Disney’s closing in on a deal to buy a one-third stake in MLB Advanced Media’s tech arm, BAM Tech, with a four-year option to buy another third, under terms that value the enterprise at $3.5 billion Bloomberg reports, citing “a person familiar with the matter.”
A deal would give the ESPN owner a stake, and possibly control, over the power behind independent streaming initiatives including WatchESPN, WWE Network, HBO Now, and Glenn Beck’s The Blaze TV.
Baseball’s 30 teams own MLBAM. But with its dramatic growth under CEO Bob Bowman, many have wondered how long it would be before MLBAM went public or sold to a deep-pocketed backer.
WME-IMG was also interested in the one-third stake, Bloomberg says. Private equity firm Silver Lake Partners also took a look, Recode reported last month.
Disney’s digital deal might reassure investors who have questioned the prospects for ESPN, the company’s cash cow, as cable subscriptions and viewing decline. The company’s share price is down nearly 15% over the last 12 months.
In a report this morning Drexel Hamilton’s Tony Wible said he believes that “fears over ESPN are overblown as we believe affiliate fee rates will disproportionately move higher for sports networks like ESPN at the expense of other non-sports media networks.”