GARRIOCH: Michael Andlauer reaches deal in principle to buy Ottawa Senators - Ottawa Sun

The Canadian Tire Centre and the Senators went up for sale in November. Photo by Brian Thompson /Brian Thompson/The Expositor

The dawn of a new era is on the way for the Ottawa Senators.

League sources told Postmedia Tuesday Toronto billionaire Michael Andlauer’s bid, which believed to be worth $950 million (all figures U.S.), has been moved to the front of the line by New York-based banker Galatioto Sports Partners (GSP) and the Melnyk estate.

The deal was confirmed by the club just after 10 a.m.

Andlauer has reached an agreement in principle to purchase the Senators. That means his offer has been elevated to the next stage of due diligence and work will now ramp up with the National Hockey League to try to close the deal.

“My family and I are very excited to be a part of the Ottawa Senators Hockey Club. I believe that the Senators’ fanbase is one of the most passionate in the league and I’m excited to take the franchise’s success both on and off the ice to the next level,” Andlauer said in a statement.

The short and long-term future of the team is incredibly bright, and I look forward to getting to know the team, the fanbase and the community.”

The Senators are excited with Andlauer’s arrival.

“We are very pleased to announce that we have entered into an agreement to sell controlling interest of the Senators to Michael Andlauer. Michael represents everything we could have hoped to find coming into this process – a passionate owner who is committed to Ottawa,” said Senators’ governor Sheldon Plener.

“I want to thank Anna and Olivia Melnyk for their dedication and support to the board of directors and executors of the estate during this process. We would also like to recognize the ongoing efforts of the National Hockey League and the outstanding work of Galatioto Sports Partners.

“We believe it is a momentous day for the National Capital Region.”

Andlauer’s partners in the deal include local businessman Jeff York, a partner in Farmboy, and his 20-plus investors. Sources told Postmedia Tuesday morning the Malhotra family, the owners of Ottawa home builder Claridge Homes, are also partners with Andlauer.

With an agreement in principle signed with Andlauer, it will need approval from NHL commissioner Gary Bettman and the league’s executive board. That group met last Wednesday but could reconvene if necessary.

From there, the agreement will be passed onto the board of governors and though they’re scheduled to meet in New York June 22, it might be a stretch to have the deal approved by then.

Andlauer’s current status ahead of the other three bids has resulted in the total elimination of Jeffrey and Michael Kimel or Los Angeles producer Neko Sparks, but the status of both is hanging by a thread.

As Postmedia first reported at the deadline May 15 for binding bids, Andlauer along with Toronto billionaire Steve Apostolopoulos along with Jeffrey and Michael Kimel of Harlo Capital and Sparks, submitted binding bids.

If the club sells for $1 billion that’s the highest price a franchise has sold for in NHL history. The late Eugene Melnyk purchased the Senators out of bankruptcy in 2003 and under the terms of this sale the club must remain in Ottawa.

Sources say the league liked Andlauer’s vision for the city, his plans for the club’s brand and the ability of his family to try to help bring a Stanley Cup to Ottawa.

The four bids ranged from somewhere between $850 million and $1 billion (all figures U.S.). Since GSP received those bids, they’ve worked with the groups involved to get the best price possible for the National Hockey League team.

Apostolopoulos walked away Friday out of frustration with the process and we believe Andlauer then pushed for a deal to get done or he’d do the same.

Sources say Andlauer has the wherewithal to do this deal and is determined to build a winner in Ottawa.

It’s believed, Anna and Olivia, will retain as much as 10% stake once the deal is approved by the NHL.

A part-owner of the Montreal Canadiens, Andlauer wanted to win this deal badly, and had to raise his bid to make it happen. He will also have to sell his share in the Habs.

Now the work on closing the deal will heat up. That won’t happen in nearly enough time for the NHL’s board of governors meeting, which is set for later this month in New York.

Bettman will give the governors an update on the sale, providing details of the agreement in principle and what it took to get there. The sale needs two-thirds approval of the board.

The NHL will give the board as much detail as it can so that, when it comes time to vote, the governors are informed enough to rubber-stamp the decision after being updated on any changes that may have happened during closing.

The Melnyk estate announced on Nov. 7 the club was officially up for sale and that GSP had been retained to handle the deal. The only stipulation was a “condition of any sale will be that the team remains in Ottawa.”

That came after Eugene Melnyk’s passing in March 2022. The franchise is part of the massive estate Melnyk left to Anna and Olivia, and it has been operating business as usual since his death after a lengthy illness.

Sources say Andlauer supports the idea of a new downtown arena, but hasn’t decided whether that should be at LeBreton Flats or somewhere closer to downtown.

Since the Senators won preferred-bidder status from the National Capital Commission in June 2022 to build a rink on a seven-acre parcel of land at LeBreton Flats, we’ve insisted the city will have to play a role to make the project work.

That’s why the seven groups that visited the city during Phase 2 of the process in late-March and early-April met with NCC CEO Tobi Nussbaum to discuss the project.

Nussbaum has said there is room for flexibility on the size of the parcel of land, but Ottawa Mayor Mark Sutcliffe has suggested options publicly that have piqued the interest of some of the bidders.

The 14 acres at Bayview Yards is the most interesting parcel that Sutcliffe has said the city might be willing to talk about and several of the bidders are interested in that location.

Sutcliffe didn’t mention the DND headquarters near the Rideau Centre, but some of the groups have studied that option.

bgarrioch@postmedia.com

twitter.com/sungarrioch

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2023-06-13 12:56:34Z
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