Last month we told you that Disney would like to invest in BAM Tech, the video tech business that pro baseball’s MLB Advanced Media unit would like to spin off.
It still does. Here’s a brief update: Disney is willing to write a very big check to buy into BAM Tech.
Industry sources believe Disney is looking to acquire as much as one-third of BAM Tech, at a valuation approaching $3 billion, with “path to control” that would eventually allow it to acquire a controlling interest in the business.
That is: Disney would be paying up to $1 billion for its stake in the company, with the possibility of more investment down the road.
If Disney ends up spending anything close to that level, it would represent the company’s biggest bet on digital video to date. In 2014, Disney acquired Maker Studios, in a deal that ultimately saw it pay out $675 million for the YouTube video network.
But Disney doesn’t have a deal yet. Sources say other potential bidders, including private equity shop Silver Lake Partners, are still looking at the video spin-off. Disney, MLBAM and Silver Lake reps declined to comment.
BAM Tech is MLBAM boss Bob Bowman’s attempt to extract value for the video infrastructure business he has built up over the past few years. The company started by powering streaming services for baseball’s 30 teams, but has since started handling clients that range from Disney’s ESPN to Time Warner’s HBO. Disney would presumably be interested in owning the company so it could build out its own direct-to-consumer streaming services.
Bob Bowman explains the difficulty of maintaining streaming services
This article originally appeared on Recode.net.