When the original Disney/Fox deal was announced, the inclusion of Fox’s regional sports network group was seen as one of the more valuable assets involved. However, anti-trust concerns forced Disney to put the RSNs up for sale as a condition of the final purchase, and now that sale process is moving to its next step, with bids due last week.
Normally that clears up the picture, as potential buyers are identified and/or eliminated. In this case, though, two of the companies most often linked to a sale have so far sat the process out. That’s according to this report from Sports Business Journal, which notes that Comcast and Fox have yet to show interest.
Via SBJ:
Speculation over the past several months was that NBC Sports would pick off the RSNs in markets where it is the dominant cable operator — places like Atlanta, Detroit and Miami — and Fox Sports would look to buy back the RSNs at a discount. But the lack of bids to Allen & Co., who is handling the sale along with JPMorgan Chase & Co., threw cold water on both of those scenarios.
Mark Lazarus, NBC Broadcasting and Sports chairman, went so far as to say that Comcast is not in line to buy any of the Fox RSNs. It was notable that Comcast did not even sign a non-disclosure agreement last month that would have given it access to the bid book for the RSNs.
Lazarus offered a pretty simple and very believable reason for Comcast sitting it out:
“The government’s not going to let us buy any more where we are heavy in cable — we’ve already been informed of that,” Lazarus said during a recent Fairfield County Sports Commission event in Stamford, Conn. “We can’t buy any of those assets that Disney is going to try to dispose of.”
Those antitrust concerns were what prevented Comcast from realistically competing with Disney in the original deal, although they certainly made an effort.
As for Fox, considering how profitable the RSNs had been and that they’ve continued to manage them throughout the sales process, it would make some sense on the surface to consider buying them back. But that would also presumably involve sending Disney a decent chunk of the sales price they just received. Obviously Disney didn’t know they’d have to sell the RSNs when they initially bid, but even so, if Fox preferred owning and operating the RSNs over cash, they probably wouldn’t have sold them in the first place.
As to who is actually bidding, that remains unclear. Sinclair has had reported interest, and there have been a few other interested parties as well, all the way down to LL Cool J and Ice Cube. But those bids might not include one of the most valuable networks in the portfolio: according to the SBJ report, the Yankees deal with YES Network included an option to take over the network if it was sold to Disney, Comcast, or James Dolan.
Sources said the team already has been in contact with companies interested in investing in the RSN. Sources with knowledge of those talks said all signs point to the Yankees actually taking back ownership of the RSN, which means that the country’s biggest RSN likely will not be part of the final Fox package being sold.
It’s comforting that no matter what happens elsewhere, the Yankees are still going to be okay. The nation can breathe again.
[SBJ]
