Bon Jovi/Toronto group on ‘life support’ and mulling whether to proceed in Buffalo Bills sale process, sources say

Jon Bon Jovi and his Toronto backers are reassessing whether even to continue in their pursuit of the Buffalo Bills, Sun Media has learned.

Their bid has been on the rocks for weeks, and no one within the group is optimistic they’ll wind up buying the NFL team, according to two sources in the position to know.

The group cancelled a scheduled tour of Ralph Wilson Stadium on Wednesday.

“They’re hanging on by the skin of their teeth,” one source said. “The bid’s on life support.”

It has nothing to do with the announced departure Thursday of CEO Tim Leiweke from Maple Leaf Sports & Entertainment, whose role in the bid has been overstated (most often by Leiweke himself).

But it has everything to do with (1) the group’s limited bidding power with Bon Jovi in the lead, and (2) lingering doubts about whether the trust would sell the club to a group that continues to refuse to commit to keeping the Bills in Western New York long-term.

A source said the Toronto group bowed out of a planned tour of the Bills’ stadium in Orchard Park on Wednesday, and has no plans to reschedule it. The tour is a scheduled part of the due diligence process for all finalists, in what Morgan Stanley — the investment bank conducting the sale for the trust of founding Bills owner late Ralph Wilson — calls the “final phase.”

There are three other known finalists: multi-billionaires Terry Pegula, Donald Trump and Tom Golisano.

The Toronto bid group comprises rocker Bon Jovi (as prospective controlling owner, with about a 30% stake) and his Toronto background investors, each with about 35% shares: MLSE chairman Larry Tanenbaum and Edward Rogers and his family, whose trust runs Canada’s Rogers Communication Inc. empire.

Sources say the trio are taking the next week or so to assess where their bid is at, and to discuss what they could possibly do at this stage to mount a formidable, effective bid.

Morgan Stanley tried to help in that regard, sources said Monday, in suggesting last week that Bon Jovi approach Buffalo legend Jim Kelly, the franchise’s Hall of Fame quarterback, about joining their bid. Kelly and his investment partner, Jeffrey Gundlach, hope to latch on as minority investors with another bid.

Kelly and Bon Jovi met, but Kelly rebuffed the rocker’s request over concerns his group would eventually relocate the team to Toronto, Tim Graham of the Buffalo News reported on Sunday.

As constituted, the Toronto group is limited financially by the amount of cash the rocker can pull together to meet the 30% controlling-owner threshold that the NFL demands.

The group’s maximum bid — which sources say is somewhere between $1 billion and $1.2 billion — isn’t nearly enough to compete with Mr. Money Bags, Pegula, the cash-flush multi-billionaire who owns the NHL’s Buffalo Sabres. And Bon Jovi, Tanenbaum and Rogers know it.

Remember, their group already was dead once — for almost a week, after submitting an uncompetitively low first bid on July 29. Even after being allowed to resubmit a higher opening, non-binding bid, and being asked to more clearly express a non-relocation intention, it wasn’t until the Aug. 9-10 weekend that Morgan Stanley allowed the group to enter the sale’s final phase.

A week ago Tuesday, the group had its first face-to-face meeting in Manhattan with sale principals: members of the trust, senior executives of the Bills, Morgan Stanley and the trust’s legal adviser Proskauer Rose. It was a desultory meeting that further lowered the Toronto trio’s hopes.

As Sun Media reported on Monday of this week, do not interpret Morgan Stanley’s match-making attempt with Kelly as any expression of favouritism toward the Bon Jovi/Toronto bid.

The banker merely had this hope: to assuage Buffalonians’ concerns about the Toronto group’s suspected relocation intentions by teaming it with Mr. Bills-Can’t-Move himself, so as to convince other bidders — especially Pegula — that the beleaguered group is indeed a viable threat to win the bidding.

Right now it is not.

