MSG Networks, the embedded cable television station that broadcasts New York Knicks and Rangers games, is in talks to reach a deal to avoid bankruptcy as soon as Friday-and interior speculate that aid could come from a media player with Deep pocket like Amazon, the post has learned.
Sports channel controlled by billionaire Knicks James Dollan-actually blackened for about 1 million subscribers of the New York area due to a contract dispute with the optimal cable network-but is trying to restructure its debt with a group of lenders led From JPMORGAN who owed $ 829 million.
MSG networks in October predetermined in his loans, but lenders have extended the payment deadline several times, recently from January 10 to Friday at midnight. This time, the goal is to reach an agreement rather than just extend the deadline, according to sources informed about the discussions.
“The talks are continuing,” sources near the situation on Friday afternoon said.
MSG networks did not return the calls and JPMORGAN refused to comment.
To make an agreement happen, sources speculate that MSG will receive money from a new, external investor to refinance the crippled debt load – and submit an action to the cable business in return. No agreement would affect Dollan’s ownership of Knicks and Rangers, the sources added.
Chatter is now circulating that a possible solution would be partner with Amazon, whose service the video video already has a deal with Diamond Sports, the largest operator instead of so -called RSN, or regional sports networks, to broadcast games for pro -sports teams nationwide across the country.
Amazon is also an investor in the network is broadcasting Yankees and Nets Games, with the Prime Minister now broadcasting Yankees weekly games in the New York City area.
Amazon refused to comment.
Sources said a main benefit in an agreement with Amazon would be to give MSG networks an alternative to optimal. The carriage dispute with the Altice USA cable provider costs MSG networks about $ 127 million lost in January, according to analysts.
Comcast also launched MSG networks in 2021. Meanwhile, the MSG network transmission service itself, Gotham Sports App, tariff $ 29.99 a month and has not attracted a large basis of subscribers, sources said
As the MSG networks blaze, Dollan himself has not signaled any possible action to refinance the debt itself. Indeed, the shares of the MSG Networks parent company, the publicly traded sphere entertainment, have increased 7.5% over the past five days, with investors betting that a bankruptcy of MSGN will emanate losses and improve its balance, according to analysts.
The sphere shares decreased 3% in the trading after Friday in the possibility that bankruptcy could be avoided.
If the latest talks fail and MSG networks slide into bankruptcy, lenders are likely to undertake operations and continue broadcasting games, sources said.
A bankruptcy can also raise the chances of an optimal deal, as a lighter debt load would enable MSG networks to upload lower optimal fees to perform its games, sources said.
According to the agreement that expired on December 31, the optimum was paying MSG networks about $ 10 for subscriber, making it one of the more expensive cable channels, according to reports.
Optimum, which has about a third of about 3 million subscribers in the New York City area, is seeking to put MSGN on a premium scale, so there will be far less MSGN Subscribers and can reduce costs.
Its parent company Altice is also deeply in debt.
Without the optimum clients, MSG Networks is losing money even before factoring in his interest payments, analysts said.
“A complete decline would eventually go bankrupt MSG networks,” wrote media analyst Brandon Ross of Lightshed Partners earlier this month in a report.
The income from cable providers is falling in part from cutting the cord as there are far fewer subscribers.
The MSG network contract with FiOS Verizon expires in September, leading to another potentially difficult negotiation, a post lender told.
The cable network is losing money because it is paying $ 187 million in 2025 to broadcast the games of Knicks and Rangers as part of a 20-year deal ending in 2035, according to public records.
“The model is overturned,” said a source in the RSN industry, and the prices paid for media rights a decade ago now make little sense.
The new MSGN owners in a possible bankruptcy can cancel the Knicks and Rangers media rights agreement and negotiate a much lower contract, the RSN source said.
Dollan, who controls the knicks and rangers, can lower the rights fees as part of a general package that keeps MSG networks out of bankruptcy and puts it on stronger financial ground.
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