August 21, 2024

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Business mogul Edgar Bronfman Jr. could shake up the Paramount sales process. How is CBS Sports approaching its parent company’s uncertain status?

— Eric Fisher [[link removed]], Colin Salao [[link removed]], and David Rumsey [[link removed]]

New $4.3 Billion Paramount Bid Puts Future of CBS Sports in the Balance [[link removed]]

Ron Chenoy-USA TODAY Sports

The long-term structure of CBS Sports’ parent company is once more in question as a new bid has emerged for control of Paramount Global.

Six weeks after National Amusements, the Shari Redstone family company that controls Paramount, agreed to a complex merger deal [[link removed]] with Skydance Media worth more than $8 billion, veteran media executive Edgar Bronfman Jr. has submitted a separate, $4.3 billion bid to take over the company.

The new offer is within a 45-day “go-shop” period contained within the Skydance deal that allows Paramount’s board of directors to seek alternate bids—a window that ends Wednesday. Bronfman’s pitch is that his offer is superior to the Skydance proposal, is much simpler, and is ultimately not as dilutive to Paramount shareholders compared to the contemplated Paramount-Skydance merger agreement.

Bronfman’s offer also includes a $400 million breakup fee that would be paid to the David Ellison–led Skydance if Paramount accepts. A special committee of Paramount’s board is expected to meet Wednesday to evaluate the Bronfman bid. The executive has raised $5.5 billion, according to multiple reports, on the expectation of ultimately raising his offer.

“Our proposal eliminates the risks, uncertainties and costs of combining Paramount with Skydance,” Bronfman wrote in a letter to Charles Phillips, chair of Paramount’s special committee of directors. “We believe Paramount is most valuable as a standalone business.”

Steady As She Goes

CBS Sports, for its part, is attempting to stay out of the corporate fray and focus on continuing to deliver audiences far larger than anything else that Paramount offers. A key part of that is the network’s NFL rights, the ratings of which CBS Sports aims to increase [[link removed]] this season—even after the across-the-board viewership growth recorded in 2023.

“We’re still in this ‘go-shop’ window … and there’s going to be a year of regulatory review [in any deal]. So we have to go through all those things,” CBS Sports president and CEO David Berson said last week. “But as it pertains to sports, even on the call announcing the [initial] deal, you heard from Skydance and RedBird [Capital Partners] how they value sports, how they believe in sports. They love our portfolio. They love our strategy. They love our team. So we’ll have to see how everything plays out, but it’s exciting to see the interest they have, the appreciation they have, for sports.”

Bronfman is also the executive chairman of FuboTV, which is locked in a bitter legal fight [[link removed]] against Venu Sports. That streaming bundle, currently prohibited making its public debut, is backed by Disney, Fox, and Warner Bros. Discovery—companies that Bronfman would be competing directly against should he gain control of Paramount.

Editors’ note: RedBird IMI, of which RedBird Capital Partners is a joint venture partner, is an investor in Front Office Sports.

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Las Vegas, Seattle NBA Expansion Fees May Soar As Team Values Climb [[link removed]]

Brian Fluharty-USA TODAY Sports

On Sunday, Bill Simmons said on his podcast [[link removed]] that Amazon founder Jeff Bezos may explore a purchase of the Celtics, who were put on the market [[link removed]] by owner Wyc Grousbeck and his partners last month.

According to The Information [[link removed]], Bezos “has no plans” to bid on the Celtics. However, lost in Simmons’s report was the price tag that the league hopes the iconic franchise will fetch, whether from the billionaire Bezos or any prospective buyer.

“The league wants $6 billion for the Celtics. Six billion dollars, [and] they don’t own their arena. It’s a crazy price, but they’re probably going to get it,” Simmons said.

Simmons added that the NBA is hoping for the sale price to hit $6 billion so it becomes the new benchmark for expansion fees. Commissioner Adam Silver has made it no secret that the league is moving toward expansion for the first time since 2004, with the prospective markets being Las Vegas and Seattle.

Bloomberg reported [[link removed]] last month that expansion fees could be somewhere between $4 billion and $5 billion—and that’s without considering the cost of building a new arena. That fee is in line with the price tags of the three NBA teams sold last year—$3.5 billion for the Mavericks, $3 billion for the Hornets, and a league-record $4 billion for the Suns—but Simmons’s prediction for the Celtics would significantly overshoot those prices.

To the Moon

Regardless of whether Simmons’s prediction comes true, the sale of the Celtics will likely surpass the Suns’ as the largest in NBA history, as long as it comes close to their October 2023 valuation of $4.7 billion, according to Forbes [[link removed]].

