Diamond Sports OK’d to emerge from bankruptcy

Diamond Sports Group, the largest regional sports network operator in the United States, emerged from bankruptcy Thursday, on the 20-month anniversary of it filing for Chapter 11. Judge Christopher Lopez, presiding in the Southern District of Texas, approved the company’s reorganization plan in court, saying it is “compliant with every provision under the law.”

Diamond will emerge with 27 MLB, NBA and NHL teams under its portfolio, all of which can be watched through linear cable or streamed online.

The company recently agreed to a new naming-rights deal with FanDuel, as well as a commercial agreement with Amazon that will eventually allow subscribers to watch Diamond’s RSNs locally through Prime Video. Those deals — along with agreements with the company’s largest distributors, most notably Comcast — helped get Diamond past the finish line. Until last month, Diamond’s broadcasts operated under the name Bally Sports.

One of the clearest signs that Diamond would emerge arrived Wednesday afternoon, when Major League Baseball and the Atlanta Braves withdrew their objection. MLB has had a testy relationship with Diamond over the past couple of years, annoyed by missed payments and skeptical of the company’s financial sustainability. A tipping point arrived in early October, when Diamond submitted a reorganization plan that called for it to shed every MLB contract except that of the Braves.

But Diamond has since agreed to revised deals with the Los Angeles Angels, Miami Marlins, St. Louis Cardinals, Detroit Tigers and Tampa Bay Rays, all of which include direct-to-consumer streaming rights. A revised deal with the Braves, that also includes streaming rights, followed, prompting MLB and the Braves to withdraw their objection. The company maintains the rights to 13 NBA teams and eight NHL teams through at least the 2024-25 seasons.

The lone objection remaining Thursday revolved around the U.S. Trustee, which oversees bankruptcy cases, questioning legal releases in the reorganization plan. Judge Lopez ultimately ruled that he is OK with the releases, triggering Diamond’s emergence.

Sinclair, which previously installed Diamond Sports Group as a subsidiary, originally purchased 21 regional channels from Fox for $10.6 billion in 2019 but took on $8 billion in debt in order to do so. That debt, coupled by accelerated cord-cutting amid an ever-changing media landscape, prompted Diamond to fall into bankruptcy.