The Successful Investor Hotline – Friday, December 9, 2011

Article Excerpt

BCE INC., $40.74, Toronto symbol BCE, is teaming up with Rogers Communications Inc. (Toronto symbol RCI.B) to buy 75% of Maple Leaf Sports and Entertainment (MLSE). This is the private company that owns several professional sports teams, including the Toronto Maple Leafs (hockey), Toronto Raptors (basketball) and Toronto FC (soccer). MLSE also owns the Air Canada Centre arena in downtown Toronto, as well as specialty TV channels such as Leafs TV. BCE, in combination with the trust fund that manages its employees’ pension plan, will pay a total of $533 million for 37.5% of MLSE. Rogers will also acquire 37.5%. A private investor will own the remaining 25%. The deal should close in mid-2012. Unlike most sports teams, MLSE is profitable. This investment will also guarantee BCE access to live games and other high-demand content for its TV channels, radio stations and web sites. BCE continues to see strong demand for its wireless and high-speed Internet services. Thanks to its improving cash flow,…