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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
COMMUNICATIONS
Rating: Baa3/BBB-/BBB-
- The WSJ yesterday reported that the NBA is close to securing a USD 76bn TV deal over 11 years with NBC, ESPN, and Amazon effective after the 2024/2025 season. WBD’s loss of the contract has been speculated upon though this report sounds more firm than previous. Estimates of the ad revenue loss go as high as USD 600mn (equiv to ~1.5% of FY23 revenue).
- WBD’s TNT and Disney’s ESPN currently pay USD 1.2bn and USD 1.5bn per year under the current deal that runs to the 2024-2025 season. The exclusivity agreement for re-negotiations ended in April.
- WBD are reported to have walked away from a USD 2.2bn deal. As per WSJ reports, Comcast’s NBCUniversal has submitted a USD 2.5bn bid while Amazon will pay USD 1.8bn and Disney USD 2.6bn.
- WBD claim matching rights against rival bids though it is unclear what obligation the NBA has to accept any marched offer, creating the potential for legal action. It also appears from the reported bids that they would set to pay a higher price than in the deal they walked away from.
- The WBD curve is much steeper than other media peers reflecting the sharp deleveraging path needed to maintain ratings.
- FY23 leverage of 3.9x (equiv. to 4.6x/4.9x at S&P/Moody’s) comes against a target of 2.5-3x. S&P need to see movement towards 3.5x (roughly equivalent to the midpoint of the reported target range) through 2025 for their stable outlook though Moody’s don’t see leverage on target until FY26.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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