One source said that barring a significant development, or reformation of the group, the Toronto trio is likelier to disband than submit a binding, definitive bid early next month along with the other finalists.


Bon Jovi reached out to Jim Kelly at the suggestion of investment bank conducting sale of Bills, source says

Jon Bon Jovi reached out to Hall of Fame quarterback Jim Kelly at the suggestion of the investment bank running the Buffalo Bills sale, Sun Media has learned.

A source in the position to know on Monday morning said Morgan Stanley requested that the front man of the Toronto group attempting to buy the NFL team meet with the former Bills superstar, as a means of making their bid “more Buffalo friendly.”

Kelly is as beloved and iconic a former NFLer as lives in any league market. For years he has said he would do all in his might, including joining a bid group, to keep the Bills in Western New York following the death of founding owner Ralph Wilson. Wilson died in March at age 95.

Kelly already has a prospective bid partner — bond investor Jeffrey Gundlach, who would provide all of the duo’s financing. But Gundlach is not wealthy enough to bid alone so he and Kelly are hoping to obtain an ownership share either with an existing bidder or in a yet-to-be-formed bid group.

Tim Graham of the Buffalo News reported Sunday night that Kelly met face-to-face with Bon Jovi last week, but Kelly and Gundlach rejected the famous musician’s partnership proposal because of “lingering concerns” over the Toronto group’s commitment to keeping the Bills in Western New York.

It was for that same reason, as well an uncompetitively low non-binding first bid, that the Wilson trust and Morgan Stanley initially rejected the Toronto group as a finalist.

A strict non-relocation agreement with Erie County and the state of New York prevents the Bills from being sold to a new owner “who, to the Bills’ knowledge, has an intention to relocate, transfer or otherwise move the team” before 2023. Until June, the Toronto group had not so quietly intended to relocate the Bills to Canada’s largest city at the earliest opportunity. Good luck finding a single soul who believes their belated summertime about-face is sincere.

Yet the bank two weeks ago allowed Bon Jovi’s group to resubmit its bid. Despite still not clearly expressing an intention to keep the Bills in Buffalo long-term, the group was informed by Morgan Stanley on Aug. 9-10 weekend it had advanced to the sale’s final phase.

Do not interpret Morgan Stanley’s match-making attempt with Kelly as any expression of favouritism toward the Bon Jovi/Toronto bid, the source said.

The banker had this hope: to assuage Buffalonians’ concerns about the Toronto group’s suspected relocation intentions by teaming it with Mr. Bills-Can’t-Move himself, so as to convince other bidders — especially Terry Pegula — that the beleaguered group is indeed a viable threat to win the auction.

Pegula, the cash-flush multi-billionaire with strong local ties, is widely seen as the clear favourite to wind up with the team.

To drive up the final price tag for Pegula or whoever should win the bidding, there need to be as many threats in the mix as possible.

The other two known finalist bidders are multi-billionaires Donald Trump and Tom Golisano, both of whom like Pegula have clearly expressed an intention to keep the Bills in Buffalo.

Adam Benigni of Buffalo’s WGRZ-TV reported on Saturday that Golisano and Kelly have had talks about teaming up.

It is believed Golisano had his meeting on Monday in Manhattan with all the Bills sale principals. The Toronto group had its so-called “management presentation” last Tuesday, Pegula last Wednesday. Trump had his two weeks ago in the Detroit area.

Finalists are expected to submit binding, definitive offers by the end of next week.

Antsy Bon Jovi indeed reaches out to Jim Kelly on Bills bid, shedding more uncertainty on fate of beleaguered Toronto group

Already there had been plenty of buzz this summer that Jon Bon Jovi, at various times, had looked into abandoning his Toronto partners — to instead bid on the Buffalo Bills with American investors.

The latest whopper to hit the rumour mill turns out to be true. That the front man of the Toronto bid group held discussions this past week with Hall of Fame quarterback Jim Kelly about joining forces.

