Sinclair Broadcast Group Closes Deal With Disney for 21 Fox RSNs
The deal is valued at $10.6 billion and Jeff Krolik will continue to lead the group of RSNs
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It’s finally official: Sinclair Broadcast Group has closed its deal with The Walt Disney Company to acquire the equity interests in 21 regional sports networks and Fox College Sports, which were acquired by Disney in its deal with 21st Century Fox. The transaction, which closed Friday after getting the green light from the U.S. Department of Justice, ascribed a total enterprise value to the RSNs equal to $10.6 billion (an aggregate purchase price of $9.6 billion after adjusting for minority interests).
The RSN portfolio, which excludes the YES Network (though Sinclair reportedly also has a deal in place for YES Network), is the largest collection of RSNs in the marketplace today with exclusive local rights to 42 professional teams consisting of 14 MLB teams, 16 NBA teams, and 12 NHL teams. Sinclair and the Chicago Cubs will also be launching a new RSN – the Marquee Sports Network – this spring.
“We are very excited about the transformational aspects the RSN acquisition will have on Sinclair and are eager to bring those opportunities to life,” said Chris Ripley, President & CEO of Sinclair. We welcome Jeff Krolik, President of the RSNs, and the rest of the RSN management team and staff to the Sinclair family. We have an exciting future ahead of us.”
The announcement brings to a close a long journey for the Fox Sports RSNs, which were originally put up for auction more than a year ago when Disney and 21st Century Fox entered into a deal with the Department of Justice that allowed Disney’s acquisition of 21st Century Fox to proceed while requiring the subsequent sale of the RSNs.
The RSNs were acquired via a newly formed, indirect subsidiary of Sinclair, Diamond Sports Group. Byron Allen has agreed to become an equity and content partner in a newly formed indirect subsidiary of Sinclair and an indirect parent of Diamond. 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.
The RSN brands 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.
The aggregate purchase price, transaction costs, and an additional cash amount contributed to Diamond was funded through a $1.4 billion cash contribution from Sinclair, $1.0 billion of preferred equity issued by a parent company of Diamond (also an indirect subsidiary of Sinclair), a $3.3 billion secured term B loan facility entered into by Diamond, and $3.1 billion of secured notes and $1.8 billion of senior notes issued by Diamond and Diamond Sports Finance Company.
