(FOX 9) - Diamond Sports Group, the owners of Bally Sports North and other regional sports channels, announced Tuesday it has filed for Chapter 11 bankruptcy as the company restructures its debt.
The filing comes as the company has reached an agreement with its primary creditors to clear $8 billion in debt.
Diamond Sports Group says they plan to restructure and "strengthen its balance sheet" in the bankruptcy process. In the meantime, it says its Bally Sports networks will continue to broadcast without pause.
Pointing to $425 million in cash reserves, Diamond Sports Group says they are well-positioned to continue broadcasting through the bankruptcy process.
Bally Sports broadcasts games for a variety of teams across the country including, locally, the Twins, Wild, and Timberwolves. Due to concerns about the impending bankruptcy, the MLB had reportedly begun to develop backup streaming plans for several teams who feared losing their broadcasting rights contract with Bally during bankruptcy.
As part of the deal with its creditors, Diamond Sports Group will spin off from Sinclair to become a standalone company.
In a press release, CEO David Preschlack says bankruptcy and restructuring will allow the company to succeed in the long term.
"The DSG Board of Managers has been evaluating strategic opportunities with the support of its advisors and in coordination with creditors to position the Company for long-term success and has determined that the best path forward for the Company and its stakeholders is to restructure through a Chapter 11 process. We are utilizing this process to reset our capital structure and strengthen our balance sheet through the elimination of approximately $8 billion of debt. The financial flexibility attained through this restructuring will allow DSG to evolve our business while continuing to provide exceptional live sports productions for our fans," said Preschlack. "DSG will continue broadcasting games and connecting fans across the country with the sports and teams they love. With the support of our creditors, we expect to execute a prompt and efficient reorganization and to emerge from the restructuring process as a stronger company."
Diamond Sports Group says its first order of business in bankruptcy will be to ensure workers will continue to receive paychecks and customers won't be impacted.