This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Who Is Going to Buy Madison Square Garden?

NEW YORK (TheStreet) -- In a Tuesday article on TheStreet, Jonathan Yates argues Microsoft (MSFT - Get Report) could "out-cool" Apple (AAPL - Get Report) if it bought Madison Square Garden (MSG).

While I thought Yates made a good case that Microsoft buying MSG pays for itself in arena naming rights/brand placement alone, I don't buy much else he had to say other than -- broadly speaking -- somebody absolutely should make a move on the company now. That's why I ask Who is going to buy MSG? because, by now, it really should be no brainer type stuff.

MSG is more than Madison Square Garden arena. The company owns several other venues, including Manhattan's Radio City Music Hall and the recently-acquired and grand-reopened Great Western Forum in Los Angeles (Inglewood to be exact). It also owns the regional Madison Square Garden Network(s), which broadcast key New York-area professional sports. MSG doesn't just own the venues and broadcast the games; it owns major teams, such as the New York Knicks and New York Rangers.

If I'm right and, to some extent, American media and telecommunications companies envy and would like to duplicate (as much as regulators will allow) the ubiquitous domination Rogers Communications (RCI - Get Report) and BCE, Inc. (BCE - Get Report) (formerly Bell Canada) pull off north of the border, MSG becomes the obvious target. You can get background on Rogers and Bell HERE. I've actually been following the company since my Seeking Alpha days in 2011.

The thought trajectory of MSG as a no-brainer takeover target doesn't lead to Microsoft. It wouldn't make Microsoft "cooler" than Apple. It would just make Microsoft less focused than it already is. That's just what Satya Nadella needs as he cleans up Steve Ballmer's mess -- a few professional sports franchises, venues that host events practically every night of the week and a massive regional media operation. More moving parts that don't logically fit into whatever Microsoft's mix is.

That said, if U.S. telcos and big media companies are smart they go after MSG hard. A bidding war for MSG is long overdue. Twenty-First Century Fox's (FOXA - Get Report) majority stake in the New York Yankees YES network lends further support to the value of MSG's assets. Heck, if I'm Rupert Murdoch, I kick this thing off by knocking on MSG's as well as the Yankees' door.

Also consider Comcast (CMCSA - Get Report). Via its media properties (including NBCUniversal), cable company (now one with Time Warner Cable (TWC)) and ownership of the Philadelphia Flyers, they're the closest American version of Canada's Rogers and Bell. For goodness sake, it would be worth it for Comcast to divest the Flyers and make a go at MSG.

Beyond Fox and Comcast, AT&T (T - Get Report) and Verizon (VZ - Get Report) make obvious sense vis-a-vis MSG. Everything MSG does fits perfectly with the going model for being a modern day, digital era media and telecommunication company.

It might sound sexy for a tech company such as Microsoft to take a shot, but there's not nearly enough synergy. If somebody ends up with MSG, they'll have made the move for one purpose -- to build an empire. That's what Comcast, Fox, AT&T and Verizon are all in the process or should be in the process of doing. With MSG, each company either establishes a presence in part of the country where they do not have one or extends their reach where it already exists. And they do it with strong franchises that, despite geography, pack not only local and regional, but national appeal.

--Written by Rocco Pendola in Santa Monica, Calif.

Vice Media's Shane Smith Is the Future That Time Warner Wants to Own

What Becomes of Pandora If It Doesn't Get Bought Out?

GM Proves Bankruptcy Is No Cure for Sick Culture

Rocco Pendola is a full-time columnist for TheStreet. He lives in Santa Monica. Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $93.64 -0.11%
BCE $46.78 -0.28%
CMCSA $61.23 0.77%
FOXA $30.36 0.33%
MSFT $50.61 1.48%


Chart of I:DJI
DOW 17,891.16 +117.52 0.66%
S&P 500 2,081.43 +16.13 0.78%
NASDAQ 4,817.5940 +42.2360 0.88%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs