By Dietrich Knauth
NEW YORK (Reuters) – Regional sports broadcaster Diamond Sports Group received court approval on Thursday for a bankruptcy restructuring that will rebrand its TV channels, trim nearly $9 billion in debt, and renegotiate broadcast contracts with six Major League Baseball teams.
U.S. Bankruptcy Judge Chris Lopez approved the restructuring after MLB dropped an objection that had challenged the viability of Diamond’s future business plans.
Diamond will emerge from bankruptcy as “essentially a new business,” more focused on delivering sports games to fans online, the company’s attorney Brian Hermann told Lopez at a court hearing in Houston.
As part of the restructuring, Diamond agreed to rebrand its channels as FanDuel Sports Network, and partnered with Amazon to stream games on Amazon Prime Video. After emerging from bankruptcy, FanDuel channels will broadcast games for 13 NBA teams, 8 NHL teams.
The company recently reached new broadcast and streaming agreements with six baseball teams, allowing fans to watch games online and on cable TV. MLB had persistently opposed Diamond’s efforts to add streaming rights to its deals, and Diamond recently said it was prepared to cut ties with all MLB teams except one if it could not rework its contracts.
Diamond ultimately reached last-minute, multi-year deals with about half of its MLB partners, while cutting ties with others. All of the reworked deals include online streaming rights, but Diamond did not disclose the length or financial terms of the contracts.
Diamond has new multi-year deals to broadcast games for the Atlanta Braves, Miami Marlins, Los Angeles Angels, St. Louis Cardinals, and Detroit Tigers.
Diamond ended its contracts with the Cincinnati Reds, San Diego Padres, Arizona Diamondbacks, Cleveland Guardians and Texas Rangers during its bankruptcy.
Diamond also introduced a new “pay per game” option for fans who want to access National Hockey League and National Basketball Association games without a subscription.
Diamond, which previously relied on three cable TV distributors for more than 80% of its income, filed for bankruptcy in March 2023, caught between its expensive legacy contracts with sports teams and a decline in revenue from cable TV due to sports’ viewers cable-cutting.
Before its bankruptcy filing, Diamond broadcast about 40% of regular-season baseball, hockey and basketball games in the U.S. through its Bally Sports-branded television channels.
The bankruptcy restructuring will wipe out the equity stake of Diamond’s corporate parent, Sinclair Broadcast Group and turn over ownership of the company to a group of its lenders, including PGIM Inc and Hudson Bay Capital Management. The restructuring will cut Diamond’s debt to $200 million from almost $9 billion.
(Reporting by Dietrich Knauth; Editing by Richard Chang)
Comments