Sinclair Broadcast Group Inc. (SBGI, Financial) (0.1%) (SBGI – $33.22 – NASDAQ) operates through two segments, Sinclair Broadcasting Group(STG), which operates 190 television stations in 88 markets across the U.S., and Diamond Sports Group (DSG), which owns and/ or operates 23 regional sports network brands (RSNs) acquired from Fox in 2019, the Marquee Sports Network JV, and a 20% equity interest in the Yankee Entertainment and Sports Network (YES Network). The RSNs and YES Network own the exclusive rights to air, among other sporting events, the games of professional sports teams. While Sinclair’s net debt looks significant at just under $12 billion, roughly $8 billion is tied to the RSN business, and is non-recourse to Sinclair Television Group. As the advertising market rebounds and sports return to a more normalized schedule, Sinclair should benefit. Further, the company will soon begin participating in the monetization of sports betting through its partnership with Bally’s. As part of the deal, Sinclair also received warrants to acquire an equity stake directly in Bally’s.
From Mario Gabelli (Trades, Portfolio)'s Gabelli Asset Fund second-quarter 2021 commentary.
