Setanta aims to expand into Africa

Setanta Sports is lining up an investment in an African broadcaster that will see the Irish company extend its footprint into the continent.

A source close to Setanta said that discussions with Leading Independent Media (LIM) are at an early stage, but it is understood that Setanta is currently renegotiating its contract with the English Football Association to enable it to broadcast at least some Premier League matches to 41 sub-Saharan countries. A number of Premier League matches are already scheduled to be broadcast by LIM and Setanta to the region.

LIM, which is owned by its chief executive, Barry Lambert, and a number of Africa-based and European investors, was established five years ago. It sends live feeds to terrestrial television stations in sub-Sahara Africa, with commentary, which are then rebroadcast live in countries such as Ghana, Ivory Coast and Uganda. The company is registered in Africa, and is understood to be profitable.

Last year LIM signed a contract with FIFA's Infront Sports & Media to broadcast the World Cup to the region, in what was described as a landmark deal by the agency. It is believed to have cost LIM roughly £5 million (€7.4 million). LIM charges television stations a small technical fee and then recoups its investment through sponsorship deals with corporates such as Coca-Cola, Nokia, SAB Miller and PepsiCo. It is believed that Setanta and LIM are likely to continue with this model.

A source familiar with LIM said that the business has capitalised on the fact that most sub-Saharan countries are unable to afford broadcast rights for major tournaments. A tie-up with Setanta should enable LIM to achieve better buying terms for future events.

One source said a move into Africa would represent a "good opportunity" for Setanta to target "emerging markets", but added that a deal has yet to be finalised.

Setanta, which is 40 per cent owned by Benchmark Capital, paid the English Football Association €572 million last year to acquire rights to broadcast 46 Premiership matches a year for the next three years in the UK. It also won rights to broadcast 76 Premiership matches in Ireland and previously paid €80 million for rights to broadcast Scottish Premier League games.

Last year Setanta Sports raised €320 million in debt and equity from investors such as TV3, owned by Doughty Hanson, and Goldman Sachs, to help pay for the Premier League broadcast package. TV3 paid €100 million for its stake.