News Corporation is reportedly set to buy a 49 percent stake in the YES Network and it may be a hedge against losing its local TV contract with the Dodgers.
The YES Network broadcasts Yankee games and a full slate of Yankees-related programming. It is also the broadcast home of the Brooklyn Nets of the NBA. YES is considered the most successful and profitable regional sports network in the country.
Over the weekend, the New York Times reported that News Corp. is close to acquiring a 49 percent share of YES, which has been valued for purposes of the transaction at $3 billion. A 49 percent share, then, will cost News Corp. $1.47 billion. Until now, shares in YES were divided among the Yankees (34 percent), investment banks Goldman Sachs and Provident Equity (40 percent) and a group of former Nets owners (26 percent). The deal includes an option for News Corp. to increase its stake to 80 percent within five years.
Commence with the Evil Empire jokes...