Shares of Sinclair Broadcast Group (SBGI - Get Report) rocketed higher Monday after the company announced after that it will acquire 21 regional sports networks from Walt Disney (DIS - Get Report) valued at approximately $10.6 billion.
Sinclair stock jumped more than 30% on Monday to $58.66 on the New York Stock Exchange following the two companies' joint announcement late Friday that Sinclair will purchase 21 regional sports networks for $9.6 billion. The deal values the networks at $10.6 billion, after adjusting for minority equity interests.
The deal will make Sinclair the owner of the largest collection of regional sports networks in the U.S., giving it exclusive rights to 42 professional teams spanning Major League Baseball, the National Basketball Association and the National Hockey League, the companies said.
Disney was required to sell the regional sports networks under an agreement it struck with the Department of Justice that allowed it to proceed with its purchase of Twenty-First Century Fox.
"While consumer viewing habits have shifted, the tradition of watching live sports and news remains ingrained in our culture," Sinclair CEO Chris Ripley said in a statement. "As one of the largest local news producers in the country and an experienced producer of sports content, we are ideally positioned to transfer our skills to deliver and expand our focus on greater premium sports programming."
The deal does not include the YES Network, which broadcasts Yankees games for the New York City metro region. Disney is also required to sell that network.
According to the two companies, the 21 regional networks changing corporate hands generated $3.8 billion in revenue in 2018, and had 74 million subscribers.
The Sinclair-Disney deal is pending U.S. Department of Justice approval.
Shares of Walt Disney were down 0.2% at $134.06.
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