The Yankees and the Nets are expected to announce today
"a joint ownership agreement that would merge their business
operations -- including television rights, marketing,
sponsorships and advertising -- and unite two disparate
ownership groups," according to sources of Richard Sandomir
of the N.Y. TIMES. In the deal, the teams "are expected" to
form a 50-50 ownership arrangement which would have them
both exchange some stock and the Nets pay some cash.
However, it is "unclear" whether current Yankees and Nets
execs "would maintain separate day-to-day control of the two
teams' on-the-field moves." Sandomir writes that the
"greatest potential" of the merger could be "the impact on
upcoming cable TV negotiations." The Yankees are beginning
their 11th year of a 12-year, $486M contract with MSG, while
the Nets contract with Fox Sports NY, another Cablevision
entity, ends after the 2001-02 season. If the Yankees were
to partner with the Nets, they "could create unprecedented
leverage" in their renewal talks with Cablevision. A
Yankees-Nets union would also allow it to "hold out the
possibility that it could launch its own local sports
channel to compete with Cablevision's," or form its own
channel by striking a deal with Time Warner or ESPN. The
merger "ends speculation" that the Yankees would be acquired
by Cablevision (N.Y. TIMES, 2/25). The Bergen RECORD's John
Brennan also has the story and writes: "The ramifications of
a merger would be enormous. For instance, a combined
Yankees-Nets conglomerate would have considerable leverage
in talking with New Jersey officials about the future home
of both teams" (Bergen RECORD, 2/25).
