MLB nears deal with embattled Diamond Sports Group for financial relief
Major League Baseball (MLB) is on the verge of finalising an agreement with Diamond Sports Group (DSG), the troubled regional sports network operator, offering immediate financial stability for up to 11 teams.
Front Office Sports has reported that legal representatives for both parties informed a Texas court about the ongoing development of a settlement framework, signalling a potential exit from bankruptcy protection for DSG after an arduous eight-month period.
While the precise details of the deal remain uncertain, MLB’s legal team has emphasised that several conditions must be met before finalising the agreement. Teams whose local broadcast rights are managed by DSG’s Bally Sports Network include Atlanta Braves, Cincinnati Reds, Cleveland Guardians, Detroit Tigers, Kansas City Royals, Los Angeles Angels, Miami Marlins, Milwaukee Brewers, St Louis Cardinals, Tampa Bay Rays and Texas Rangers, stand to benefit from this arrangement.
DSG sought Chapter 11 bankruptcy protection in March, aiming to restructure its substantial debts, reaching as high as US$8 billion, stemming from substantial local rights contracts with MLB, the National Basketball Association (NBA), and the National Hockey League (NHL) teams.
The company contends that these contracts are no longer sustainable in the modern media landscape, given the decline in pay-TV households and the absence of streaming rights for all teams in its portfolio. To successfully emerge from Chapter 11, DSG must present a viable business plan, a task it has yet to accomplish despite multiple deadline extensions.
In a recent development, DSG reached an agreement with the NBA, allowing Bally Sports networks to broadcast local games involving 15 teams until the conclusion of the 2023-24 season, with rights reverting back to the league thereafter. A similar arrangement is reportedly in progress with the NHL. Now, MLB seems poised to reach a settlement, providing its teams with enhanced financial clarity just in time for the upcoming season.
The next court hearing is scheduled for January 10, marking a crucial milestone in the ongoing negotiations between MLB and DSG.
