CSN Houston Has a New Owner...Maybe

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And the new partial owner of CSN Houston is...
So it comes to pass that DirecTV and AT&T U-verse were the mystery parties attempting to purchase CSN Houston out of bankruptcy. It was revealed in court papers filed late on Wednesday night that, should the court accept the network's bankruptcy reorganization plan, DirecTV and U-verse will together own 100 percent of the failed network. Both companies will also add the network to their distribution lineup.

The Astros and Rockets will both sign new media rights deals with the new entity, and both will forget about collecting the amount they are due under the media rights deal with CSN Houston. Comcast will have neither an ownership nor a management stake in the network, but it does appear that Comcast will continue to carry the network on its system.

But all of the above is still a big if. Now that the joint DirecTV/U-verse bid has been made public, other parties can attempt to make bids on the network, including Comcast. And there are still a lot of unknowns. So while we're waiting for the final outcome, here are a few items to watch:

1. THE TRUTH COMMISSION

As part of the reorganization plan, a Litigation Trust will be created with the primary goal of liquidating the network's assets. Among the other issues to be handled by this trust will be the pursuit of certain causes of action against various Comcast entities arising from the bankruptcy. These causes of action would include such items as exerting undue influence or control on the network; attempting to obtain network ownership at a severely artificially depressed price, and imposing enforced losses upon creditors.

The Rockets and Astros stated in the Disclosure Statement that "they have since learned that, notwithstanding, its contractual obligation to do so, Comcast Services did not engage in any negotiations with any MVPD [cable/satellite distributors] to obtain additional carriage since the Commencement Date...and that Comcast Services was in possession of material adverse information with respect to the Network's inability to obtain additional carriage which it did not share with any representative of any of the Partners...other than with the Comcast Partner."



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