THE ASSOCIATED PRESS
LONDON — Irish broadcaster Setanta Sports filed for bankruptcy protection on Tuesday, saying it will shortly cease broadcasting to customers in Britain after failing to make a number of payments to football organizations.
Setanta, which is backed by private equity firms Doughty Hanson and Balderton Capital, said it has suspended the collection of subscription payments in the U.K. after appointing accounting firm Deloitte to run the collapsed company.
The company’s international and Irish businesses are not part of the bankruptcy filing and remain on air while Deloitte holds discussions with potential buyers to take on those businesses as going concerns.
"This is a sad day for all concerned," said Setanta chairman Robin Miller. "Unfortunately, in a difficult and highly competitive market, and despite strenuous efforts by the board and management, it has not been possible to find sufficient additional funds in the time available to ensure its survival."
Setanta was pushed to the brink last week, losing its right to broadcast live English Premier League matches when it failed to meet a Friday deadline on a 10 million pound ($16.3 million) installment payment to the Premier League.
That was swiftly followed by the loss of its rights to broadcast the Scottish Premier League when it also missed a payment to that organization.
U.S. broadcaster ESPN — 80 per cent owned by The Walt Disney Co. — stepped in on Monday, snapping up the rights for the 46 English Premier League matches next season, without disclosing the terms of the deal.
Setanta said that existing investors were prepared to commit substantial additional funds to the business, subject to improvements in its operating performance, and that it had sought to make significant cost cuts by renegotiating its agreements with commercial partners and rights holders.
However, it said the improvements it achieved were insufficient to ensure that the business could become profit-making.
Around 200 staff in Setanta’s British operations will lose their jobs, the company said. It employed a total of 420 employees in the U.K. and Ireland.
Setanta’s collapse has given ESPN a foothold in Britain, where it currently draws only small ratings via just two channels, ESPN Classic and the flagship ESPN America channel.
Alongside the rights for the 46 games this season, which starts Aug. 15, ESPN picked up the rights for 23 matches in each of the following three seasons.
It reportedly paid less than the 130 million pounds ($212 million) agreed by Setanta for next season’s rights, followed by 159 million pounds in the subsequent years of the contract.
Setanta Canada is not affected by the UK problems because it has its own arrangement with EPL.
Setanta Canada is not affected by the UK problems because it has its own arrangement with EPL.