'A Major, Game-Changing Development': Sinclair Broadcast (SBGI) in Talks to Raise Over $250 Million For a New Sports Streaming Service: Report

Sinclair Broadcast Group (NASDAQ: SBGI) is reportedly having talks with investors to secure fresh business capital as it works on a new sports streaming service, the New York Post reported Thursday. The company is working to launch the service next year.

Games by the St. Louis Cardinals, the Dallas Mavericks, and scores of other popular sports teams would be available for SBGI customers. Sinclair already owns rights to show some games of Major League Baseball (MLB), National Basketball Association (NBA), and National Hockey League (NHL).

Now the Post reports that the company is talking to investment bank LionTree to raise over $250 million. The plan is to ask customers to pay $23 a month for games in markets where SBGI owns sports broadcasting rights, which is 21 territories.

“This is a major, major development. And if Sinclair is successful it will change the industry more quickly than I imagined,” the Post quoted a director of a non-Sinclair broadcaster.

In 2019, SBGI paid $9.6 billion to acquire 21 regional sports networks owned by Fox to be able to show games of 14 MLB teams, 16 NBA teams, and 12 NHL teams.

“I think there is a better than 50 percent chance this will happen,” another source knowledgeable about the talks commented.

Greg Bouris, the Sports Management Program Director at Adelphi University and former communications director for the MLB Players Association, believes such a scenario would leave teams with less revenue from broadcasters.

On the other side, customers are likely to benefit from such an offering.

“I think the economics will go backwards and this could be very disruptive. If I was a team owner, I’d be a little nervous. If you go a la carte, then less is more. I could see this really benefiting the consumer,” he commented.

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