Irish TV network is on the brink of collapse
Since they lost half of their Premier League live rights for the 2010-2011 season, Setanta Sports have been teetering closer and closer towards administration.
The Ireland-based TV network have been unable to pay a £3m bill to the Scottish Premier League, which doesn’t put them in a particularly good position to pay the impending £40m bill coming from the English Premier League. They must now rely on hefty investment from third parties or a takeover bid to stop them collapsing.
If Setanta were to become insolvent, a fire sale of all their TV rights would probably occur, meaning their grossly overvalued contracts (including the £425m one for England and FA Cup games) could fall into the hands of rivals for knock-down prices.
A surprise lifeline may actually come from big-dog rivals Sky, who have been asked to provide a £50m interest free loan in exchange for Setanta becoming part of the Sky Sports package.It may sound like a bizarre request, but it is actually in Sky’s interest to keep their weak competitor afloat, rather than letting a huge shark like ESPN into the tank. It is The Spoiler’s understanding that BSkyB will do just about anything to keep the monolith Disney-backed network out of the picture, and since Monopoly rules prevent Murdoch’s lot simply taking all of Setanta’s packages, bailing out their ailing competitor would actually make sound business sense.
While the collapse of Setanta would have negative consequences for employees and viewers (you can kiss goodbye to news bulletins from Charlotte Jackson), it may also have a devastating knock-on effect for Premier League clubs.
This week, The Guardian reported that top flight sides cumulatively owe £3.1bn in bank overdrafts, loans and other borrowings. Without the steady income of TV money they were expecting, who knows how many clubs could find themselves in trouble…