Bidder for Disney’s Regional Sports Networks Accuses Cable Operator of Undermining Sale Process

A bidder for Disney’s regional sports networks has issued a complaint with federal regulators alleging the cable operator Charter Communications Inc. is “undermining the sale process,” according to the Wall Street Journal.

  • As part of Disney’s Acquisition of the Fox assets, The Walt Disney Company is required to sell off the 22 regional sports networks they got in the deal.
  • Big3 Basketball LLC is among the bidders for the networks and the company has issued the complaint after their talks with Charter regarding the price the cable company would pay to carry the networks should Big3 be the winning bidder broke down.
  • As a result, Big3 fears the networks will lose carriage and could shy away from bidding, altering the overall result of the auction.
  • In letters to the Federal Communications Commission (FCC), Big3 alleged that Charter’s conduct will depress prices in the auction, potentially benefiting Charter’s largest shareholder, Liberty Media Corp., which is also a bidder.
  • Big3 was founded by rapper/actor Ice Cube and Jeff Kwatinetz and operates a 3-on-3 basketball league commissioned by former NBA star Clyde Drexler.

What they’re saying:

  • Big3, in a letter to the FCC: “Charter’s conduct risks effectively excluding Big3 from the bidding process and tainting the auction. It has been suggested to Big3’s ownership that Charter has disseminated its threat to drop the (regional sports networks) to other members of the industry, thereby suppressing auction prices, chilling bidding, and ultimately hurting Disney’s ability to secure the best price for the (channels).”
  • A statement from Charter: “(Charter) welcomes the opportunity to discuss a future carriage agreement for these networks with whomever ultimately owns them including Big3. Regardless of who owns the programming, we approach all negotiations with the same singular objective of reaching carriage agreements that best meet the needs of our customers.”