Sinclair Broadcast Group has reached a deal to buy the 21 Fox regional sports networks (RSNs) from Disney for a total value of $10.6 billion.
As part of the transaction, Sinclair also acquires Fox College Sports and will place all of its RSNs into a new subsidiary called Diamond Sports Group, with Entertainment Studios’ Byron Allen on board as an equity and content partner. Completion of the transaction is subject to customary closing conditions, including the approval of the U.S. Department of Justice.
Disney was required to offload the 22 regional sports networks it gained as part of its acquisition of 21st Century Fox’s film and TV assets to gain clearance from the Department of Justice. Last week, Fox Business Network reported Sinclair and Disney had a “handshake agreement” for the price.
“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.”
In March, Disney sold the New York-based YES Network back to the New York Yankees, with Amazon as a minority partner, for $3.47 billion. Sinclair had separately partnered with Yankee Global Enterprises (the company that owns the Yankees) and Amazon on this deal, which gave Amazon the rights to stream Yankees games within the team’s regional territory that encompasses New York, parts of New Jersey and Connecticut. The NBA’s Brooklyn Nets games are also carried by YES Network.
The remaining 21 regional sports networks collectively hold local TV rights for 42 professional sports teams across the NHL, NBA and Major League Baseball, in markets including Detroit, Southern California, Dallas, Cleveland and Miami. Major League Baseball, TEGNA and a slew of private equity firms were among the other bidders.
The purchase makes Sinclair, already the largest owner of local TV stations (170) in the country, an even bigger player in the local TV game. Sinclair also owns the Tennis Channel and launching a regional sports network with the MLB’s Chicago Cubs.
Sinclair had been set to buy Tribune’s local TV stations but that deal was scuttled last summer.