The New York Yankees have lined up Ontario Teachers’ Pension Plan, RedBird Capital Partners and Mubadala Investment for the baseball team’s plan to buy back control of its sports TV network, according to people familiar with the matter.
The Yankees are also in talks with potential strategic partners including Amazon.com to provide digital streaming services and participate financially in the deal for the YES Network, said the people, who asked not to be identified because the discussions are private.
The Yankees and their partners are planning to purchase 21st Century Fox’s majority stake in YES, acquired four years ago.
The team and Fox are in discussions about the fair-market value of the YES Network. It was reported in June that the Yankees had the right to buy back YES in the event Fox put it up for sale, setting the stage for the current talks.
Fox is seeking to sell its 22 regional sports networks, including YES, as a condition of completing the $71 billion sale of its entertainment assets to Walt Disney Co. CNBC reported Tuesday that Amazon is seeking to buy all 22 networks, bidding against Apollo Global Management, KKR & Co., Blackstone Group, Sinclair Broadcast Group and Tegna Guggenheim has valued the bundle at about $22 billion.
Still, since the Yankees have the right to acquire Fox’s stake in YES, the network is likely to be sold separately from the rest of the channels. YES is by far the most valuable of Fox’s regional sports networks, or RSNs, and others are watching to see how the Yankees proceed, the people said. Allen & Co. and JPMorgan Chase & Co. are managing the auction.
The Yankees, which retained 20 percent of YES after Fox deal in 2014, declined to comment. Fox also declined to comment, as did Ontario Teachers’, RedBird, Mubadala and Amazon.
The Yankees are required to get 60 days’ notice of any proposed sale of YES. Once informed, they have 60 days to officially inform the seller that they’re exercising their buyback intention, one of the people said.
The fate of Fox’s regional sports networks, including YES, is the biggest unresolved piece of its pending megadeal. Disney agreed to offload the channels to get regulatory clearance for the merger, which unites two of the biggest media and entertainment companies. Disney already owns ESPN, which reaches roughly 90 million cable customers.
The networks for sale carry the games of more than 40 teams across three major leagues: MLB, the National Basketball Association and National Hockey League. YES, for instance, airs Brooklyn Nets games -- in addition to its Yankees coverage.
RSNs are lucrative because the audience is made up of die-hard fans consuming a live event. That makes it easier to target viewers with advertising. But the RSN sale doesn’t include digital rights to baseball.
Seattle-based Amazon is increasingly interested in adding live sports to its Prime Video streaming service. It had a rocky start with its U.K. coverage of the U.S. Open tennis tournament this summer and is gearing up to show live English Premier League soccer in late 2019. In the U.S., Amazon has had deals since 2017 to show National Football League games online on Thursday nights.
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