Home » Commentary » Editorial

Setanta's Circumstances Worsen

by admincms — Tue, 2009-06-02 14:26 — Last Updated: Fri, 2009-12-11 01:31

(Update 4-June:  Legal action looms closer: See the Daily Record and Evening Times and Scottish Sun and The Independent.  The default date appears to be Monday after which legal action could commence.  Even if that is avoided, another much larger payment will be due in mid-month.  Update 12-June and 15-June:  see comments.)

The British newspaper the Guardian reported today that Setanta failed to make a scheduled progress payment to the Scottish Premier League (SPL). (See our earlier reports on Setanta's financial problems here.)  It's not clear what impact this will have to on-going operations including those in the USA and Canada or for AFL coverage.  At this time, programming seems to be continuing on all of their networks and AFL coverage does not appear to be affected.  However, since this failure to make the payment could place them in default to the SPL, it is not out of the question that they could be forced into receivership (bankruptcy) at any time. (Ed. note: as early as Monday 8 June.)  The SPL is a much smaller financial obligation than the English Premier League and much larger than the AFL. 

AFANA is monitoring the situation daily.   We have not had any communication from Setanta recently so we do not have any particular insight into what is going on at the US offices.   If we do not receive schedule updates as expected this week that would be a sure sign of further difficulty and raise our concern level.  (Ed. note: received as expected this week.)

There isn't much fans can do at this point (other than subscribe to Setanta) to change the situation.  Since coverage of the AFL on MHz Networks and America One also depends on the live feeds Setanta provides, the loss of AFL coverage on Setanta might end all AFL coverage in North America.  Further, all of the AFL coverage in North America, Ireland, and the UK is under one contract.  As a result, the possible implications of receivership in the UK are even more difficult to determine for fans in the USA and Canada.  AFANA will be in touch with the AFL on the possible impact to fans and continue to report on further developments.  

admincms's picture

Setanta Looking for Investor; ESPN Interest Unclear

Submitted by admincms on Fri, 2009-06-12 11:23.

According to reports on Sportbusiness.com here and here, Setanta is no longer accepting new subscribers.  AFANA has not been able to independently confirm that and would appreciate reports from fans.  Contact us here.  ESPN was quoted as stating they have "no plans" to buy Setanta however they did not say they wouldn't either.  We believe, from our sources, that ESPN has been contacted about purchasing some or all of Setanta or making an investment.  Given the value of the TV rights they still hold in Europe and North America, and the likely purchase price for Setanta, it is probably a case where a buyer could purchase a controlling interest in Setanta for less than the value of the rights.

-Rob
AFANA Chairman Emeritus and Site Admin

admincms's picture

Potential buyers emerge for Setanta

Submitted by admincms on Mon, 2009-06-15 17:44.

Late on Friday 12 June 2009, Endemol, a production company based in the Netherlands emerged as a potential "white knight" for Setanta in a joint deal with Access Industries.  However, that now appears to be less likely.  Setanta did dodge another potential landmine as it made a partial payment to the English Premier League and postponed some of the balance until the 19th with yet more due at the end of the month.   Negotiations appear to be continuing with the Access Industries, perhaps as a new majority owner and others, including Endemol, with a minority stake.  The price of the Access offer for a controlling stake suggests the apparent value of Setanta has been pegged at something close to US$64 million.  It's unclear if assumption of debt is in addition to this but some arrangement would seem to be needed for debt service.   Earlier reports set Setanta's debt at US$175 million however the Financial Times suggests it could be as high as US$1 billion.  The new figure probably includes obligations for future rights so may not represent a current shortfall.

The significance of Access Industries is that is the backer of Perform, Ltd.  Perform in turn operates Aussie Sport TV which delivers AFL video for Telstra and afl.com.au.  If they were to control Setanta that would give them a lock on AFL video delivery around much of the world.  It's impact on future AFL coverage is difficult to determine and could be both good or bad.   (Disclosure:  AFANA has promotional arrangement with Perform and Aussie Sport TV and is compensated for customers we send to them.)

There are several articles at these links:

Financial Times here and here and here.

Sportsbusiness.com

-Rob
AFANA Chairman Emeritus and Site Admin

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Syndicate content