Executives at Setanta will continue crisis talks today as the beleaguered broadcaster fights to save itself from administration.
The Irish pay-television company has suspended all new customer subscriptions as it tries to organise a £100 million rescue package. Investors have so far refused to put up more than £50 million.
It is believed that Michael O’Rourke and Leonard Ryan, the founders, are now considering selling Setanta’s US and Irish operations, possibly to Denis Desmond, the Irish music promoter who has a 20 per cent stake in Setanta Ireland.
The sale of the company’s international assets could plug the funding gap in time for Setanta to pay a critical instalment of around £30 million to the English Premier League on Monday. However, sources close to the talks suggest that no offers to rescue Setanta have yet been received by the broadcaster.
Many of Setanta’s international channels, which focus on showing British sport to the expat community, are profitable. One industry source reportedly claimed that the US and Irish businesses could “be worth a few hundred million”.
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Setanta declined to comment on the possibility of selling off its international assets and Mr Desmond could not be reached.
The broadcaster’s collapse would leave British sport needing to plug a £500 million-plus black hole, with football and rugby union clubs at risk of having their incomes cut.
Setanta has television contracts with the Barclays Premier League, the FA and the Scottish Premier League (SPL), but also to screen Guinness Premiership rugby union (from 2010), the Professional Golfers’ Association (PGA) tour in the US and Indian Premier League cricket.
Although the Premier League is owed most of the money — £130 million for next season and £158 million for the three seasons combined thereafter — it is probably in the strongest position because it is confident it will find a rival broadcaster willing to take on other games. In contrast, Setanta’s collapse could leave Scottish football in crisis, as it is the sole broadcaster of live matches north of the border.
Following days of crisis talks during which the business was widely expected to fail, the latest rescue effort is being led by Deloitte, the company’s advisors and accountants, who are poised to act as administrators if the company goes bust.
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Sources close to the talks said that a rescue package could come from one of Setanta’s international partners. The company has a joint venture in Canada with Rogers Communication — an “obvious partner”, the source said — while in the US Setanta works with Comcast and Fox among others.
It is also understood that Mr O’Rourke and Mr Ryan are considering a management buyout, partly funded with cash raised from the sale of the US and Irish assets. Under the plan, the founders would buy out the existing backers, including Doughty Hanson and Balderton Capital.
Hundreds of Setanta staff have been briefed by the company in separate talks around the UK. The message was that the company was not in administration but that there was a serious need for fresh investment.