Business & Money

Ice Cube, BIG3 outbid for Regional sports networks

By Bryan 18X Crawford -Contributing Writer- | Last updated: May 1, 2019 - 2:17:19 PM

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BIG3 founder and legendary West Coast rapper Ice Cube was outbid in an auction for 21 regional sports networks (RSN) currently owned by Disney after its purchase of network TV giant FOX.


According to FOX Business, Sinclair Broadcasting emerged as the frontrunner in the auction which began last November, bidding very close to $10 billion. FOX Business reported that Sinclair and Disney had reached “a handshake agreement” on the sale of the networks. This is Sinclair’s most recent foray into its attempt to purchase smaller, individual TV networks. Last summer, Sinclair looked to buy 42 stations being sold off by TribuneMedia, but that effort was blocked by the Federal Communications Commission. Sinclair currently owns over 200 stations across more than 100 U.S. markets.

Others bidding against Ice Cube and his upstart BIG3 company include Major League Baseball (MLB), in partnership with Liberty Media. Charter Communications, which at one point in the bidding process had discussions with Ice Cube and the BIG3 about continuing to carry the channels should they become the group to win the auction, broke off those talks and then threatened to drop the 21 RSN’s should they change hands, effectively lowering the asking price significantly from the $20 billion valuation Disney initially placed on the RSN package. This move prompted Ice Cube to approach the FCC and the Department of Justice and ask the two organizations to investigate Charter’s attempted manipulation of the bidding process, which ironically, benefits Liberty Media, one of Charter’s largest shareholders.

The BIG3, the antitrust division of the Justice Dept., and the FCC, met on April 17 to discuss the allegations made by Ice Cube against Charter Communications, two days after final bids were due for the RSN’s. The outcome of that meeting has yet to be announced publicly.

Sinclair Broadcasting’s bid is said to be the strongest. The media company offered up most of its nearly $10 billion bid in cash. However, the company is still in the process of trying to secure additional equity partners in an attempt to officially close the deal. JP Morgan has offered Sinclair a bridge loan, while Apollo Global Management and The Blackstone Group are being targeted by Sinclair as potential equity partners in the deal. Ice Cube’s diverse investment group of other athletes and entertainers also includes corporate powerhouses such as financial investment firm Centerbridge Partners in New York, Australian investment firm Macquarie Group, and Rhode Island- based Carolyn Rafaelian, the richest jeweler in the United States. Ms. Rafaelian, Macquarie Group and Centerbridge Partners, each pledged $1 billion, with the BIG3 putting up between $350 million and $500 million, in the group’s bid for the RSN’s. It is worth noting that while the BIG3 is still not out of the race as of yet, their bid is heavily leveraged by more debt than actual equity.

Still, until Disney and Sinclair can agree on terms and conditions of the sale, nothing is official. This means that there is still an opportunity for a late-game bidder to make a push for the networks, as well a chance for Ice Cube and the BIG3 to come back to the table with a more competitive bid. The total price for the networks, at present, is nearly $13.5 billion.