The National Football League (NFL) has agreed a deal with the Walt Disney Company to acquire a 10 per cent stake in ESPN.
The non-binding agreement between the NFL and the Walt Disney Co. aims to set a new standard for how professional football is delivered, experienced and celebrated by fans.
The agreement will see ESPN acquire the NFL Network and certain other media assets owned and controlled by the NFL, including NFL’s linear RedZone Channel and NFL Fantasy, in exchange for a 10 per cent equity stake in ESPN.
This will be supported by a secondary agreement under which the NFL will license certain NFL content and other intellectual property to be used by NFL Network and other assets.
“Today’s announcement paves the way for the world’s leading sports media brand and America’s most popular sport to deliver an even more compelling experience for NFL fans, in a way that only ESPN and Disney can,” said Robert A. Iger, CEO of The Walt Disney Company.
“Commissioner Goodell and the NFL have built outstanding media assets, and these transactions will add to consumer choice, provide viewers with even greater convenience and quality, and expand the breadth and value proposition of Disney’s streaming ecosystem.”
As a result of the deal, NFL programming will be available on more platforms than ever before, including ESPN’s upcoming direct-to-consumer service, while remaining on cable, satellite and leading streaming providers.
Under the terms of the agreement, ESPN will own and operate the NFL Network, alongside owning broad rights to the RedZone brand for distribution to pay TV channels, while NFL Fantasy Football will merge with ESPN Fantasy Football to create the official Fantasy season-long game of the NFL.
ESPN’s platforms will also license an additional three NFL games per season to air on NFL Network.
“Since its launch in 2003, NFL Network has provided millions of fans unprecedented access to the sport they love,” said NFL commissioner Roger Goodell. “Whether it was debuting Thursday Night Football, televising the Combine, or telling incredible football stories through original shows and breaking news, NFL Network has delivered. The Network’s sale to ESPN will build on this remarkable legacy, providing more NFL football for more fans in new and innovative ways.”
The transactions are subject to negotiation of definitive agreements, various approvals including by the NFL team owners, and customary closing conditions.
Jimmy Pitaro, chairman of ESPN, commented: “This is an exciting day for sports fans. By combining these NFL media assets with ESPN’s reach and innovation, we’re creating a premier destination for football fans.
“Together, ESPN and the NFL are redefining how fans engage with the game—anytime, anywhere. This deal helps fuel ESPN’s digital future, laying the foundation for an even more robust offering as we prepare to launch our new direct-to-consumer service.”
ESPN is currently 80 per cent owned by Disney subsidiary ABC, Inc. and 20 per cent by Hearst.
ESPN has a 10-year agreement with PENN Entertainment under which PENN operates the ESPN Bet sports betting brand, with ESPN receiving cash payment of $1.5 billion over the term of the contract alongside approximately $500 million of warrants to purchase approximately 31.8 million Penn common shares.