MSG Networks — the television home for the New York Knicks, New York Rangers, New York Islanders, New Jersey Devils, and Buffalo Sabres — is reportedly nearing a deal with JPMorgan that will allow the regional sports network to avoid bankruptcy, potentially clearing a path for a merger with YES Network, per the New York Post.
According to the report, MSG Networks would refinance its debt with JPMorgan, lightening its debt load from $800 million to $600 million. As a result of the deal, it would agree to reduce the rights fees it pays to carry Knicks and Rangers games, thereby allowing the network to make its interest payments.
James Dolan, the owner of the Knicks and Rangers and whose Sphere Entertainment owns MSG Networks, is likely to try and offload the regional sports channels through a sale. Investors in Sphere Entertainment, which owns the Las Vegas concert venue by the same name, have long favored moving the networks outside the company as the asset has become a drag on its stock price.
The obvious landing spot for MSG would be YES Network, another New York-based regional sports channel that serves as the television home of the New York Yankees and Brooklyn Nets. Together, MSG and YES launched the Gotham Sports App last year, a direct-to-consumer streaming service that allows fans to purchase access to both networks for one price.
A purchase by YES would be far from certain, but MSG Networks’ debt refinancing and lower media rights fees should make it more attractive to potential buyers.