Sinclair Inc. said its bankrupt local sports unit Diamond Sports Group will probably shut down after the end of Major League Baseball’s 2024 regular season under a new proposal between the subsidiary and its creditors, Bloomberg News reported. The liquidation of Diamond would represent the end of a relationship that has been fraught and short. Sinclair acquired Diamond from Walt Disney Co. in 2019. The deal, valued at around $10.6 billion according to court papers, was designed to turn Sinclair into a cable sports powerhouse. But revenues from cable television have plunged in recent years as more consumers rely on Internet-based services. Diamond, which has its own management, filed for bankruptcy in March, and sued Sinclair in July, accusing the company of siphoning off money, a claim its parent denies. Diamond is working to finalize what would be essentially one-year deals that would permit it to broadcast its full slate of National Basketball Association and National Hockey League games for the current season as well as next year’s regular season games for Major League Baseball. After that, Diamond’s deals with MLB, NBA and NHL would end, the the operator of the Bally Sports brand of local sports channels has said. Diamond may liquidate next year if it can’t find a way to keep the company operating beyond 2024, Andrew Parlen, a lawyer for the company, said on Wednesday. Sinclair, now operating independently of Diamond, sees that as the most likely outcome, lawyer David R. Seligman said separately.
