America’s largest RSN owner, Diamond Sports Group, files for bankruptcy

The Sinclair-affiliated RSN owner disclosed its plans Tuesday evening.

The regional sports networks in America are in financial trouble.

The largest owner of RSNs in the nation and a Sinclair affiliate, Diamond Sports Group, filed for Chapter 11 bankruptcy on Tuesday evening in the U.S. Bankruptcy Court for the Southern District of Texas. Under the Bally Sports brand, Diamond runs 19 RSNs that broadcast games from more than half of the MLB, NBA, and NHL teams.

San Diego Padres Game
San Diego Padres 

The company stated in a statement on Tuesday that it “intends to use the proceedings to restructure and strengthen its balance sheet, while continuing to broadcast high-quality live sports productions to fans across the nation.”

The company says its RSNs will continue to operate during the proceedings and that it has $425 million in cash on hand.
The company is “finalizing a Restructuring Support Agreement (‘RSA’) with holders of a majority of the Company’s debt and Sinclair Broadcast Group, Inc. (‘Sinclair’) to eliminate over $8 billion of the Company’s outstanding debt,” it added.

“The DSG Board of Managers has been evaluating strategic opportunities with the support of its advisors and in coordination with creditors to position the Company for long-term success and has determined that the best path forward for the Company and its stakeholders is to restructure through a Chapter 11 process,” DSG CEO David Preschlack said in a statement. “DSG will continue broadcasting games and connecting fans across the country with the sports and teams they love. With the support of our creditors, we expect to execute a prompt and efficient reorganization and to emerge from the restructuring process as a stronger company.”

After purchasing the former Fox Sports RSNs that were sold as part of Fox’s sale to Disney, Sinclair Broadcast Group established DSG in 2019. However, the cable TV industry has declined much more quickly than expected, forcing the company to create a direct-to-streaming service on a tighter schedule and upsetting its league partners in the process.

After years of serving as the backbone of pay TV, RSNs have lost much of their regional appeal and become prohibitively expensive for many cable providers.

Another RSN owner, Warner Bros. Discovery, informed its leaguer partners last month that it wanted to completely leave the industry and offered its RSNs to the MLB, NBA, and NHL for no charge.