News Corp. eyes YES Network

Regional sports net featuring Yankees games was founded in 2002

News Corp. may soon expand its sports empire with a stake in YES Network, one of the nation’s most watched regional sports nets, a person familiar with the situation said Thursday.

COO Chase Carey talks a lot about sports as tremendously valuable in a fragmented media world where live viewing is on the wane. While he dismisses rumors that News Corp. wants to go up against giant ESPN, Fox Sports is big and he’d like it to keep it growing. Yankees games would be a big draw, and News Corp. is in talks to buy a significant stake of the network that broadcasts games to 15 million subscribers, most likely from Goldman Sachs and Providence Equity. The net’s holding company, Yankees Global Enterprises, which owns the team and the channel, would likely retain its 34% stake.

YES, which stands for Yankees Entertainment and Sports, was founded in 2002 and is thought to be worth about $3 billion. Other original investors included YES’ first CEO Leo Hindery and billionaire Amos Hostetter, both former cable execs and former owners of the Nets, whose games are also broadcast on YES.

Goldman has been looking for a investor to buy it out since at least 2007.

A deal may bear the fingerprints of Rupert Murdoch’s son James, who is on the board of Yankee Global. James is based in New York now, and the company is carefully easing him back into more of an operational role after the phone hacking fireworks that erupted under his watch in the U.K.