Diamond Sports Group, the corporation which owns the Bally Sports regional sports networks, officially filed for Chapter 11 bankruptcy in the Southern District of Texas this afternoon. The company announced the news in a press release.
Josh Kosman of the New York Post reported yesterday that Diamond was planning to file for bankruptcy. That was expected to officially occur on Friday, but the process has evidently been accelerated a few days.
“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,” said CEO David Preschlack. “We are utilizing this process to reset our capital structure and strengthen our balance sheet through the elimination of approximately $8 billion of debt.”
The most notable development for fans of teams whose local broadcasting deals are carried through Bally is that the company confirmed the RSN “will continue to operate in the ordinary course during the Chapter 11 process.” The corporation added it has approximately $425MM in cash to fund the business during its restructure.
Diamond is responsible for local broadcasts for 14 major league teams*. Kosman reported yesterday that Diamond would try to restructure its deals with some of the clubs but was planning to entirely reject its contracts with the Diamondbacks, Padres, Guardians and Reds. (Diamond didn’t provide any specifics on its planned course of action in today’s release.)
According to the Post, MLB is planning to step up for teams whose contracts are abandoned and stream them in-market for free while the league searches for alternatives. There’ll surely be more developments over the coming weeks and months, but the long-anticipated bankruptcy for the fledgling RSN corporation has officially been set in motion.
* The Angels, Braves, Brewers, Cardinals, Diamondbacks, Guardians, Marlins, Padres, Rangers, Rays, Reds, Royals, Tigers, and Twins are all broadcast by Bally.