Bally Sports RSNs have been under fire from DISH and others due to bankruptcy
Sinclair’s sports channels are preparing for bankruptcy, including the fall of Bally Sports RSNs, according to Bloomberg.
The Sinclair Broadcast Group is preparing the Diamond Sports group for bankruptcy. Diamond Sports group operates 21 regional Bally Sports-branded regional sports networks, including Bally Sports Midwest, Arizona, Detroit, West and many more. This would cause danger to payments for the MLB, NHL and NBA; it would also cause more damage to Sinclair and DISH.
If a new agreement between Sinclair broadcasting and DISH isn’t reached by Aug. 16, it would lead to a total shutdown of all channels by Sinclair. The number would be 108, including ABC, Fox and more affiliates.
Bloomberg Breakdown
The following quotes are excerpts from Bloomberg’s report.
“With financial troubles mounting, the Sinclair Broadcast Group Inc.-owned firm will likely skip $140 million in interest payments due mid-February, kick-starting a 30-day grace period, according to people familiar with the matter,” Bloomberg’s report said.
“A stark divide is emerging between would-be winners and losers: its $630 million first-lien loan is trading at 92 cents on the dollar, while nearly $5 billion of lower-ranked bonds change hands for under 10 cents — signaling a near-total wipeout for subordinated creditors.
“If Diamond doesn’t enter bankruptcy soon, it will need to pony up cash to pay teams and leagues for TV rights. The company has about $585 million in cash on hand, as of September 30, but owes about $2 billion in fees to teams this year. Rights payments in the first quarter are usually the highest of the year.
“If Diamond, in which Bally Sports operates under, it could lead to drastic news for the MLB and other professional sports leagues. Leading to broadcasting-rights revenue for the likes of MLB,” via Bloomberg.
What would happen to professional leagues with Sinclair?
With bankruptcy looming, MLB teams and other organizations which wouldn’t be paid by Sinclair are preparing for the worst. It is likely that Diamond would discontinue their rights payments in a bankruptcy settle, which could lead the company and its partners bringing in teams and the three leagues as equity partners in a reconstructed ideal.
Reaching on this idea, the MLB, NHL and NBA have not made any further comments on the situation, per Bloomberg.
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