KANSAS CITY, Mo. — The Kansas City Royals have prepared for the dissolution of Bally Sports Kansas City if that happens, according to CEO John Sherman.
Sinclair Broadcast Group Inc.’s regional sports business, Diamond Sports Group LLC, entered chapter 11 bankruptcy on March 14, with more than $8 billion in debt, according to the Associated Press.
Sinclair is expected to give up almost all of its equity in the restructured Diamond, which said on March 14 it is finalizing a restructuring agreement with creditors, FOX Business reports.
Diamond Sports Group skipped about $140 million in interest payments due Feb. 15 and has nearly $1 billion in rights payments, mostly to baseball teams, due in the first quarter this year.
That could affect 14 Major League teams — including the Royals — who could cancel contracts with the broadcaster.
MLB announced it was preparing for the takeover of local broadcasts of 17 teams, including the Royals.
Sherman said the franchise is prepared for that.
“I think the commissioner’s (Rob Manfred) been clear: If anything happens with Bally’s, we’re gonna stand up that network, we’re gonna distribute the games via MLB Network and also direct to the consumer via streaming as well,” Sherman said.
“Regardless of whether the management of that is local or central baseball, it’s gonna be very localized from a broadcast crew in how we deliver our game to our fans.”
The Royals announced that 158 of their games will be on Bally Sports Kansas City with the four other games scheduled for Major League Baseball’s national television package. Sherman also expects to be paid by Diamond Sports Group.
“Not all of the RSNs (regional sports networks) were declared bankrupt, and we were one of the ones that were not. We do expect to get paid,” Sherman said.
“We have prepared for this for a long time, and we are prepared financially if we are not to be paid but I expect us to be paid in 2023.”
Sherman would like to see a centralized, global MLB media company take over the games.
“That was a great structure and a great model while it worked,” Sherman said about the regional sports network model.
“We’d like to have the rights back and be in control of distribution of our content long term,” he said. “I think we’re only in about a third of the households in the U.S. today in our current structure.”
Sherman also said the blackouts have to go away.
“These Friday night doubleheaders are in 60 countries,” Sherman said. “You talk about access long term, I think there’s some real upside there.”
Opening Day for the Royals is at 3:10 p.m. Thursday as they host the Minnesota Twins.