What that might mean for his Toronto investors remained unclear Sunday night.

Tipped about it by two sources on Saturday morning, Sun Media can confirm via multiple sources the news that Tim Graham of the Buffalo News was first to confirm late Saturday afternoon, that arguably the most admired man in Western New York, Kelly, has at minimum entertained the notion of teaming on a Bills bid with the most hated man in the region, Bon Jovi.

Many in the Buffalo area still refuse to believe it.

Kelly’s wife Jill tweeted this out soon after Graham’s report hit the web: “To think that anyone would think for a minute that Jim would ever link up with ownership that would move our BELOVED BILLS is ludicrous.”

That statement, coupled with the fact that Kelly by early Sunday night still had not publicly denied talking to Bon Jovi, opens a few compelling lanes of conjecture as to what’s really going on here.

Maybe Kelly already has decided against the partnership.

Maybe Kelly is convinced the rocker and his Toronto investors are sincere in wanting now to keep the Bills in Buffalo, although he’d be the first in the region to believe it.

Or maybe Kelly was told by Bon Jovi he’s on his own now. Indeed for his part, maybe Bon Jovi was investigating whether Kelly’s newly secured partner — in joining forces with another bidder or investing in a new bid group entirely, bond investor Jeffrey Gundlach — is rich enough to provide the remaining 70%, after Bon Jovi’s 30% controlling-partner share. In other words, maybe Bon Jovi wanted to know whether he could replace his current financial back-fillers, MLSE chairman Larry Tanenbaum and the Rogers family, with Gundlach. In that scenario Kelly would not be allying himself with any Toronto partners, see.

As Graham observed, however, the fact Kelly and Bon Jovi have considered the unlikely liaison at all speaks to how desperate each has become to grab a share of NFL ownership, and with this team — the rocker as controlling partner, the ex-NFLer as a gifted small-slice partner.

A number of other vital points remained unclear on Sunday evening:

1. Whether Bon Jovi had received permission from the transaction team conducting the sale of the Bills — investment bank Morgan Stanley and law firm Proskauer Rose — to talk with Kelly in the first place. The strict non-disclosure agreement signed by all potential bidders prohibits such discourse.

2. Whether Bon Jovi had informed Tanenbaum and Edward Rogers (point person for the Rogers family) before reaching out to Kelly.

3. Whether Tanenbaum and Rogers would even be willing to surrender portions of their roughly 35% investment stakes in the bid to accommodate Gundlach/Kelly.

It’s telling that Bon Jovi reached out to Kelly within days, or even hours, of his group’s unpromising, desultory official meeting on Tuesday in Manhattan with the sellers: the late Ralph Wilson’s trust, Morgan Stanley and Proskauer Rose.

That Bon Jovi did this lends enough credibility to finally report the many rumours and insider tips QMI Agency had heard (and not reported) since June: that Bon Jovi at various times had been looking to latch on with other bid partners — either to replace his Toronto investors or to augment them.

In early July, two credible, reliable sources independent of each other told me they’d heard that Bon Jovi, alone, had recently approached one or more American-side bidders about perhaps abandoning Tanenbaum (this was before Rogers joined) to join up with one of them instead. Reliable other sources in the position to know, however, flatly denied those rumours. Perhaps because those sources were unaware. The outreaches would have happened at about the time when it dawned on Bon Jovi and Tanenbaum that, in order to get the team, they’d have to do a 180 and tell everyone henceforth their plan is to keep the Bills in Buffalo.

In late July I was told by a Canadian source that Bon Jovi had talked with Western New York developer Scott Congel about adding him and his West Seneca stadium plan to the Toronto group. Didn’t happen. Probably it was that someone put 2 and 2 together and came up with 10, after learning the Toronto group in late July had met with Congel about his stadium plan.

