DUBLIN-BASED pay TV broadcaster Setanta Sports is believed to have missed a £10 million instalment payment to the Football Association in England, potentially jeopardising its rights to live FA Cup and England internationals and raising concerns about its future viability.
It is understood that Setanta, which is carrying large debts, is seeking to renegotiate its four-year £150 million (€167 million) contract with the FA as a result of the economic downturn and its recent loss of lucrative Premier League rights, which is forcing management to restructure the business.
Setanta is also thought to be seeking to renegotiate other sports rights that it holds.
The FA rights are jointly held with terrestrial broadcaster ITV and the contract began at the start of the current season. ITV is also seeking to renegotiate its deal with the FA.
Setanta is also set to part company with Richard Brooke, its corporate development director. Mr Brooke, a former executive with BSkyB, was hired in 2005 to beef up Setanta’s management team in advance of it bidding for the lucrative Premier League rights.
Setanta recently lost one of its two Premier League live rights packages to rival Sky for the three years to 2013. It retained the right to show 23 games on Saturday evenings for three years from August 2010.
This package will cost it £159 million, 20 per cent below what it paid last time out, and Setanta has hired London-based merchant bank Chase Brothers to help it raise this money.
It is understood that Setanta paid a deposit to the Premier League recently relating to the new rights deal.
Mr Brooke’s departure is regarded as a first step in a major restructuring in the wake of the loss of the valuable league rights.
This is expected to involve job cuts as the company, founded by Irishmen Leonard Ryan and Michael O’Rourke, downsizes to reflect its reduced portfolio of English football rights, the main driver behind its 1.5 million subscriber base.
Mr Brooke, a former finance director with BSkyB, previously advised the business in his capacity as managing director of specialist firm St James’s Investment Partnership. His role included public affairs lobbying.
Setanta, which is backed by Doughty Hanson, Goldman Sachs and Balderton Capital, declined to comment on the missed payment or Mr Brooke’s departure.
Recently filed accounts for Setanta show that it made a loss of £114.9 million in 2007. It is thought to have racked a similar deficit last year.
Setanta’s net debt stood at £164.6 million at the end of December 2007. Its revenues that year rose to £118.7 million from £42 million in 2006 as a result of its Premier League rights increasing its subscriber numbers.
