Near-insolvent Sports Channel Setanta Finds 'very Credible' Investor
An executive from the beleaguered sports broadcaster said that the new bid needed "the help of certain rights holders" to succeed
Setanta executives were last night expressing genuine hope that the organization had been pulled back from the brink of collapse after a "very credible" investor emerged with an 11th-hour rescue plan.
Such was the sensitivity of the potential deal that there was no mention of the name of the bidder or its line of business. But the size and boldness of the approach took even Setanta by surprise. A senior executive contacted the Guardian last night to explain that the bid had come from "the left wing".
The executive indicated that the identity of the bidder has not been revealed in previous press reports, which means that ESPN, Sky, Al-Jazeera and the Irish billionaire Dermot Desmond can be ruled out. It is understood that the new rescue plan envisages keeping the Setanta business intact, with its operations in the UK, Ireland and the US being maintained as a single corporate entity.
But rights holders such as the Football Association, the Premier League, Premier Rugby and golf's USPGA Tour will not feel completely reasssured of their contracts with Setanta, as there was a word of warning. "It [the plan] needs the help of certain rights holders, including the Premier League," said the senior executive. "But everyone has been incredibly supportive and if everything slots into place over the next few days then we'll be OK."
The Premier League is due a payment of about £30m on Monday and it is Setanta's lack of access to cash to meet that commitment that has caused the recent crisis. There is no certainty the Premier League will offer the "help" required, since it believes it has watertight shareholder guarantees with the investment bank Goldman Sachs and the private-equity firms Doughty Hanson and Balderton Capital.
Setanta failed in its attempts to reschedule and renegotiate the size of that payment, as it did in similar talks with the Football Association, which is also confident of the £150m arrangement it has with Setanta's investors. Indeed, previous talks faltered because sports bodies felt that to provide succor would merely delay Setanta's inevitable demise and cause mutual financial pain.
The senior executive pointed out that with insolvency so close – the broadcaster is closed to new subscribers and had prepared the ground for Deloitte to step in as administrator – the organization would not be speaking with such confidence unless it considered the bid to be serious.
Such was the sensitivity of the potential deal that there was no mention of the name of the bidder or its line of business. But the size and boldness of the approach took even Setanta by surprise. A senior executive contacted the Guardian last night to explain that the bid had come from "the left wing".
The executive indicated that the identity of the bidder has not been revealed in previous press reports, which means that ESPN, Sky, Al-Jazeera and the Irish billionaire Dermot Desmond can be ruled out. It is understood that the new rescue plan envisages keeping the Setanta business intact, with its operations in the UK, Ireland and the US being maintained as a single corporate entity.
But rights holders such as the Football Association, the Premier League, Premier Rugby and golf's USPGA Tour will not feel completely reasssured of their contracts with Setanta, as there was a word of warning. "It [the plan] needs the help of certain rights holders, including the Premier League," said the senior executive. "But everyone has been incredibly supportive and if everything slots into place over the next few days then we'll be OK."
The Premier League is due a payment of about £30m on Monday and it is Setanta's lack of access to cash to meet that commitment that has caused the recent crisis. There is no certainty the Premier League will offer the "help" required, since it believes it has watertight shareholder guarantees with the investment bank Goldman Sachs and the private-equity firms Doughty Hanson and Balderton Capital.
Setanta failed in its attempts to reschedule and renegotiate the size of that payment, as it did in similar talks with the Football Association, which is also confident of the £150m arrangement it has with Setanta's investors. Indeed, previous talks faltered because sports bodies felt that to provide succor would merely delay Setanta's inevitable demise and cause mutual financial pain.
The senior executive pointed out that with insolvency so close – the broadcaster is closed to new subscribers and had prepared the ground for Deloitte to step in as administrator – the organization would not be speaking with such confidence unless it considered the bid to be serious.
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