Just this past Wednesday I was told that Bon Jovi was for sure going to dump his Toronto partners to team with Tom Golisano, the former Buffalo Sabres owner and payroll-systems billionaire who finally submitted a bid on the Bills just over a week ago. But someone in the position to know told me that that tip was “complete nonsense. Bon Jovi is tied to (Tanenbaum and the Rogers family). He might prefer other partners at this stage who are not Toronto based, but he is stuck with these guys.”

Stuck indeed, as long as the group exists.

Regardless of any non-disclosure agreement, syndicate bidders in any billion-dollar purchase cannot just up and leave current partners whenever the mood strikes them. Such partners legally attach themselves to one another — weeks, even months, before submitting a first, non-binding bid. That’s one reason they have all those lawyers.

So the Toronto trio are legally bound to one another. The only way Bon Jovi could join with someone else would be with both of his partners’ permission — in other words, if both agreed to dissolve their bid group. Perhaps that’s about to happen.

It became clear in late April that the Bon Jovi/Toronto group would have little chance of winning this auction — mainly because of all those issues surrounding the Bills’ restrictive lease and non-relocation agreement with the county and state at Ralph Wilson Stadium.

Bon Jovi appears to have finally accepted that fate, and is acting on it.

Sense of ‘let’s just get through it’ permeated room when Toronto group finally met with principals selling Bills: sources

No harsh words. No icy stares. No table-pounding. No provocations.

That said, don’t get the idea that when the Bon Jovi/Toronto bid group finally met face-to-face Tuesday in Manhattan with principals selling the Buffalo Bills, it was anything like the ending of The Party, with hippies and suits alike joy-dancing till dawn in a silly sea of bubbles.

Two sources with knowledge of what transpired at Morgan Stanley’s offices on Broadway have told Sun Media the management presentation was drama-free. Purely perfunctory. Matter-of-fact. No emotion.

And permeating the room was an unspoken, shared sense that, yeah, we all have to go through with this, so let’s just get through it.

So they did.

Rocker Jon Bon Jovi, MLSE chairman Larry Tanenbaum and Rogers family rep Edward Rogers elaborated on their ownership plan. Members of the Wilson trust, Bills CEO and president Russ Brandon and key reps from investment bank Morgan Stanley and law firm Proskauer Rose did not excessively question the trio about their non-relocation promise.

In turn, the trust and co. talked up their property, the primary purpose of such formal get-togethers in a pro sports franchise sale.

Not much else. Questions asked and answered. Then thanks for coming, we’ll be in touch, handshakes, out.

The sense of pessimism that had saturated the Toronto bid group two weeks ago — when sources say the trio were informed their initial, non-binding bid fell hundreds of millions of dollars short of the one submitted by Buffalo Sabres owner Terry Pegula — has not dissipated, Sun Media has learned.

Defeat seems more inevitable than ever.

Morgan Stanley allowed the group to rebid last week only if it also provided more convincing assurances it had abandoned its original intention to relocate the franchise to Canada’s largest city. Morgan Stanley requested yet further assurances before advising the group over the weekend it had finally made what the bank calls the “final phase” of the sale.

The ever-growing sense, even within the Toronto group, is that their bid was kept alive merely to create the illusion for Pegula that he’s in a horse race, and to provide the perceived relocation threat needed to convince Pegula and other bidders that the Bills — Buffalo’s Bills — still need saving.

Because of the limited personal wealth of prospective controlling owner Bon Jovi in this billionaires’ game, the Toronto group as constituted can bid only so high — somewhere between $1 billion and $1.2 billion, sources have told Sun Media.

By contrast Pegula, the oil-and-gas multi-billionaire who owns the NHL’s Buffalo Sabres, is presumably able to bid as high as he wants. In cash.

Pegula and celebrity multi-billionaire real-estate mogul Donald Trump are the only other known, confirmed finalist bidders.

Former Sabres owner Tom Golisano, a payroll-systems multi-billionaire, finally submitted his first-round, non-binding bid last week. He is believed to be a finalist as well. Sun Media was told last month that Golisano intended to bid aggressively.

