News Corp. is in talks to acquire a stake in the Yankees cable channel YES. (Getty Images )
News Corp. is in negotiations with the New York Yankees to buy a minority stake in the team's YES cable network, positioning the media company to gain a larger footprint in the increasingly lucrative realm of sports programming.
Talks between News Corp. and the New York Yankees have been going on for several weeks, people with knowledge of the situation said. Under the terms being discussed, News Corp. would likely acquire the stakes in YES held by the investment bank Goldman Sachs, private equity firm Providence Equity Partners and other owners. The YES Network has been valued at as much as $3 billion.
For News Corp., getting a piece of YES would give it a big presence in the nation's No. 1 media market, where it currently has no sports outlets. An agreement could be finalized as early as later this week. Financing the deal won't be an issue for News Corp., which has over $10 billion in cash.
A News Corp. spokeswoman declined comment.
News Corp. already owns 20 regional sports networks, including two in Los Angeles. The company is also in the process of starting a national cable sports network to challenge Walt Disney Co.'s ESPN. The tentative name for the national service is Fox Sports 1. It also owns about 13% of the Colorado Rockies baseball team.
Getting a big stake in YES also ensures that the cable network won't fall into the hands of a rival such as Time Warner Cable, which recently launched its own regional sports channel in Los Angeles -- and which is now competing with Fox there.
YES currently charges pay-TV distributors about $3.00 per-subscriber, per-month, according to industry consulting firm SNL Kagan. Besides the Yankees, YES also carries Brooklyn Nets basketball.
News Corp. President and Chief Operating Officer Chase Carey is a huge Yankees fan and is often seen sitting behind the home team's dugout, particularly when the team is in the postseason.
Cox Cable strikes deal with Time Warner for Lakers
Dodgers a factor in negotiation for Lakers channel
AT&T strikes deal for Time Warner Cable's Lakers channel
INTERACTIVE: TVs highest paid stars
QUIZ: Celebrity voice overs
PHOTOS: Hollywood back lot moments