It seems the reports were correct — today it was announced that the Sinclair Broadcast Group would be acquiring 21 regional sports networks from The Walt Disney Company.

  • When the U.S. Justice Department approved Disney’s acquisition of 21st Century Fox assets, it stipulated that the company must sell the 22 regional sports networks it gained from Fox within 90 days of the deal’s closure.
  • Now we know who will own the vast majority of those channels: Sinclair Broadcast Group.
  • Sinclair purchase of the networks for $9.6 billion values the portfolio at $10.6 billion after adjusting for minority equity interests.
  • Like most media transactions, the Justice Department will need to okay this purchase before the deal can close.
  • Notably, this package does not include the YES Network, which is reportedly being snapped up by the New York Yankees among others.
  • Instead, the networks headed for Sinclair include:
    • 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
    • Prime Ticket
  • The RSNs will be acquired via a newly formed indirect wholly-owned subsidiary of Sinclair, Diamond Sports Group LLC.  
  • Additionally, Byron Allen has agreed to become an equity and content partner for Diamond.
  • The transaction has been unanimously approved by the Board of Directors of both Sinclair and Disney.  

What they’re saying:

  • Chris Ripley, President and CEO of Sinclair: "This is a very exciting transaction for Sinclair to be able to acquire highly complementary assets. 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. 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."
  • Christine McCarthy, Senior Executive Vice President and Chief Financial Officer, The Walt Disney Company: "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.”

 
 

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