Despite re-opening the first-round bidding process shortly after the July 29 deadline, Morgan Stanley has recruited no other individuals or groups known to have submitted a bid. Golisano had publicly confirmed his intention to bid in June.

Trump’s management presentation occurred last Wednesday in Detroit. Pegula’s is scheduled for this week in New York City, Tim Graham of the Buffalo News reported last week.

It was believed Pegula arrived in the New York area on Wednesday.

Morgan Stanley originally had set aside only last week and this for management presentations, but Graham reported there might be meetings next week as well. Golisano’s management presentation would take place within this time frame.

After a full exchange of detailed financial information with the seller, the above four finalists — and any others Morgan Stanley might yet recruit — are expected to submit binding bids by Labour Day weekend.


Exclusive: Bon Jovi/Toronto group advances to final phase of Buffalo Bills sale, to meet with seller Tuesday in Manhattan

After almost two weeks either on the outs or in limbo, the Bon Jovi/Toronto bid group has been advised it is a finalist in the Buffalo Bills sale, Sun Media learned Monday morning.

The group is scheduled to meet with the seller and its transaction team on Tuesday in Manhattan.

Over the weekend the Toronto group finally was informed its rebid had been accepted, sources say.

Comprising rocker Jon Bon Jovi, MLSE chairman Larry Tanenbaum and the Rogers family, the group last Tuesday had resubmitted its first-round, non-binding bid for the NFL club. The Bills are for sale following the death in March of founding owner Ralph Wilson.

Morgan Stanley, the investment bank conducting the sale for Wilson’s trust, previously had rejected the Toronto trio’s initial non-binding bid — for two reasons.

First, because the bid was uncompetitively low, sources said — less than $900 million (and one source said likely lower than $800 million). Secondly, because too much doubt existed within the trust, Morgan Stanley and the sale’s law firm, Proskauer Rose, regarding the Toronto trio’s newly adopted intention to keep the NFL team in Western New York.

In inviting the Toronto group to resubmit, the trust and its transaction team asked the trio to provide greater assurances it plans to keep the Bills long-term in the Buffalo area, a source said.

Whatever assurances the group resubmitted in last Tuesday’s do-over did not immediately prove satisfactory. The group was asked to “clarify statements,” a source said. By the end of business on Thursday the bid group’s status had remained uncertain.

Bidders are muzzled by a strict non-disclosure agreement.

The Toronto trio joins multi-billionaire solitary bidders Terry Pegula and Donald Trump as known finalists. Tom Golisano, a payroll-systems multi-billionaire who sold the NHL’s Buffalo Sabres to Pegula in 2011, is presumed to already be, or soon become, a fourth finalist.

Trump had his formal meeting with the seller last Wednesday in Detroit. Tim Graham of the Buffalo News reported last week that Pegula’s finalist meeting — formally titled a “management presentation” — was scheduled for this week in New York.

Morgan Stanley re-opened the bidding process after only the Toronto group, Pegula and Trump had submitted non-binding bids by the ostensible July 29 deadline.

The Buffalo News late last week reported the seller was scheduled to hold as many as eight meetings by the end of next week, either with finalists or potential purchasers. It appears the latter include merely minority-stake investors for potential, unformed-as-yet bid groups.

No known new bidder has emerged. Golisano had been expected to bid since May but did not submit his until late last week.

It was widely believed the trust would advance the Toronto group to the final phase of the sale, if only to keep panic in the sales process.

Early last month, Morgan Stanley had set aside last week and this for management presentations with finalists. At this point, the seller is revealing to each finalist much more detailed financial information about the Bills operation, while each finalist is opening wide its own books to Morgan Stanley.

Finalists soon will be asked to submit binding bids, probably before month’s end. The trust and transaction team then will select a preferred buyer and begin purchase negotiations, if this sale follows the usual trajectory. The seller can amend the sale process at any time.