It was a much-discussed topic on Tuesday, and on Wednesday the action was confirmed: Diamond Sports Group, the subsidiary of Sinclair Broadcast Group that is the parent of the Bally Sports regional sports networks, has decided not to pay roughly $140 million in interest payments that were due on February 15.
The action puts more pressure on DSG and on Major League Baseball just 10 days before the start of Spring Training.
By missing the interest payments, a 30-day timer has started that serves as a grace period. But, much of the conversation surrounding the inability to pay the interest in a timely manner points to a Chapter 11 restructuring plan. This has put 14 MLB teams with rights agreements with Bally Sports on alert. According to the Associated Press, Diamond has nearly $1 billion in rights payments, mostly to baseball teams, due in the first quarter this year.
In a statement, DSG said it intends to use the 30-day grace period “to continue progressing its ongoing discussions with creditors and other key stakeholders regarding potential strategic alternatives and deleveraging transactions to best position Diamond Sports Group for the future.”
In addition to the 14 MLB teams, the 19 Bally Sports regional networks DSG acquired from FOX Sports has the rights for play-by-play for 16 National Basketball Association clubs and 12 National Hockey League teams.
At the end of the third quarter of 2022, DSG reported debt of $8.674 billion.
