NEW YORK -- The New York Yankees intend to form their own television network next season and value their broadcasting rights at about $1.4 billion over the next 10 years.

The team disclosed its plans in a letter submitted Friday to Madison Square Garden Network, which holds the team's television rights under a $486 million, 12-year contract that expires after this season.

MSG Network, a division of Cablevision Systems Corp., has a right-of-first-refusal in its current deal, and can block the Yankees from forming the network by agreeing before Sept. 18 to pay the team $1.4 billion over 10 years for the rights.

Harvey Schiller, the president of the Yankees' parent company, YankeeNets, confirmed the letter was sent to MSG but would not disclose the value placed on the deal. Two people familiar with the deal, speaking on the condition they not be identified, said the team's investment bankers valued it at $1.4 billion.

YankeeNets at first attempted to work out a deal with International Management Group's Trans World International division that would have combined the television rights of the Yankees with the NBA's New Jersey Nets, but MSG went to court and obtained an injunction on July 31 that blocked the deal.

New York Supreme Court Justice Barry A. Cozier said the Yankees had to give MSG a chance to match a deal containing only the baseball team's rights. The Yankees then hired Morgan Stanley Dean Witter Corp. to value what the value of forming their own network would be during the next 10 years.

"We submitted a new letter to MSG just a little while ago," Schiller said. "It put a value on network solely with the Yankees included. We tried to eliminate all the objections MSG and the judge identified."

If MSG declines to match the offer, YankeeNets would then be in position to start building its own network, one that probably one day would include broadcasts of YankeeNets' two other teams, the Nets and the NHL's New Jersey Devils.

If MSG matches the offer, the Yankees' would be guaranteed nearly three times as much money as in their current contract.

The network also could argue with the value placed on a Yankees network by Morgan Stanley, saying it should be lower.

"We are confirming that the network received the letter and we will be reviewing it," MSG Network spokeswoman Cara Taback said.

The Yankees, who have won three of the last four World Series, will have revenue of about $200 million this year, the highest in baseball, and have a payroll of about $112 million, also No. 1 among the 30 major league teams.