Rapper, actor and entrepreneur Ice Cube is seeking additional financing power to make a bid for the 22 Fox Regional Sports Networks currently being shopped around and has called on troubled media giant Viacom to provide some of the cash necessary to make an offer that would compete with the likes of Sinclair Broadcasting, FOX Business has learned.
Continue Reading Below
At least at the moment, it’s unlikely Viacom and its CEO Robert Bakish will eventually join forces with the hip-hop star and rock-and-roll hall of famer, whose given name is O’Shea Jackson Sr., though sources close to both parties say the two sides have held discussions on the matter.
A person with knowledge of Bakish’s thinking say he has been approached by a number of individuals for a possible bid on the sports networks, but remains uninterested in bidding at least for the moment though that may change. One impediment to a potential Viacom bid on the RSNs is that Bakish is focused on rebuilding Viacom, and some of its properties like MTV, which have lost audience share over cord cutting and other industry trends.
Bakish’s future as CEO of Viacom is also unclear; the media company is controlled by Shari Redstone’s National Amusements Inc., started by her father Sumner, and has been pushing for a merger with CBS, the other media company the family controls.
Ice Cube’s talks with Viacom to purchase the RSNs have not been previously reported and people close to the rapper say he’s also approached others about joining his bidding team.
The regional sports networks, known as RSNs, must be sold as part of Disney’s $71 billion purchase of Fox’s entertainment assets to meet federal regulatory requirements since Disney already owns the giant cable sports network, ESPN.
|DIS||WALT DISNEY COMPANY||142.02||+1.10||+0.78%|
Disney is handling the sale with the firms Allen & Company and JPMorgan Chase conducting the auction. The auction is in its second round and scheduled to conclude by in the coming weeks, according to sources close to the matter.
A spokesman for Ice Cube had no comment; A spokesman for Disney had no comment.
However, Ice Cube, whose Twitter bio is West Coast Warlord, did, tweeting to FOX Business's @cgasparino that he is “more than a rapper” in a response to our story.
Bankers are telling people they have as many as six parties, including Ice Cube’s group interested in snapping up all the networks—and Disney initially sought as much as $20 billion for the entire package of RSNs, which includes the lucrative Yankees Entertainment Network, also known as YES.
The RSNs value was based on what Disney paid for the Fox assets, which includes all of 21st Century Fox, except Fox News, FOX Business, Fox Sports, Fox TV Network and its owned and operated affiliates. The new company will be known as "New Fox" which will be the parent of FOX Business and Fox News.
But as previously reported by FOX Business, the bidding has hit a number of snags; most of the interest came from parties looking to snap up the RSNs at a low-ball price. Industry trends show declining cable profitability due to cord-cutting and sports leagues maintaining ownership (rather than the networks), of the all-important digital rights for games to be viewed on wireless devices, all of which has driven the initial bids for all the networks to fall short of $20 billion. A deal excludes the digital rights currently held by Major League Baseball.
So far the leading bidder to snap up all of the network appears to be Sinclair Broadcast Group, though people say the company’s price tag is below $20 billion.
If Ice Cube does get the financing for a bid, he could add an interesting new element to the sale and increase the overall price tag for the RSNs. People with knowledge of Ice Cube’s intentions say the bid could be done through his BIG3 basketball league—a new league he created of former NBA stars who play three-on-three playground ball. Some of his stars include NBA Great Julius “Dr. J” Irving—now a coach—and and player Amar’e Stoudemire.
An update on his plans to bid on the networks could come imminently.
Ice Cube announced his intentions in a December 11 Rolling Stone piece where he stated that “I’m trying to buy 22 regional sports networks. That’s all my head is about. I believe that some of the gatekeepers that’s been holding the reins in sports over us for so long need to go. It’s time for some new blood to produce and present sports and culture, not only to America but the world.”
But people close to the bidding process said at least, until recently, he likely didn’t have all the financing lined up; that might change, of course, if Viacom or another player joins his bid.
Meanwhile Amazon continues to negotiate to purchase a piece of YES, which is considered more valuable than the other networks given the Yankees' national stature, according to people with knowledge of the matter. Amazon may bid on the other RSNs at some later date, FOX Business has learned, but the company led by Jeff Bezos has not put in a first round bid for the remaining networks, these people add. In a recent FOX Business interview, Major League Baseball Commissioner Rob Manfred confirmed Amazon’s interest, as well as the MLB’s.
The Yankees are in process of buying back the portion of YES that is now in Disney’s hands based on a change in a control provision following the 21st Century Fox deal. Amazon will likely be part of a larger group of owners, but will have the ability to stream Yankee games if the deal is reached.