It was the expected outcome, but it is no less jarring. Diamond Sports Group, which runs Bally Sports, is expected to file for bankruptcy within the next month after missing a $140 million interest payment, per a report from John Ourand of the Sports Business Journal. This will result in a Chapter 11 bankruptcy and restructuring/reorganization effort.
It's official. Diamond Sports has elected to skip its $140 million interest payment and has entered a 30-day grace period that is expected to lead to a bankruptcy filing.— John Ourand (@Ourand_SBJ) February 15, 2023
Also, per Ourand:
“The company intends to use the 30-day grace period to continue progressing its ongoing discussions with creditors and other key stakeholders regarding potential strategic alternatives and deleveraging transactions to best position Diamond Sports Group for the future. Diamond Sports Group expects that its business will continue as usual, and it will keep broadcasting quality live sports productions for fans while it addresses its balance sheet.”
In the short term, this doesn’t change much on the surface for fans. Bally Sports is expected to continue to operate, but teams such as the Atlanta Braves, could see their revenues affected. MLB Commissioner Rob Manfred recently told the AP that the league will take over the distribution of streaming or cable if Diamond Sports is unable to air any games this season. The league also recently hired Billy Chambers, a former Sinclair and Fox Sports executive, and tasked him with finding an effective means to distribute games to local markets.
In short, the league is prepared to step in if Diamond Sports/Bally’s can’t broadcast games and they have hired someone and tasked him with finding a long-term solution to something that has become a mess.
Today’s news wasn’t unexpected. Things have been trending this way for some time now. What happens next will be something to keep an eye on.