Bally Sports Regional Networks has taken a major step toward exiting its lengthy Chapter 11 bankruptcy proceedings, signing new deals with the NHL and NBA that will broadcast team games through at least the end of the upcoming 2024-25 season. The news was contained in court documents asking the bankruptcy court to approve the deals.
The agreement covers nine NHL teams and 13 NBA clubs. The MLB is not included because the contract for the current season is already underway.
The developments come about a month after Diamond Sports, the parent company of Bally Sports, again postponed a hearing to confirm its exit plan under the U.S. Chapter 11 process. The hearing was scheduled for July 29 and 30. The NBA and NHL had been particularly vocal in insisting that this deadline must be met to provide clarity for future Bally Sports teams. However, Diamond justified the postponement of the hearing by citing progress in discussions with the distributor – an extension with Comcast was due to be announced a few days later – and with the leagues.
“The NBA Term Sheet is an example of the significant progress the Debtors have made through their tireless and sustained efforts to negotiate and develop future relationships with the key commercial parties in these cases, including the professional sports league and the Debtors’ team partners, so that the Debtors can emerge from the Chapter 11 bankruptcy proceedings as a going concern,” Diamond’s NBA filing states. “The Debtors are optimistic that the results of these negotiations will form the basis for a confirmable plan of reorganization to continue as a going concern, and the Debtors believe the NBA Term Sheet represents a significant step toward achieving that goal.”
The agreements, the documents say, change the terms of the contracts with the 22 teams, even though they are already sealed, but are believed to involve a reduction in licensing fees in light of the deteriorating regional sports network market, in exchange for assurances that Bally Sports will televise the games and receive streaming rights.
If Diamond does not have a Chapter 11 exit plan in place by the end of the next NBA and NHL season, the contracts will be terminated. If Bally Sports defaults on its payments by then, the teams will become senior creditors and receive liens on Diamond’s assets. However, if Diamond gets a plan approved, the NBA and NHL agreements will automatically continue after the next season.
Several teams, including those that were dropped from Bally Sports like the Phoenix Suns and Dallas Mavericks, are turning to streaming and local television. This will inevitably lead to higher viewership, but without the fees from Bally Sports, significantly less revenue. That’s one reason why Bally teams are willing to accept a lower fee than what is in their contract.
Meanwhile, the big question surrounding Chapter 11 is the great unknown of what MLB’s next move will be. MLB has opposed Diamond at nearly every step since filing for Chapter 11 in March 2023. Its focus has been on whether extending the cable distributors’ contracts makes economic sense and can support the Chapter 11 exit plan. The league has threatened to oppose the plan if it believes it does not support Bally Sports’ survival.
The nine NHL clubs are the Carolina Hurricanes, Tampa Bay Lightning, Minnesota Wild, Columbus Blue Jackets, Nashville Predators, Anaheim Ducks, Detroit Red Wings, St. Louis Blues and Los Angeles Kings (the Kings and Blues are each part of joint ventures with Diamond).
The 13 NBA teams are the Detroit Pistons, Milwaukee Bucks, Cleveland Cavaliers, Miami Heat, Memphis Grizzlies, Minnesota Timberwolves, Los Angeles Clippers, Atlanta Hawks, Charlotte Hornets, Oklahoma Thunder, San Antonio Spurs, Indiana Pacers and Orlando Magic.
Diamond also filed a motion finish the contracts with the Dallas Mavericks and the New Orleans Pelicans. The Pelicans have already announced that they will broadcast games locally on a Gray Television affiliate starting this season. Mavericks minority owner Mark Cuban has hinted that the Mavs may move away from Bally’s, but an official change in their distribution strategy has yet to be announced.
The NHL said in a statement: “We are pleased with this collaboration, which has enabled the parties to reach an agreement to keep these RSNs operating and bringing games to our fans.”
The NBA said: “We have entered into a new agreement with Diamond Sports Group for the 2024-25 season in which Diamond RSNs will broadcast local games of 13 NBA teams. The Dallas Mavericks and New Orleans Pelicans have declined to continue broadcasting their games on Diamond RSNs and will shortly announce further details on how to watch the upcoming season’s games in their respective markets. This new agreement is subject to bankruptcy court approval.”