Franchises often overshoot their valuation when they are sold, such as the Suns who were valued at less than 70% of its eventual sale price. However, the opposite does happen, like when Mark Cuban sold the Mavericks to the Adelson family at a valuation that was around 77% of its estimated value.

Team valuations surged after the current media-rights deal began in 2016, and the prices of the sales over the past few years indicated an expectation that there would be another bump.

Some teams have also become more valuable by building and operating their own arenas. In 2010, Joe Lacob purchased the Warriors for $450 million, which was $100 million less than what Ted Leonsis paid for the Wizards. However, the Leonsis purchase included the team’s arena. The Warriors are now recognized as one of the most valuable teams in all of sports, largely due to their on-court success over the last decade, but also thanks to their decision to move to the Chase Center in 2019.

Trending Up

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NBA franchises, as with most major sports teams, have skyrocketed in value over the past decade as league revenue has shot up. The biggest revenue driver has been the media-rights deals, which went from less than $1 billion per year from 2007 to 2016, to about $2.7 billion per year from 2016 to 2025, to what will be around $7 billion annually from 2025 to 2036.

FRONT OFFICE SPORTS TODAY Top-Ranked Player Calls for Union

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Top-ranked U.S. male tennis player Taylor Fritz said that tennis players “absolutely” should have a union and that players are losing money and benefits due to their lack of representation. He also opined on the need for replay in tennis and reacted to the news of world No. 1 Jannik Sinner testing positive twice for a banned substance.

Plus, we check in on some of the big news in sports media, including Mike Greenberg’s taking over as host of ESPN’s Sunday NFL Countdown, and we hear from FanDuel cofounder Nigel Eccles.

Watch, listen, and subscribe on Apple [[link removed]], Spotify [[link removed]], and YouTube [[link removed]].

LOUD AND CLEAR Enough Is Enough

The Oklahoman

“Tell your agent to quit calling us and asking for more money.”

—Oklahoma State football coach Mike Gundy (above), on what his message is to players who are seeking deals around name, image, and likeness ahead of the college season. “It’s non-negotiable now,” Gundy added. “Start again in December.” Gundy was voicing his frustration with the transfer portal to reporters [[link removed]] as the Cowboys prepare their season opener against South Dakota State on Aug. 31.

Gundy’s comments came before Oklahoma State announced the rollout of a new initiative [[link removed]] that will see football players’ helmets be fashioned with QR codes that link to the website of the school’s official NIL collective, Pokes With A Purpose, where monetary donations can be made.

FRONT OFFICE SPORTS EVENTS

Your Chance to Hear From Val Ackerman

On Sept. 10, Front Office Sports is bringing together leaders within the sports media space for our inaugural sports media summit, Tuned In [[link removed]].

Join us as we sit down for intimate conversations with some of the industry’s biggest newsmakers. Speakers will represent organizations from ESPN, Roku, NBCUniversal, and more. Newly added to the lineup of impressive speakers is Val Ackerman, commissioner of the Big East Conference.

Conversations will cover a plethora of topics from media rights and streaming, to sports betting, athletes-turned-media moguls, and more.

Don’t miss out on your opportunity for exclusive insights and elite networking.

Register now [[link removed]] while there is still space.

Conversation Starters NFL Sunday Ticket is getting an upgrade this season as YouTube TV is integrating more customizable multiview options for NFL games. Take a look [[link removed]]. Included in the House v. NCAA settlement proposal is an entire section that would put unprecedented restrictions on name, image, and likeness collective deals. Find out more here [[link removed]]. ESPN+ had a dedicated camera tracking Kylian Mbappé during his LaLiga debut Sunday. Check it out [[link removed]]. Editors’ Picks Doping Slap on Wrist Still Costs Jannik Sinner $325K [[link removed]]by Margaret Fleming [[link removed]]The world No. 1 tested positive for steroids twice in March. Josh Harris, David Blitzer Have Offloaded Their Chunk of Steelers [[link removed]]by A.J. Perez [[link removed]]Harris and Blitzer are down to just one team now. Everything to Know About the 12-Team CFP Era [[link removed]]by Amanda Christovich [[link removed]]The expanded playoff will include several elements never seen before in FBS. Question of the Day

Do you think college athletes should be able to negotiate new name, image, and likeness deals during the season?

Yes [[link removed]] No [[link removed]]

Tuesday’s result: 71% of respondents think the Celtics will fetch the reported $6 billion price they (and the NBA) want.

Advertise [[link removed]] Awards [[link removed]] Learning [[link removed]] Video [[link removed]] Podcast [[link removed]] Sports Careers [[link removed]] Written by Eric Fisher [[link removed]], Colin Salao [[link removed]], David Rumsey [[link removed]] Edited by Matthew Tabeek [[link removed]], Or Moyal [[link removed]], Catherine Chen [[link removed]]

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