Fortune Magazine believes that the YES Network could be for sale, estimating that the entire cable network could be worth up to $3 billion. The television home of the New York Yankees and the New Jersey Nets is currently owned by Yankee Global Enterprises, Goldman Sachs Group and Providence Equity Partners and an investment group headed by former Nets owner Ray Chambers.
It is believed that the Goldman and Providence Equity tandem would like to sell their piece, along with Chambers’ group. Yankee Global Enterprises, which owns the team, currently has a 35% stake in the cable network; it is not believed that they will purchase the remaining 65%.
“We’ve owned the network for the past six years. All we’re doing is getting a current view from the marketplace on the network’s value,” Goldman Sachs spokesman Peter Rose said Thursday to The Associated Press. “From Goldman Sachs’ perspective, we have made no decision to sell. If we got an offer that in our view reflected the premium value of the network, we would consider it.”
YES brought in $340.5 million in revenue last year, according to Kagan Media Research estimates, which believes that $136 million equated to free cash flow. If that were the case, the network is valued around $3 billion based on 19 times cash flow, which is standard for other regional sports networks.
Talk of selling YES has brought up speculation that George Steinbrenner may next try to sell the team. His family has been the majority owner of the club since the 1970s but he claims there is no intention of selling now. Yankee Global Enterprises will keep its 35% stake, using the significant revenues to help pay for the most expensive payroll in baseball.
Additionally, the Yankees are in the midst of building a $1.2 billion stadium directly across the street from the current one. With the cable network’s value rising each year, plus revenue from the new ballpark, the exorbitant spending by the Yankees should only continue into the future.