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The Ontario Teachers' Pension Plan is moving aggressively to tidy up the ownership of Maple Leaf Sports and Entertainment Ltd., a bid to smooth the way for a sale of the prized hockey and basketball empire.‬

‪The pension fund, which already holds two-thirds of MLSE, struck a deal to buy Toronto-Dominion Bank's 13.46-per-cent stake in the company, which boasts ownership of the Toronto Maple Leafs, Toronto Raptors, Toronto FC and the Air Canada Centre.

The deal will simplify an auction process that has been under way since March for the Teachers stake in MLSE, by taking TD out of the mix as a decision maker.

But it does not change the fact that Larry Tanenbaum, who owns the second-biggest interest in MLSE, is still the kingmaker in this process. And Mr. Tanenbaum is in no rush to make a decision, according to sources.

Mr. Tanenbaum met with a private equity official from Teachers in Toronto Tuesday afternoon, after learning that the pension fund had reached an agreement to buy TD's stake in MLSE, sources said.

Mr. Tanenbaum now has the right to buy one-fifth of TD's stake because of a shareholders' agreement in place between each of the owners of the sports company.

Tuesday's developments don't change the situation for Mr. Tanenbaum, who is sitting back and waiting to see what bids ultimately emerge for the entire Teachers stake in MLSE.

With TD's 13.46-per-cent interest in MLSE, Teachers would hold 79.53 per cent. If Mr. Tanenbaum buys in, Teachers would hold 76.35 per cent.

If Teachers does ultimately line up a buyer for its share, Mr. Tanenbaum has a right of first refusal on that, as well.

The sales process is chugging along slowly and it's still not clear that there will be a buyer.

Teachers' put its stake on the block two months ago after receiving expressions of interest from potential acquirers, but it intends to hold on to the stake if the ultimate bids don't live up to its expectations.

"Last year, a number of people whispered interesting numbers in our ear," chief executive officer Jim Leech said Tuesday at the Bloomberg Canada Economic Summit in Toronto. "And so we put a process in place. We'll see if those whispers turn into reality. If they don't, it's business as usual – it's a great asset."

Sources familiar with the deal said TD is protected if Teachers turns around and sells its stake for a significantly higher price. In exchange for getting TD to sell its stake early, the pension fund has agreed to compensate the bank if the price jumps in coming months, a source said.

"We've been a financial investor in MLSE for quite some time," a spokesman for TD said. "As with any financial investment, we are prepared to exit at the right time and on the right terms. We believe this proposed transaction affords us that opportunity."

Morgan Stanley, which is advising on the sale process, has not yet opened up the books to potential buyers. In part, it wants to take the process slowly in order to see which legitimate buyers step forward, while not rushing on a sale and prompting bidders with no credibility to emerge with long-shot offers, according to a source.

But Mr. Leech suggested that a decision on whether to sell is still possible this summer.

He added that the deal with TD is subject to league approvals.

In the meantime, prospective buyers are working on Mr. Tanenbaum.

"There is a lot of money out there that's been talking to Larry in the past month, not all of it on the same deal; there are two or three deals out there," said one Bay Street source. "Any smart businessman is going to come to Larry now and ask to come into his house."

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