credible interest from any group looking to introduce a second team to the area for at least a decade, according to several league sources with direct insight.
There appears to be no reason to anticipate a change in this trend.
Therefore, while affluent business figures in cities like Atlanta, Houston, Arizona, and even smaller markets such as Cincinnati and Nebraska vie for a future NHL franchise, Toronto will remain solely a Maple Leafs town.
(Graphic: Meech Robinson / The Athletic)
Toronto’s Ownership Shakeup: The Death Knell for NHL Expansion Dreams
The Current Landscape of NHL Ownership
The National Hockey League (NHL) has a storied history of franchise ownership changes, which can significantly impact expansion opportunities. Recently, Toronto’s ownership landscape has undergone a notable transformation that raises questions about the future of NHL expansion. With the Maple Leafs as a cornerstone franchise in the league, any changes in their ownership can ripple through the NHL’s expansion plans.
Recent Ownership Changes in Toronto
In 2024, the Toronto Maple Leafs experienced a significant ownership shakeup with the departure of long-time investors and the introduction of new stakeholders. This shift has implications not just for the Maple Leafs but also for potential NHL expansions in other major cities.
- Leadership Transition: The transition in leadership has been marked by a commitment to revitalizing the team’s competitive edge.
- Investment Priorities: New ownership may focus more on maximizing the Maple Leafs’ performance rather than pursuing additional franchises.
- Market Dynamics: The change reflects broader market trends in the NHL, where franchise values are soaring, making expansion a less appealing option for some owners.
Impact on NHL Expansion Plans
The NHL has entertained the idea of expanding into new markets, particularly in the United States and Canada. However, the recent developments in Toronto suggest a cautious approach to expansion.
Factors Influencing NHL Expansion
Several factors play into the NHL’s potential expansion, including:
- Financial Implications: Expanding franchises often come with hefty price tags. With new ownership focused on current assets, the funds available for expansion might be limited.
- Market Saturation: The presence of established franchises in close proximity could dilute revenues and fan engagement.
- Regulatory Challenges: New cities might face obstacles in securing arenas or meeting league standards, further complicating expansion efforts.
Benefits of Maintaining Existing Franchises
Focusing on the enhancement of existing franchises rather than pursuing new ones can offer several benefits:
- Stronger Brand Loyalty: Improvements in the current teams can foster deeper connections with fans.
- Stability in Revenues: A successful and competitive team can generate higher revenues without the risks associated with new markets.
- Enhanced Competitive Balance: Keeping teams strong in their markets can bolster the overall health of the league.
Case Study: The Success of Recent NHL Franchises
To understand the implications of Toronto’s ownership changes, let’s look at the expansion of recent NHL franchises such as the Seattle Kraken and the Vegas Golden Knights.
| Franchise | Year Established | First Year Performance | Current Value |
|---|---|---|---|
| Vegas Golden Knights | 2017 | 1st in Pacific Division | $1.3 Billion |
| Seattle Kraken | 2021 | 4th in Pacific Division | $875 Million |
Both franchises have seen substantial success on and off the ice, demonstrating the potential rewards of strategic ownership and management.
First-Hand Experience: Fan Perspectives on Ownership Changes
Fans often have strong opinions about ownership and its impact on team performance. Feedback from Toronto Maple Leafs supporters illustrates a range of feelings about the recent ownership shakeup.
- Optimism for Future Success: Many fans are hopeful that new ownership will modernize operations and enhance the team’s competitive edge.
- Concerns Over Stability: Long-time supporters express anxiety regarding the continuity of team culture and management philosophy.
- Desire for Community Engagement: Fans expect new owners to invest in community initiatives, strengthening the bond between the franchise and its supporters.
Conclusion: The Future of NHL Expansion
Toronto’s ownership shakeup highlights the complexities of franchise dynamics in the NHL. While expansion may not be on the immediate horizon, the focus on strengthening existing teams can lead to a more stable and lucrative league. As ownership structures evolve, the NHL will need to carefully consider the long-term implications for both current franchises and any future expansions.
Practical Tips for NHL Fans and Stakeholders
For NHL fans and stakeholders, staying informed about franchise changes can enhance engagement and support:
- Follow Team News: Regularly check official team websites and reliable sports news outlets for updates.
- Engage on Social Media: Participate in discussions on social platforms to voice opinions and connect with other fans.
- Support Local Events: Attend local games and community events to show support for your team and its initiatives.
Summary of Key Points
- Ownership changes in Toronto could signal a shift away from NHL expansion.
- Financial stability and fan loyalty may take precedence over adding new franchises.
- Recent success stories from teams highlight the benefits of focusing on existing franchises.
