Just made official by YES Network and News Corp., the owner of Fox Sports Media Group, YES is selling a 49% stake in its network to News Corp. In addition, YES will retain the media rights to the New York Yankees through 2042.
The stories that have surfaced about this purchase have stated that News Corp. could increase its stake in YES to as much as 80% within three years. And that the media rights for the Yankees would be worth $350 million annually by the end of the deal.
News Corp. owns 19 regional sports networks across the country as well as a stake in the Big Ten Network. YES is a big feather in its cap.
Here’s the announcement.
NEWS CORPORATION AND YANKEE GLOBAL ENTERPRISES ANNOUNCE NEWS CORPORATION’S ACQUISITION OF AN EQUITY STAKE IN THE YES NETWORK
NEW YORK – November 19, 2012 – News Corporation (NASDAQ: NWS, NWSA; ASX: NWS, NWSLV) and Yankee Global Enterprises today announced an agreement that calls for News Corporation to acquire a 49 percent equity stake in the Yankees Entertainment and Sports Network (YES). The YES Network delivers exclusive live local television coverage of New York Yankees baseball and Brooklyn Nets basketball, as well as other leading local and national sports-related programming. The YES Network also announced a media rights agreement that will keep Yankees baseball on the YES Network through 2042.
The media rights agreement is subject to Major League Baseball approval. The investment is expected to close by the end of the calendar year.
The current owners: Yankee Global Enterprises, Goldman Sachs and other investors will reduce their ownership in connection with this transaction. After three years, News Corporation may acquire an additional stake in the YES Network that could bring its ownership to 80 percent, at which time Yankee Global Enterprises would retain a significant minority stake in the network.
Since its inception in 2002, YES has grown its footprint to include local availability in New York, Connecticut, New Jersey, and parts of Pennsylvania, as well as national availability on several cable and satellite television distributors. The network currently showcases live Yankees and Nets games to approximately 9 million households in the teams’ television territory in the New York area. Outside of the New York area, the YES Network also distributes a variety of national programming to millions of homes across the country.
“We’ve long been a believer in the unique appeal of sports entertainment. Partnering upstream with rights holders is even more important today in the dynamic media marketplace in which we compete. This is a tremendous opportunity to enhance News Corporation’s industry-leading portfolio of sports properties, while also strategically re-entering the New York market,” said James Murdoch, Deputy Chief Operating Officer, News Corporation. “The YES Network represents the gold standard for regional sports networks and is a pioneer in sports media. We look forward to working with Yankee Global Enterprises, the network’s management team, and all of our partners to build on a decade of success and take the YES Network to even greater heights.”
Hal Steinbrenner, Chairman of Yankee Global Enterprises, said, “This transaction underscores the great value we and our partners created in establishing the YES Network and sets the network on the path for even greater achievements in the future. We are excited to have News Corporation as a partner. Its stature and acumen in sports broadcasting on a global scale is unmatched. We look forward to the many opportunities for growth and development that this investment by News Corporation will bring to YES. The Steinbrenner family expects to have a continuing, long-term ownership stake in the YES Network and we will continue our yearly commitment of fielding a championship caliber team for decades to come.”
Fox Sports Media Group is the leader in regional sports programming, operating a leading array of 20 owned-and-operated U.S. regional sports networks, which collectively produce over 5,000 live local events each year and serve as the local TV homes to more than half of all MLB, NHL, and NBA teams.
We also have YES’ statement about the News Corp. purchase.
STATEMENT FROM MR. TRACY DOLGIN, PRESIDENT & CEO, YES NETWORK RE: NEWS CORPORATION’S ACQUIRING EQUITY STAKE IN YES
“We at YES, along with the New York Yankees and our financial partners Goldman Sachs, NJ Holdings and Providence Equity, had an incredible opportunity to build a network that quickly became – and remains — the number one regional sports network in the country, based on any metric. We were able to accomplish this because we have the greatest sports brand in the world, the New York Yankees, other important programming such as the rejuvenated Brooklyn Nets, the unwavering support of our board and, last but not least, an incredibly talented and dedicated group of employees.
FOX wrote the book on regional sports networks, and we are excited to partner with FOX and take advantage of this opportunity to build upon our leadership position. In particular, Ray Hopkins (YES Network COO), John Filippelli (YES Network, President of Production and Programming) and I have all previously worked at FOX, and we are eager to renew our working relationships with the company and with many of our friends and former colleagues. At the same time, we are fortunate to continue to benefit from the vision and support of our current ownership. We are particularly thrilled for our valued employees, who will continue with the YES Network and will benefit from the multitude of resources and opportunities that FOX brings to the table. We look forward to having FOX join our winning team.”
About The YES Network
- Launched March 19, 2002
- Exclusive broadcaster of the New York Yankees and Brooklyn Nets
- Most-watched regional sports network in the country the past nine years (Nielsen)
- Distribution within YES’ home-team footprint: approximately 9 million subscribers
- Total national distribution: approximately 15 million subscribers
- Listed among the Top Ten sports business brands in the world by Forbes the past three years
- Since 2003, YES has won 60 New York Emmy Awards and accumulated 266 New York Emmy Award nominations
That will do it.