Diamond Sports activities Group, the biggest proprietor of regional sports activities networks, filed for Chapter 11 chapter safety on Tuesday. The transfer got here after it missed a $140 million curiosity cost final month.
Diamond owns 19 networks underneath the Bally Sports activities banner. These networks have the rights to 42 skilled groups — 14 baseball, 16 NBA and 12 NHL.
The corporate mentioned in a launch Tuesday night time that it expects to proceed to function through the chapter course of and that protection of video games shouldn’t be affected.
Diamond Sports activities additionally mentioned it was negotiating a restructuring settlement with debt holders that might eradicate most of its debt. Beneath an settlement with collectors, it could change into a separate firm from Sinclair Broadcast Group.
“DSG will proceed broadcasting video games and connecting followers throughout the nation with the sports activities and groups they love,” Diamond Sports activities CEO David Preschlack mentioned in a press release. “We stay up for working constructively with our group and league companions and all DSG stakeholders all through this course of and past.”
Diamond mentioned in a monetary submitting final fall it had a debt of $8.67 billion. The chapter submitting was made within the Southern District of Texas.
Sinclair Broadcast Group purchased the regional sports activities networks from The Walt Disney Co. for practically $10 billion in 2019. Disney was required by the Division of Justice to promote the networks for its acquisition of twenty first Century Fox’s movie and tv property to be authorised.
Diamond has practically $1 billion in rights funds, principally to baseball groups, due within the first quarter this yr. The corporate is present on funds to hockey and basketball groups, but it surely would possibly withhold funds from some baseball groups the place it’s making an attempt to renegotiate a greater deal.
Main League Baseball has arrange an area media division in case it has to take over broadcasts for groups. Video games would air regionally by way of MLB Community or streamed on MLB.TV in case that occurred.
Diamond’s chapter is not going to have an effect on Cubs or White Sox video games broadcast on Marquee Sports activities Community and NBC Sports activities Chicago.
“Diamond Sports activities Group’s chapter declaration at present is an unlucky growth that we’ve got been anticipating. Regardless of Diamond’s financial scenario, there’s each expectation that they may proceed tv all video games they’re dedicated to through the chapter course of,” MLB mentioned in a press release late Tuesday night time. “Over the long run, we are going to reimagine our distribution mannequin to deal with the altering media local weather and finally attain an excellent bigger variety of followers.”
Diamond Sports activities is not the one firm experiencing monetary woes with its regional sports activities networks. Warner Bros. Discovery, which has an possession stake in three of the AT&T SportsNet networks, has given the Colorado Rockies, Houston Astros and Pittsburgh Pirates till March 31 to reclaim their broadcast rights. WBD Sports activities is ending its funding within the networks.
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