English football spiralled into the first stages of a
financial crisis last night as Setanta's rescue bid ran out of
time. The Premier League had given the sports subscription network
until the close of business yesterday to come up with the latest
instalment of £10million - or they would reclaim the two packages
of 46 games from their current deal and sell them
elsewhere.
The end for Setanta came with a terse Premier League statement
at 18 minutes past six which 'terminated their existing licence
with immediate effect'.
The major losers are likely to be the FA, who could face a £100m
black hole in their finances. They are just concluding their first
season in a four-year deal for England and FA Cup rights. Setanta's
share was £150m and the FA have no hope of recouping anything like
that sum.
It is understood that Sky Sports, Channel 4 and the Disney-owned
ESPN have already alerted the Premier League about their interest
in buying the two packages available for next season. ESPN, who
have been circling the PL for some time, are the most likely
successful bidders, although Channel 4 would bring live action from
the Premier League to terrestrial TV for the first time.
The future of Setanta remains uncertain, as does the rest of
their sports portfolio and their one set of 23 PL games for the
three years starting with the 2010-11 campaign.
Administration now looks inevitable following the collapse
yesterday of Russian billionaire Len Blavatnik's proposal to buy 51
per cent of the business for £20m through his Access Industries
media arm.
Turn off: Setanta are on the verge of collapse after
losing Premier League contract
That plan, delivered at the 11th hour a week ago, had
saved Setanta from calling in the administrators at the start of
this week and brought initial renewed confidence that fresh
investment would arrive on the back of Blavatnik's
funding.
But the Premier League's desire to start working on their
television schedule for next season following the publication of
the fixture list meant they would not extend their deadline despite
Setanta's hope that the Access Industries' accountants could have
completed their due diligence given a few extra days.
Elsewhere in the TV industry, it was suggested that Blavatnik's
people had allegedly discovered huge tax debts owed by Setanta. It
was claimed as much as £50m was owed to the Inland Revenue and
further millions in Luxembourg.
Ironically FA chief executive Ian Watmore had already
renegotiated their deal with Setanta but it was always dependent on
the Premier League's approach.
Co-partners ITV Sport will pick up the available England games
at a highly discounted £2m-a-match. But Watmore's hardest task will
be reselling the FA Cup for anywhere near Setanta rates.
It is not just the top of the English game that will be
devastated by Setanta's imminent demise. A £3m-a-year loss of
revenue will be just as critical to the Blue Square Premier, while
the Scottish Premier League have already had to bail out clubs
after Setanta reneged on the latest instalment of their £45m deal.
If the Setanta money is not replaced, Kilmarnock and Motherwell are
likely to go into administration.
There will be few takers, if any, for Setanta's golf and boxing
coverage, while English rugby's Guinness Premiership will now
regret ditching Sky for Setanta the season after next.
Setanta released a statement last night saying the sports
channels would stay on air over the weekend at least.