By Richard Pagliaro | Wednesday, January 27, 2016
Tennis Channel CEO Ken Solomon, John Isner and TC analyst and coach Justin Gimelstob.
Photo credit: SportsBusiness Daily
Tennis Channel will soon have a new owner—and an expanded presence.
Sinclair Broadcast Group announced today that it has entered into a definitive agreement to buy Tennis Channel for $350 million.
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The deal will give more viewers access to the only network devoted solely to tennis. Sinclair’s acquisition will increase Tennis Channel's carriage from its current reach of about 30 million homes to approximately 50 million homes.
The sale, subject to antitrust regulatory approval, is expected to close in the coming weeks. Sinclair will finance the acquisition "through cash on hand and a draw on the Company’s revolving line of credit."
In a statement issued today announcing the agreement Sinclair said it "will benefit, however, from over $200 million of Tennis net operating losses which Sinclair will be able to carry forward to reduce future tax payments, the present value which Sinclair estimates to be worth approximately $65 million."
Last September, The Wall Street Journal reported Tennis Channel majority owners Apollo Global Management, Bain Capital Ventures, Battery Ventures, CCMP Capital and Columbia Capital, were in sales talks with Sinclair with an asking price "north of $500 million."
While the final sales price is well short of that, Sinclair provides Tennis Channel with a significantly larger media platform. Execs envision the added exposure and branding opportunities across multiple platforms creating increased ad revenue for both Tennis Channel and Tennis Channel Plus, the network's subscription companion channel.
“In Sinclair we have found the perfect owner-partner to accelerate scaling the Tennis Channel brand and our sport’s expanding fan-base to the next level," Tennis Channel CEO Ken Solomon said in a statement. "Sinclair’s unique size and position in the media ecosystem will facilitate significant distribution growth towards parity with our competitive set and expand our brand’s assets and unique value as the go-to destination for all things tennis in the U.S. and beyond.”
It is believed negotiations with Sinclair took place over the past year. The Sinclair management team will hold a conference call on Thursday morning to discuss details of the deal.
In a November interview with SportsBusiness Journal, Solomon said execs were not engaged in active talks to sell the channel.
“Let’s be clear: We are not talking to the market in terms of active sales with anyone,” Solomon told Daniel Kaplan of SportsBusiness Journal. “We are constantly talking about smart ways to grow the business. There is a real difference. We are not out in a process to sell the company."
Despite repeated denials rumors of negotations with Sinclair, as well talks with Fox, swirled in the past year.
Launched on May 15, 2003, Tennis Channel has added health and fitness, travel and pop culture programming to its tennis coverage.