Regional sports network owner Diamond Sports prepares for possible bankruptcy

Diamond Sports Group, the proprietor of the largest portfolio of determination sports networks, is preparing for a apt bankruptcy filing aft skipping an involvement outgo owed to bondholders Wednesday, according to radical acquainted with the matter.

The company, which is an unconsolidated and independently tally subsidiary of Sinclair Broadcast Group, said Wednesday it decided to miss astir $140 cardinal successful involvement payments owed to its bondholders and would alternatively participate into a 30-day grace period.

Diamond's management, creditors and different stakeholders person been successful discussions successful caller months arsenic it has been looking to restructure its hefty $8 cardinal indebtedness load. The institution said Wednesday it intends to usage the 30-day grace play to proceed those discussions "regarding imaginable strategical alternatives and deleveraging transactions to champion presumption Diamond Sports Group for the future."

The talks person centered connected a alleged prearranged bankruptcy filing, said the people, who asked to stay anonymous owed to the delicate quality of the negotiations. Diamond and the creditors person been discussing a debt-for-equity swap, which would spot the creditors instrumentality immoderate signifier of ownership of the company, the radical said.

This is simply a apt scenario, but the concern remains fluid and could alteration arsenic discussions progress, the radical said.

A Diamond typical didn't remark further connected the matter. A Sinclair spokesperson didn't instantly comment.

Sinclair acquired the portfolio of determination sports networks from Disney successful 2019 for $10.6 billion, including astir $8 cardinal successful debt. The woody came aft Disney acquired the Fox assets successful 2019, and had to divest the sports networks.

Originally the Fox Sports networks, they were aboriginal rebranded arsenic Bally Sports successful a licensing woody with the casino relation Bally's Corp.

Diamond Sports instituted its ain committee for Bally Sports, and in December appointed David Preschlack, a erstwhile NBC Sports executive, arsenic its CEO. Diamond Sports' portfolio includes Bally Sports Detroit, Bally Sports Florida and Bally Sports Southwest. Its networks are location to more than half of MLB, NHL and NBA teams successful the U.S., Diamond says.

As consumers fly accepted pay-TV bundles, cablegram networks, peculiarly the determination sports networks, person felt the brunt of it. While executives person said ratings stay beardown for sports, including these networks, it doesn't marque up for the shrinking lawsuit base. Diamond's Bally Sports launched a direct-to-consumer streaming enactment past year.

An impending bankruptcy filing has been of interest for the leagues with teams connected the determination sports networks – NBA, NHL and MLB – who get paid ample fees for the rights to the games that aren't nationally aired, according to the people.

Concerns that Diamond could forgo paying the rights payments portion nether bankruptcy extortion person been discussed astatine the leagues, the radical said. However, Diamond has focused connected keeping the networks live and running, which would necessitate the rights to NBA, NHL and MLB games, 1 of the radical said.