Source: News Corp. Will Pay Yankees $500M As Part Of YES Deal
News Corp. will pay the Yankees $500M as part of the media company’s purchase of 49% of YES Network, a source said. The $500M, which was a separate inducement to get the Yankees to agree to sell the stake, is subject to MLB revenue sharing. The first $300M is due upon closing of the deal, which was announced today, and $200M in three years, the source said. The network is valued at $3B, but if News Corp. in three years exercises its option to increase its stake to as much as 80%, the valuation jumps to $3.8B, the source said. As part of the deal, the Yankees secured a rights extension through '42 that, due to accelerators in the contract, will pay the team $300M that final year, up from $85M this year.
The Yankees’ stake in YES Network is declining from 34% to 25% as part of the deal, while private equity companies Goldman Sachs and Providence Equity will keep about 10% each. Former owners of the Nets will own the remainder. The source said even if News Corp. takes control of the channel, the Yankees will retain control over the broadcast of their own games.