News Corp. has acquired nearly half of the YES Network, cable home of the New York Yankees, with an option after three years to boost its position to 80 percent (pending Major League Baseball approval). The 49 percent stake is worth quite a bit: Forbes values the network at some $3.4 billion.
The Yankees, Goldman Sachs and other investors will sell down their stakes to make room for News Corp., which means a serious payday for the Yankees, too, given that the organization owns 34 percent of the network at present. The deal is expected to close by year-end; the Yankees will become $400 million and $500 million richer. Goldman's private equity unit will see its stake reduced from 30 percent to 12 percent.
With the agreement comes another deal: a contract between the Yankees and YES that will keep the team on the regional sports network (one of cable's most reliable recent success stories) until 2042. The 11-year-old YES is in about 9 million households in the New York area; it carries both Yankees baseball games and Brooklyn Nets basketball.
RSNs frequently command much higher subscriber fees than other cable networks—YES commanded some $502.3 million in affiliate fee revenue last year, with $68.7 million in ad revenue on top of that. Its local competitor, Sports New York (SNY), which airs Mets games, pulled in $40.5 million in ad sales revenue and $428.4 million in affiliate fees for the same year.