News Corporation’s Bid for a Stake in YES Would Value Channel at $3 Billion

[ieddyi]

Wow- YES valued @ 3 billion, News Corp gets 49% stake w/ chance to get cpntrol

Implications...........

"News Corporation is on the verge of acquiring up to 49 percent of the YES Network from the Yankees and their partners, according to three people familiar with the negotiations. The purchase price for the noncontrolling stake is based on a valuation of the channel at slightly more than $3 billion.

Even a minority stake in YES would be a prize for News Corporation, whose Fox Sports division owns 19 regional sports networks around the country. YES is the most valuable regional sports network, having built its appeal on televising Yankee games, pre- and postgame shows and the “Yankeeography” series to a large, rabid fan base.

YES, which also televises Nets basketball games, has served as a model for other team, league and college-conference-owned channels.

Although News Corporation prefers to have 100 percent ownership of its regional networks, it would be able to share in the profits of YES. And according to the people familiar with the discussions, who spoke late last week, the deal would provide News Corporation a route to eventual control of YES — an option would exist in three to five years for the company to increase its investment to as much as 80 percent. But at that point, the price would be based on a valuation of at least $3.5 billion."

http://mediadecoder.blogs.nytimes.co...-at-3-billion/

PS

That values YES as more valuable than the team itself

[philleotardo]

Selling to Satan

[JOBA RULES]

no excuses to lower payroll now!!!! OH COTDEEZ!

[GordonGecko]

The problem for News Corp is that YES is worth half as much if they're not owned by the Yankees. The reason is that the Yankees grossly underprice the value of their TV contract with YES in order to shelter cash flow from MLB revenue sharing.

If the Steinbrenners sold off YES, they would no longer have any reason to discount the TV rights to YES and they would negotiate a market value contract somewhere in the neighborhood of $5 Billion over 20 years, or 2.5/10. So News Corp needs the Yankees to maintain that equity or else the value of YES goes way down

[useref15]

I'm surprised it is only $3 billion actually. Didn't the Los Angeles Lakers just sign a deal worth $5 billion for their tv contract?

[theDurk]

I'm surprised it is only $3 billion actually. Didn't the Los Angeles Lakers just sign a deal worth $5 billion for their tv contract?

That $5 billion is a COST that is PAID by the TV network (over up to 25 years). You can't compare that number to a valuation OF the network.

[chisox]

http://www.businessweek.com/news/201...s-through-2042

[bl73]

"The increased revenue going to the Yankees gives the Steinbrenner family resources to hold onto the team, said Ganis, who has advised the Yankees previously."

Anyone care to interpret this line of ths story?

[parkerstrong]

This is bad news- Sadly George is gone. If anything, the Yankees should be looking to buy MORE of the YES network instead of selling it. The wording that this is the cash the family needs to keep the team is HOPEFULLY window dressing, otherwise the family is having quite a bit of trouble. They must make so much money each year and if they are out of cash, they are screwing up big time.

[SI Baseballman]

smart move by Fox. I don't think they are thrilled by what the Dolans have done with their regional sports network in NY which was taken over by MSG and only carries Islanders and Devils games when Hockey is around. Their network needs a better flagship piece, and what better piece than the Yankees and an up and coming basketball team in the Nets. I bet YES starts airing more FOX produced college football and college basketball games during the offseason.

[Cool Papa B.]

RT @BloombergNews BREAKING: News Corp. to buy 49% stake in YES Network; terms undisclosed.

https://twitter.com/BloombergNews/st...24597644386304

[RYMASTER or Ryan_Yankees]

[effdamets]

Sorry fellas....
But this is the first step into another "CBS era"...

It's been fun looking forward to October every year.
I have a bad feeling about Octobers to come...

[yankeeprideU2]

http://www.businessweek.com/news/201...s-through-2042

On TV rights alone, the yankees are getting $350 million a year based on this article. Why the heck are they worry about the stupid $189 mio luxury tax threshold in 2014? That's just pure greed. Support the brand at all cost. It's worked so far and will continue to work. George was a genius.

[Jerkface]

On TV rights alone, the yankees are getting $350 million a year based on this article. Why the heck are they worry about the stupid $189 mio luxury tax threshold in 2014? That's just pure greed. Support the brand at all cost. It's worked so far and will continue to work. George was a genius.

They will get 350 million a year by 2042. They currently get around 85 million a year from TV.

[GordonGecko]

They will get 350 million a year by 2042. They currently get around 85 million a year from TV.

The Advertising value of that contract is probably $250M or more currently. Which means the Steinbrenners get $85 Million on the Yankees side and at least $165 Million on the YES side, which they split with their co-owners like Goldman Sachs but that is sheltered from MLB revenue sharing

On TV rights alone, the yankees are getting $350 million a year based on this article. Why the heck are they worry about the stupid $189 mio luxury tax threshold in 2014? That's just pure greed. Support the brand at all cost. It's worked so far and will continue to work. George was a genius.

Like jerkface said, that $350M will be in 2042

As for the Yankees obligations if they are over $189M in 2014, you can learn a little more about the consequences by reading:
http://www.fangraphs.com/blogs/index...sharing-syste/

[nnysiny]

i suddenly feel dirty

[ieddyi]

i suddenly feel dirty

Maybe, but you'd still cash the check, no?

[philleotardo]

Maybe, but you'd still cash the check, no?

I wouldn't even return their phone calls.

[ieddyi]

I wouldn't even return their phone calls.

Sounds like the same logic as used by the Hostess bakers union......

[philleotardo]

Sounds like the same logic as used by the Hostess bakers union......

That they wouldn't take money from a criminal organization?

[ieddyi]

That they wouldn't take money from a criminal organization?

No, my point was tha both decisions showed a curious lack of logic from my perspective

And Murdoch's media empire is criminal how ?

If you're talking about the phone hacking, yes, that was criminal, but the people involved were a very small percentage of the entire organization.

If you're gonna follow through on that type of logic, there's very few large organizations composed entirely of angels. You'd be growing your own food and making your own cars, etc

[philleotardo]

If you're gonna follow through on that type of logic, there's very few large organizations composed entirely of angels. You'd be growing your own food and making your own cars, etc

Corporate America is unethical? No ess.

And I'll cut all the chase out for you and get myself in trouble. I'm not a liberal but I will cheer the day Rupert Murdoch dies, knowing full well it would change nothing about how his operation does business. It is a tragedy that the Yankees will have any affiliation with these scumbags.

[nnysiny]

Maybe, but you'd still cash the check, no?

not everyone is for sale

[hardrain]

I fear this is the beginning of the end.