Financial Difficulties and UK Administration
According to the official Registre de Commerce et des Sociétés of the Grand Duchy of Luxembourg, the most recent annual accounts lodged by Setanta Sports S.a.r.l. indicated losses of €173 million (UK£149 million).
Reports on 7 June 2009 suggested that Setanta could be forced into administration that week after failing to make payments due on TV rights. Because of late payment and renegotiation over fees by Setanta to football clubs, several UK football clubs were put into financial difficulties as money promised had been spent in annual budgets. On 4 June, the Scottish Premier League announced they would be paying the sums that some of the clubs were owed to avoid causing them financial problems.
On 19 June, Setanta Sports failed to pay the latest installment of £30 million (€35 million) it owed the English Premier League. The Premier League had to sell the rights to the 46 live matches Setanta had for the 2009/10 season. A Premier League spokesman said, "It is with considerable regret that we announce that Setanta has been unable to meet their obligations. As such the existing licence agreement between us has been terminated with immediate effect."
Following this, the Daily Mail reported that a rescue deal had failed and "administration now looks inevitable". Two days later, it was reported on RTE News that the original Setanta Sports channel Setanta Ireland might be bought out by an existing consortium who already hold interests in Setanta Sport Holdings Ltd the Irish arm of Setanta Sports. Setanta Sports Ireland and Setanta Sports North America were the only brands which made a profit in 2008. The same day, Setanta lost all their SPL TV rights because they were unable to pay the £3m (€3.5m) owed to the league. Following this, it was announced that ESPN had bought the rights to show the 46 Premier League games bought by Setanta next season. The UK company went into administration following failure to make payments to a number of sporting organisations. About 200 employees were made redundant. The administration is to be handled by Deloitte.
According to the final report published by Setanta's administrator Deloitte, released in July 2010, the broadcaster had outstanding bank loans of UK£261m and unsecured debt of UK£288m. Deloitte said that unsecured lenders received just 2p for every pound that they have claimed back from the defunct operator.
Read more about this topic: Setanta Sports
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