# Sinclair Broadcasting gains control of U.S. regional sports networks



## phrelin (Jan 18, 2007)

Diamond Sports Group, a wholly-owned subsidiary of the nation's largest owner of local TV stations Sinclair Broadcasting Group, has acquired 21 regional sports networks in a deal with Disney that encompasses local rights to 42 pro teams and saw revenue of $3.8 billion in 2018 from 74 million subscribers. Sinclair was already was part of a group that last month acquired the YES Network, described as the crown jewel of the regional nets, owns the Tennis Channel and the Stadium digital network and recently announced a partnership with the Chicago Cubs on a new RSN launching in 2020.

Disney made the deal as part of a settlement with the government regulators ahead of its $71.3 billion acquisition of most of Fox. Included are Fox Sports Arizona, Fox Sports Detroit, Fox Sports Florida, Fox Sports Sun, Fox Sports North, Fox Sports Wisconsin, Fox Sports Ohio, SportsTime Ohio, Fox Sports South, Fox Sports Carolina, Fox Sports Tennessee, Fox Sports Southeast, Fox Sports Southwest, Fox Sports Oklahoma, Fox Sports New Orleans, Fox Sports Midwest, Fox Sports Kansas City, Fox Sports Indiana, Fox Sports San Diego, Fox Sports West and Prime Ticket. Fox College Sports is also included.

I can find no speculation that this will save sports fans any money.


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## James Long (Apr 17, 2003)

Sinclair Broadcast Group To Acquire 21 Regional Sports Networks From Disney At A Valuation Of $10.6 Billion

BALTIMORE and BURBANK, Cailf., May 3, 2019 /PRNewswire/ -- Sinclair Broadcast Group, Inc. (Nasdaq: SBGI) ("Sinclair" or the "Company") and The Walt Disney Company (NYSE: DIS) ("Disney") today announced that they have entered into a definitive agreement under which Sinclair will acquire the equity interests in 21 Regional Sports Networks (the "RSNs") and Fox College Sports, which were acquired by Disney in its acquisition of Twenty-First Century Fox, Inc. ("21st Century Fox"). The transaction ascribes a total enterprise value to the RSNs equal to $10.6 billion, reflecting a purchase price of $9.6 billion, after adjusting for minority equity interests. Completion of the transaction is subject to customary closing conditions, including the approval of the U.S. Department of Justice.

The RSN portfolio, which excludes the YES Network, is the largest collection of RSNs in the marketplace today, with an extensive footprint that includes exclusive local rights to 42 professional teams consisting of 14 Major League Baseball (MLB) teams, 16 National Basketball Association (NBA) teams, and 12 National Hockey League (NHL) teams. In calendar year 2018, the RSN portfolio delivered a combined $3.8 billion in revenue across 74 million subscribers.

The RSNs will be acquired via a newly formed indirect wholly-owned subsidiary of Sinclair, Diamond Sports Group LLC ("Diamond"). Byron Allen has agreed to become an equity and content partner in a newly formed indirect wholly-owned subsidiary of Sinclair and an indirect parent of Diamond ("RSN Holding Company"). Mr. Allen, who bought The Weather Channel in 2018, is the Founder, Chairman, and Chief Executive Officer of Entertainment Studios, a global media, content and technology company.

Sinclair's existing sports business consists of Marquee Sports Network (a recently announced joint venture with the iconic Chicago Cubs), Tennis Channel and Tennis Media Company (dedicated to live tennis events and tennis lifestyle), Stadium (a joint venture focused on college sports and professional highlights), Ring of Honor Wrestling (professional wrestling), and robust high school sports programming (with Friday Night Rivals and Thursday Night Lights).

"This is a very exciting transaction for Sinclair to be able to acquire highly complementary assets," commented Chris Ripley, President and CEO of Sinclair. "While consumer viewing habits have shifted, the tradition of watching live sports and news remains ingrained in our culture. As one of the largest local news producers in the country and an experienced producer of sports content, we are ideally positioned to transfer our skills to deliver and expand our focus on greater premium sports programming."

Mr. Ripley continued, "The transaction is expected to be highly accretive to free cash flow and brings consolidated net leverage to 4.7x and 5.1x through the preferred financing. This acquisition is an extraordinary opportunity to diversify Sinclair's content sources and revenue streams with high-quality assets that are driving live viewing. We also see this as an opportunity to realize cross-promotional collaboration, and synergistic benefits related to programming and production."

"We are pleased to have reached this agreement with Sinclair for the sale of these 21 RSNs, subject to the conditions of the consent decree with the U.S. Department of Justice," said Christine McCarthy, Senior Executive Vice President and Chief Financial Officer, The Walt Disney Company.

Last year, Disney and 21st Century Fox entered into a consent decree with the U.S. Department of Justice that allowed Disney's acquisition of 21st Century Fox to proceed while requiring the subsequent sale of the RSNs. Sinclair's purchase does not include 21st Century Fox's equity interest in the YES Network, the disposition of which is also required as part of the consent decree. Disney completed its $71 billion acquisition of 21st Century Fox in March.

