Sinclair Broadcast Group on Friday announced it struck a deal with Walt Disney to acquire 21 Fox regional sports networks (RSNs) for $9.6 billion.
The RSNs are valued at $10.6 billion, when including minority equity interests.
Disney agreed to divest the networks in order to get the greenlight from regulators for its $71 billion acquisition of Fox’s entertainment assets. That deal closed in March.
Sinclair is acquiring the following RSNs: 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.
Fox College Sports is also included in the acquisition, while the Fox YES Network is excluded. Disney plans to sell YES through a separate transaction.
Sinclair announced Bryon Allen, founder and CEO of Entertainment Studios, will hold a minority equity interest in and be a content partner to Diamond Sports Group, which is the newly formed Sinclair subsidiary housing the RSNs.
The RSNs are valued at $10.6 billion, when including minority equity interests.
The Sinclair deal includes exclusive local rights to 42 professional teams, including 14 MLB teams, 16 NBA teams, and 12 NHL teams. Sinclair said that in 2018 the RSNs, which represents the largest portfolio of RSNs in the marketplace, generated a combined $3.8 billion in revenue across 74 million subscribers.
“This is a very exciting transaction for Sinclair to be able to acquire highly complementary assets,” said Chris Ripley, president and CEO of Sinclair, in a statement. “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.”
The DOJ must still sign off on the deal, which ACA Connects, an industry group representing smaller cable operators, swiftly voiced opposition to.
“ACA Connects opposes Sinclair’s proposed purchase of the Disney-Fox regional sports networks (RSNs) for the same reason it opposed Sinclair’s failed attempt to buy Tribune’s television stations — if approved, the transaction would allow Sinclair to raise prices to millions of consumers, including those served by ACA Connects members,” said ACA Connects president and CEO Matthew Polka in a statement. “Big 4 broadcast network programming and RSN programming are both critical for ACA Connects members. By jointly negotiating these assets when they serve the same market, Sinclair can raise prices to cable operators for both offerings.”