Team Ownership: Mariners Reach Deal with DirecTV for New RSN Partnership

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If the Yankees and Dodgers can do it, why not the Seattle Mariners? The MLB team has purchased a majority stake in DirecTV -owned Root Sports Northwest, with the 2 creating a new venture that they’ll jointly own. DirecTV, which owns and operates 2 other RSNs in Denver and Pittsburgh, assumes a minority position and will continue to oversee day-to-day management of the net. The Root Sports branding also remains. The agreement has Mariners baseball on the net through the conclusion of the ’30 MLB season. It nixes any hopes Comcast may have had about stealing the rights away. The Mariners signed a 10-year deal (reportedly for $450mln) with DirecTV in ’11, but had the right to opt out of the deal after the ’15 season. Teams and conferences are increasingly looking for a bigger bite for their TV rights, with the Dodgers- Time Warner Cable deal—reportedly worth between $7bln-$8bln—egging it on. On Tues, ESPN and the Southeastern Conference were slated to announce the launch of their channel, but canceled the media event in Atlanta in light of the Boston Marathon attacks. The 1st conversations were held in late ’10, according to Bob Aylward, Mariners evp, biz ops. "It’s amazing to me how off the radar the negotiations have been, and I think that’s a reflection of both the desire of DirecTV and the Mariners to expect the confidentiality of the non-disclosures," he said. No specifics were given on the deal, with Aylward simply saying that the team made a "substantial investment" in the venture. Forbes estimated the value at $2bln. NY investment bank Allen & Co advised the Mariners on the transaction. Allen & Co’s Steve Greenberg said the deal was less risky than going it alone with a 100%-owned net that would have to strike carriage deals (a la Dodgers) and that by having a majority stake, the Mariners will get more than just rights fees. Root Sports Northwest currently reaches about 3.2mln homes. This season, the net provides coverage of 159 games.

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