The RSNs to be acquired by Sinclair are: Fox Sports Arizona, Fox Sports Detroit, Fox Sports Florida, Fox Sports Sun, Fox Sports North, Fox Sports Wisconsin, Fox Sports Ohio, SportsTime Ohio, Fox Sports South, Fox Sports Carolina, Fox Sports Tennessee, Fox Sports Southeast, Fox Sports Southwest, Fox Sports Oklahoma, Fox Sports New Orleans, Fox Sports Midwest, Fox Sports Kansas City, Fox Sports Indiana, Fox Sports San Diego, Fox Sports West, and Prime Ticket. Also included in the acquisition is Fox College Sports.

Sinclair expects to capitalize Diamond with $1.4 billion in cash equity, comprised of a combination of approximately $0.7 billion of cash on hand and a contribution of $0.7 billion in the form of new fully committed debt at Sinclair Television Group, Inc. In addition, the purchase price will be funded with $1.0 billion of fully committed privately-placed preferred equity of a newly-formed indirect wholly-owned subsidiary of Sinclair and direct parent of RSN Holding Company. The remainder of the purchase price is being funded by $8.2 billion of fully committed secured and unsecured debt incurred by Diamond. The transaction will be treated as an asset sale for tax purposes, with Sinclair receiving a full step-up in basis.

The transaction has been unanimously approved by the Board of Directors of both Sinclair and Disney.

SOURCE Sinclair Broadcast Group, Inc.


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## dtv757 (Jun 4, 2006)

Wow , I thought the Braves, liberty, were going to gonna buy FS south 

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## TheRatPatrol (Oct 1, 2003)

Oh boy, here we go, this should get interesting.

_You're watching SSN, the Sinclair Sport Network!_


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## James Long (Apr 17, 2003)

I assume there will be a name change. The ownership structure in the press release with two "indirect wholly-owned subsidiary of Sinclair" companies ("Diamond Sports Group LLC" and "RSN Holding Company") is separate from Stadium Sports and the future Marquee Sports. It appears that YES will be rolled in to the RSN portfolio - although that name will not change.

Like the broadcast side of the business, Sinclair is not hiding the underlying ownership but the branding is yet to be announced. Fox College Sports gives Sinclair a channel to complement their streamed Stadium Sports service. The RSNs could use the Stadium name, "Diamond" or something completely different. And it is all pending regulatory approval.


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## techguy88 (Mar 19, 2015)

I hate Sinclair I can see them trying to bundle the RSNs with their carriage of local channels now.


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## espaeth (Oct 14, 2003)

I wonder how much of a disaster this is going to be when they have to transition off the FOX Sports Go platform for streaming.


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## TheRatPatrol (Oct 1, 2003)

*AT&T Considers Selling Regional Sports Networks to Slash Debt*


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## dtv757 (Jun 4, 2006)

espaeth said:


> I wonder how much of a disaster this is going to be when they have to transition off the FOX Sports Go platform for streaming.


I was thinking similar and what's gonna happen to the nba FSN 4k games ?

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## inkahauts (Nov 13, 2006)

espaeth said:


> I wonder how much of a disaster this is going to be when they have to transition off the FOX Sports Go platform for streaming.


I doubt it'll be an issue. It's already separated from FOX sports app.


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## LMckin (Jan 5, 2006)

they could add the RSN to their stirr app stirr.com also


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## TheRatPatrol (Oct 1, 2003)

*AT&T's auction to sell four regional sports channels falls short
*
Sounds like Sinclair might not be getting these, unless AT&T gets desperate for money.


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## 1948GG (Aug 4, 2007)

This possible sale of the at&t sports channels to Sinclair or whoever is getting bizarre. News reports are saying that the recent Sinclair purchase of the rsn's from Disney/Fox has not resulted in the revenue expected from the carriers as the inflated cost has led to some (Dish an others?) Dropping carridge. So all of a sudden the idea that these rsn's were a cash cow for everyone involved has gotten to be a sinkhole.

These at&t rsn's (originally DirecTV o&o) have some bizarre histories, in particular Root Sports Nothwest. Carridge wars between DirecTV and comcast have gone on for years, with comcast winning out in federal court allowing them to carry the rsn (the home of the Mariners mlb team) but blocking DirecTV from carrying comcasts now rebranded nbcsports northwest, home of the portland trailblazers. Reading the court decision on that one is a trip down convoluted reasoning from the middle ages.

But the result for now seems to be that these sports channels are getting a bit of comeuppance as to their price hiking agenda. And just maybe that will put some additional pressure to stream in-market games to local fans via OTT. One can hope.


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## TheRatPatrol (Oct 1, 2003)

1948GG said:


> Root Sports Northwest. nbcsports northwest,


Its going to be interesting to see who gets the TV contract for the new Seattle NHL team.


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## 1948GG (Aug 4, 2007)

TheRatPatrol said:


> Its going to be interesting to see who gets the TV contract for the new Seattle NHL team.


There is so much bad blood, fermented over several years, between those two rsn's that carridge rights may devolve into a blood match. If seattle would manage to regain a NBA franchise in the next couple of years it could well go nuclear.


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## TheRatPatrol (Oct 1, 2003)

*James Dolan looking into buying SNY as Mets sale rumors swirl*


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## dtv757 (Jun 4, 2006)

TheRatPatrol said:


> *James Dolan looking into buying SNY as Mets sale rumors swirl*


Dolan... insist that the same family that owned Cablevision. And prevented other tv providers like vz from having NY RSNs??

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## James Long (Apr 17, 2003)

Yep. James Dolan of Cablevision (and Voom) fame.


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