Activision Blizzard is undergoing final negotiations with a group led by Canadian entrepreneur Michael Kimel to sell a Toronto slot in the Overwatch League, league sources told ESPN on Monday.
The team will be operated by multigame esports organization Splyce, sources said. The slot is expected to sell for $35 million, according to a report from the SportsBusiness Daily. In Season 1, the league sold its 12 franchises for $20 million each.
The group will consist of funding from Kimel, his family -- including Westdale Properties, which is owned by Kimel's uncle Ron Kimel -- and Splyce investor OverActive Media. Splyce will own 10 percent of the team in addition to operating the group.
In April, OverActive Media led a $2.6 million investment round for Splyce. Since that investment, Splyce has explored the possibility of working to become involved in the Overwatch League in Toronto, sources said. Splyce previously had interest in the Overwatch League last year in Boston -- where one of its main investors, Boston Bruins and TD Garden parent company Delaware North, is located -- but that slot was sold to The Kraft Group in March 2017, months before the Overwatch League signed several of its other 12 initial ownership groups.
Current franchise owners include New England Patriots ownership The Kraft Group, New York Mets sister company Sterling.VC, Los Angeles Rams and Denver Nuggets owners the Kroenke family, Philadelphia Flyers parent company Comcast Spectacor and others.
Toronto is the fourth slot that the Overwatch League will sell during its franchise-expansion sales period. On Aug. 3, the league confirmed reports that it had sold Atlanta -- to Atlanta Esports Ventures, a group co-funded by Georgia-based conglomerate Cox Enterprises -- and Guangzhou, China, to Guangzhou Long-Lions parent company Nenking Group.
The league is also finalizing negotiations with McCourt Global -- the Los Angeles-based parent company of Olympique de Marseille, owned by former Los Angeles Dodgers owner Frank McCourt -- for Paris, as reported by ESPN on July 26. Like Atlanta Esports Ventures and McCourt Global, Michael Kimel attended the Overwatch League finals in New York on July 27-28.
Free agency for expansion teams in the second season of the Overwatch League begins Sept. 9.
Activision Blizzard Esports Leagues CEO Pete Vlastelica told German newspaper Handelsblatt in May that the league anticipates to sell six slots across North America, Europe and Asia-Oceania. The league has now agreed to sell four of those six -- Atlanta, Guangzhou, Paris and Toronto -- and is now looking to close deals for two more before September.
Michael Kimel is a minority owner of the Pittsburgh Penguins as well as a co-owner of Toronto-based hospitality group Chase Hospitality Group and is a high-risk venture capitalist. His family, the Kimel family, is a multimillion dollar Canadian family with investment history in real estate and other ventures.