ESPN has been in talks with some of professional sports’ most powerful leagues, including the National Football League, the National Basketball Association and Major League Baseball, about taking a minority stake in its business.
The cable network controlled by The Walt Disney Co. has held exploratory talks with leagues as it seeks to find a way forward in the streaming era, three people with knowledge of the matter said on condition of anonymity to describe private discussions.
Disney declined to comment.
Disney’s chief executive, Robert A. Iger said in a cnbc interview Last week the company was “looking for strategic partners” that could help ESPN with distribution or content. “But we want to stay in the games business,” said Mr. Iger, whose contract with Disney was recently extended until 2026.
Selling a stake in ESPN could provide Disney with cash as it faces costly renewal deals with sports leagues, including the NBA, that are sure to demand a premium for rights to show their games in the coming years. Hearst, which owns magazines such as Cosmopolitan and information services such as the Fitch Group, has a minority stake in ESPN.
ESPN — which has long been a profit center of Disney, which acquired the network in 1995 — has come under pressure in recent years as viewers cut the cable cord in favor of streaming services. Meanwhile, the cost of sports rights has been pushed up by new entrants including Apple, Amazon and YouTube. Trying to outrun deep-pocketed tech companies is a difficult prospect for cable networks whose businesses are in irreversible decline.
Disney executives have been insistent that ESPN’s future lies in streaming. Bloomberg And wall street journal It was recently reported that the sports network was laying the groundwork to make its primary channel, which has long existed only on cable, available to streaming viewers. This will be a turning point for traditional TV distributors, who have staved off decline by offering live sports to cable subscribers.
cnbc told earlier Professional sports leagues were in talks to take a stake in ESPN.
Disney has also faced pressure from a range of activist investors, including Trian Fund Management. The firm’s founder, Nelson Peltz, who had planned to pressure Disney to reform its succession plan, called off the fight for a board seat this year. The company owns about 6.4 million shares in Disney, said a person familiar with the size of the holdings, who spoke on condition of anonymity to discuss internal matters.
Brooks Barnes Contributed reporting.