Sinclair Broadcast Group will acquire 21 regional sports networks (RSNs) and Fox Collge Sports in $10.6 billion deal from Disney.
Disney acquired these from Twenty-First Century Fox, but because of Disney’s already heavy presence in sports (mostly through ESPN and its various networks), the company was required by regulators to divest those regional sports networks in order to get approval for the deal to go through.
Sinclair owns the largest number of local TV stations in the US, nearly 200. According to the press release issued by Sinclair, the RSNs will be run under a newly-formed subsidiary, Diamond Sports Group, run by Detroit native Byron Allen, the owner of Entertainment Studios who bought The Weather Channel last year.
In order to complete Disney’s $71.3 billion purchase of 21st Century Fox’s entertainment division, the US Department of Justice ruled it had to sell the RSNs.
“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.”
“We are pleased to have reached this agreement with Sinclair for the sale of these 21 RSNs, subject to the conditions of the consent decree with the US Department of Justice,” said Christine McCarthy, Senior EVP and CFO, The Walt Disney Company.
Sinclair’s purchase does not include 21st Century Fox’s equity interest in the Yes Network, the disposition of which is also required as part of the consent decree.
