Earlier this year, the Lerner family began exploring a sale of the Washington Nationals. Since then, it has become clear that the regional sports network Mid-Atlantic Sports Network (MASN) has created a potential roadblock to selling the Nationals. Now, Major League Baseball has stepped in to resolve the issues created by MASN and help facilitate a sale.
When Major League Baseball, which owned the Montreal Expos, proposed moving the team to Washington in 2004, Orioles owner Peter Angelos raised concerns over sharing territory with the Nationals. Thus, Major League Baseball reached an agreement with the Orioles to form MASN, giving the Orioles an initial 90 percent stake in the network and the Nationals a 10 percent stake. After two years, the Nationals’ stake would increase by 1 percent each season until the Nationals’ stake reached 33 percent. Initially, the teams would be paid the same rights fees by MASN, which the parties could revisit every five years.
The agreement did not have a termination date and explicitly states that “all subsequent purchaser(s), assignees or transferees shall be unconditionally bound to all terms and conditions of [the] [a]greement.”
In 2012, the first year the Nationals could renegotiate rights fees, the team argued that they were not paid fair market value from MASN for their rights. After failing to come to an agreement, the Nationals took the issue to arbitration. In 2019, a Major League Baseball arbitration panel awarded $105 million to the Nationals. MASN has appealed the award to a New York appellate court, arguing that the panel was not impartial.
Monumental Sports and Entertainment Owner Ted Leonsis is the leading candidate to purchase the Nationals. Leonsis owns the Washington Capitals, Wizards, and two-thirds of NBC Sports Washington. Therefore, if Leonsis were to purchase the team, it is likely that he would prefer to move the Nationals’ rights to NBC Sports Washington.
With the deal being in perpetuity, the only way to move the Nationals’ rights would be to buy out the rights from the Orioles-controlled MASN. Angelos likely would have no interest in selling the Nationals’ rights without a significant payday. On top of the buyout, the sides would have to resolve the pending litigation—potentially costing a buyer to forfeit the arbitration award in exchange for television rights.
Thus, the delay in selling the Nationals is not because of a lack of interest. Instead, the Orioles may be holding up the sale via MASN and controlling the Nationals’ broadcast rights. The Nationals will fetch billions from a buyer if the issue gets resolved.