AT&T is reportedly considering selling off its regional sports networks to help pay down the massive debt load it incurred through its DirecTV and Time Warner acquisitions.
Bloomberg, citing people familiar with the matter, said AT&T could land as much as $1 billion for the four networks: AT&T SportsNet Pittsburgh; AT&T SportsNet Rocky Mountain, serving Utah, Nevada and Colorado; AT&T SportsNet Southwest, serving parts of Texas and Louisiana; and Root Sports Northwest, serving Alaska, Washington and Oregon. The channels have rights to air games from teams including the Houston Rockets and the Seattle Mariners.
According to the report, Sinclair has emerged as a potential buyer for the networks. Earlier this year, Sinclair submitted a winning $9.6 billion bid for Fox’s 21 regional sports networks, which Disney had to sell off as a condition of its $71.6 billion deal for Fox. Sinclair this year also teamed up with the Chicago Cubs to launch a new RSN, Marquee Sports Network.
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The report was careful to point out that AT&T hasn’t yet begun the official process of selling the networks and may not arrive at a deal. The company would only make a small dent in its more than $180 billion in debt, but it could also reduce costs by getting out of paying the rising costs of sports rights.
In April, AT&T CEO Randall Stephenson said that one of his company’s top priorities for 2019 is paying down the $40 billion in debt that it took on to acquire Time Warner. He said the company is on target to retire 75% of that by year end. AT&T has made other divestitures this year, including selling back its nearly 10% stake in Hulu and selling off its real estate holdings in Hudson Yards in Manhattan.
For Sinclair, the deal could strengthen even further its foothold in live sports.