Amazon to invest in Diamond Sports as part of bankruptcy

Amazon to invest in Diamond Sports as part of bankruptcy

Amazon will partner with Diamond Sports as part of a restructuring deal as the region’s biggest sports owner looks to emerge from bankruptcy.

Diamond has 18 networks under the Bally Sports banner. The network has rights to 37 professional teams: 11 MLB, 15 NBA and 11 NHL.

Diamond Sports has been on the rise in Chapter 11 in the Southern District of Texas since it filed for bankruptcy protection last March. The company said at the end of 2021 that it had $8.67 billion in debt.

The terms of the partnership were announced by Diamond Sports on Wednesday morning. Amazon had no comment. It remains approved by the bankruptcy court.

The agreement with the biggest creditors of Diamond Sports allows it to get out of bankruptcy, continue to work and prevent the complete collapse of the regional sports system in which the NBA, NHL and MLB must intervene to take over the production and distribution of many of them. groups.

Last season, MLB had to buy and sell the San Diego Padres and Arizona Diamondbacks after the Diamondbacks let the Padres’ free agency expire and were unable to agree to a revised contract with the Diamondbacks.

Under the restructuring agreement, Amazon will make a limited investment in Diamond and enter into a business to provide access to Diamond through Prime Video.

Customers will be able to access their local content on Prime Video channels where Diamond has the rights. Pricing and availability will be announced at a later date. Local sports content can also be found on cable and satellite.

Amazon Prime already carries some New York Yankees and Brooklyn Nets games produced by the YES Network.

Diamond also has an agreement with Sinclair to settle pending litigation between the company and other defendants. The settlement is supported by Diamond’s creditors who are parties to RSA.

Sinclair Broadcast Group bought the regional sports network from The Walt Disney Co. about $ 10 billion in 2019. Disney was required by the Department of Justice to sell the network in order to acquire the film and television of 21st Century Fox for approval.

Even before Sinclair bought the local network, the business fell apart due to cord-cutting and declining advertising revenue after it entered into long-term contracts with other groups.

Under an agreement with creditors last year, Diamond Sports Group became a separate company from Sinclair.

As part of the settlement, Sinclair will pay Diamond $495 million and provide ongoing support to Diamond’s restructuring. Proceeds from the deal will also pay off other creditors.

“We are pleased to have entered into a comprehensive restructuring agreement that provides a strategic plan for restructuring and new funding that will enable Diamond to continue to operate and thrive beyond 2024,” Diamond Sports CEO David Preschlack said in a statement. “We are grateful for the support from Amazon and a group of our major lenders who clearly believe that this business will make a profit. Diamond’s goal is to establish RSA and emerge from bankruptcy as a problem moving forward. The benefit of our investors, employees us, our team, our league partners and distributors, and the millions of fans who continue to enjoy our broadcasts.”

Diamond recently reached an agreement with the NHL and NBA to retain local rights through the end of this season. It remains in talks with MLB about a proposed re-contract for next season, and the next court hearing is expected on Friday.

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