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For sale

Molson to sell controlling interest in Canadiens

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Posted: Tuesday June 27, 2000 05:38 PM

MONTREAL (AP) -- The Montreal Canadiens, one of the most storied teams in all sports, are up for sale.

Molson Inc. said Tuesday it will sell its controlling interest, and keeping the NHL team in Montreal will be a condition of the sale.

"Molson is strongly attached to the Montreal Canadiens hockey club and this has been a very difficult decision for everyone concerned," Molson chairman Eric Molson said.

The company, which has been associated with the Canadiens for 40 years, said the move is part of the company's strategy of concentrating on brewing beer.

SI's Michael Farber The Molson Centre, which was on the market before the team, is expensive and there are various levels of taxation in excess of $10 million (CD). There are 21,273 seats and 130 or so luxury suites that are leased to the max, but they are paid for in Canadian dollars and that creates a problem. So the building is more expensive than they thought it would be -- originally it was designed with an office tower and they had to scrap that -- with debt services and taxes. Molson has also been under pressure. It hasn't been a great stock, it didn't partake in the big boom the last five years. So they're under pressure from shareholders. Prospective buyers? I don't know who Molson is looking for. No one has stepped up to buy the building. Maybe it becomes more advantageous if you get a package deal. But if Molson can't make this work to its satisfaction -- and it's a motherhood issue, beer and hockey -- it really does raise that question.

However, Molson is intent on retaining its link to a team that has won 24 NHL titles and produced such hockey greats as Maurice Richard, Jean Beliveau, Jacques Plante and Guy Lafleur.

But the team has not won a Stanley Cup since 1993 and has missed the playoffs two straight seasons, the first time that has happened since 1921-22.

Molson intends to remain the team's biggest sponsor for at least 20 years, a commitment valued at more than $150 million.

The company said in September it wanted to sell the Molson Centre, where the Canadiens play. Possible buyers of the arena expressed a preference for a transaction that would include the Molson Centre and the Canadiens.

"As a Montreal-based brewer and the No. 1 brewery in Quebec, we want to maintain and even increase our close ties with the Canadiens as the primary corporate partner of the team," Molson said.

"With a new controlling shareholder and the solid commercial support of Molson, the Montreal Canadiens hockey club will be in a better position to rediscover the might and the glory of old times, to the pleasure and delight of hockey fans and of Montrealers in general."

 

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