Diamond Sports had what Judge Christopher Lopez called “a really good day” on Monday when $450 million in debtor-in-possession (DIP) financing was approved.
The financing was announced last month and includes $350 million going to Diamond’s first-lien debt holders, per Sportico. Additionally, Sinclair will pay $495 million to Diamond, which will withdraw its $1.5 billion lawsuit against the company.
Per terms of the restructuring agreement, which was filed on Jan. 17, $350 million of the DIP facility will be used to pay Diamond’s first-lien debt holders, with the remainder being transferred to the company’s balance sheet. Under the terms of the separate agreements Diamond has worked out with its NBA, NHL and MLB partners, the RSNs will continue to televise the teams’ games in their respective home markets through the end of the 2023-24 seasons. (In the case of the 11 MLB clubs that remain affiliated with Diamond, the local rights will expire at the end of this coming campaign, which officially kicks off on March 28.)
The judge also said he would approve an amended Management Services Agreement between DSG and Sinclair Television Group that would see Diamond withdraw its $1.5 billion litigation against its parent company in exchange for a cash payment of $495 million. An attorney for Sinclair today told the court that while some final details pertaining to the revamped MSA have yet to be ironed out, the two sides are likely to wrap up that piece of business within the next day or so.
Diamond also received a $100 million investment from Amazon, selling teams’ digital rights to the company.
Diamond also struck deals with the NBA and NHL to air games through the conclusion of their current seasons before ceding broadcast rights back to the teams. However, those deals are no longer valid due to Diamond’s restructuring, meaning those teams’ rights will remain on Diamond after the season.
The situation is a bit more unclear with MLB. Diamond committed to paying nine teams in full for the 2024 season and struck one-year pacts with the Guardians, Rangers, and Twins for the 2024 season.
I’m just happy that we’re finally approaching an end to this nearly year-long saga.
[Sportico]
